The global biopharmaceutical third party logistics market size was valued at USD 110 billion in 2022 and is expected to hit over USD 192.39 billion by 2032 and growing at a CAGR of 5.80% from 2023 to 2032.
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The U.S. biopharmaceutical third party logistics market size reached USD 31.57 billion in 2022 and is predicted to expand around USD 55.22 billion by 2033, at a CAGR of 5.3% between 2023 to 2032.
North America was the highest revenue contributor with a market share of around 42% in 2022. This is mainly attributed to the dominance of North America in the biopharmaceutical industry. North America is characterized with the presence of huge biopharmaceutical giants. In fact, the majority of the patents for the newly developed medicines belongs to US. The rapidly growing biopharmaceutical industry in North America is the major driver of the market. Moreover, the burgeoning demand for the various biologics in the region is expected to further drive the growth of the market in the forthcoming years. The increased adoption of the advanced technologies and the rising healthcare expenditure is fueling the growth of the biopharmaceutical industry, which in turn is fostering the growth of the biopharmaceutical third party logistics market.
Asia Pacific is estimated to be the fastest-growing market during the forecast period. The rapidly growing geriatric population and surging adoption of the biologics among the population, owing to the growing prevalence of various chronic diseases is expected to spur the growth of the biopharmaceutical third party logistics market in this region. The expanding manufacturing units of biopharmaceuticals in the countries like China, India, and South Korea is offering immense growth opportunities to the market players in Asia Pacific region.
The biopharmaceutical industry alone constitutes around 20% of the global pharmaceutical market. The biopharmaceutical industry has developed various life-saving drugs to treat the chronic diseases like cancer, diabetes, respiratory diseases, and cardiovascular diseases. The rising awareness regarding the biopharmaceuticals has significantly surged its demand among the consumers. The rising trend of outsourcing the logistics, rapid growth of the biopharmaceutical industry, and growing focus of the manufacturers on the development of distribution network are some of the prominent factors that drives the growth of the global biopharmaceutical third party logistics market. The availability of technologically advanced systems that can manage temperature in logistics is expected to fuel the demand for the biopharmaceutical third party logistics as certain drugs needs special attention pertaining to the storage conditions. Moreover, the adoption of latest technologies amongst the logistics service providers such as cloud solutions, data mining, warehouse robots, and real-time monitoring has significantly altered the way of modern day operations in logistics industry. The adoption of advanced vehicles that can control the temperature systems while in transit, and the elimination of the possibility of damage and human errors are some of the crucial factors that fosters the growth of the biopharmaceutical third party logistics market.
| Report Coverage | Details |
| Market Size | US$ 192.39 Billion by 2032 |
| Growth Rate | CAGR of 5.80% from 2023 to 2032 |
| Largest Market | North America |
| Fastest Growing Market | Asia Pacific |
| Base Year | 2022 |
| Forecast Period | 2023 to 2032 |
| Segments Covered | Service Type, Supply Chain, Region |
| Companies Mentioned | Agility Logistics, AmerisourceBergen Corporation, DB Schenker, DHL International GmbH, FedEx Corporation, Kerry Logistics Network Limited, Kuehne + Nagel International AG, McKesson Corporation, SF Express Co. Ltd., United Parcel Service of America, Inc. |
The development of temperature monitoring technologies is another factor that boosts the market growth. Apps have been introduced to monitor the temperature of certain temperature-sensitive medicines that can be operated through a smartphone. For instance, Onset’s InTemp CX400 mobile application is a pharmaceutical cold chain monitoring app that allows the user to monitor the temperature and it sends notifications to the user regarding the excursions of temperature. The development and deployment of such technologies ensures the safety of the medicines and boosts the demand for the third party logistic services across the pharmaceutical industry. The adoption of the third party logistic services has significantly helped the biopharmaceutical companies to reduce their overhead expenses and hence the adoption of the third party logistic services has increased in the past few years. The lowering operational costs results in the lowering of the medicine prices which is welcomed by the customer across the globe. These cost benefits are expected to further fuel the growth of the biopharmaceutical third party logistics market.
The growing geriatric population, rising prevalence of chronic diseases, rising healthcare expenditure, and growing demand for the biopharmaceutical drugs are some of the major factors that drives the need for the safe and timely delivery of drugs at various locations, which is exponentially driving the demand for the third party logistic services. Apart from the biopharmaceuticals, the rapidly growing demand for the biosimilar medicines is gaining traction among the patients across the globe. The surging growth of the biosimilar medicines is expected to contribute significantly towards the market growth in the forthcoming future.
Based on the service type, the warehousing & storage segment accounted for a market share of over 43% and dominated the global biopharmaceutical third party logistics market. The surging demand for the warehousing and storage services among the life sciences and pharmaceutical companies has favored the growth of this segment. The warehousing & storage services helps the life science companies to reduce their overheads and contribute towards increasing their profitability. The service providers are also offering value added services like warehousing and packaging, which further attracts the pharmaceutical companies. Moreover, the availability of the robots, and code scanners reduces the turnaround time has boosted the growth of this segment.
The others segment is expected to grow at a significant rate throughout the forecast period. The other segment includes value-added services like custom, packaging, procurement services, duty management, and few other type of services. The third party logistic service providers are heavily investing in the value-added services to gain competitive edge and attract clients. Therefore, the surging investments in the value added services is expected to drive the growth of this segment.
Depending on the supply chain, the non-cold chain logistics dominated the global biopharmaceutical third party logistics market. This segment accounted for a market share of around 81% in 2020. This is attributed to the increased sales of the pharmaceuticals through the distributors. The logistic services offers scalability, reduction of operational cost, higher returns, and lower risks. All these advantages offered by the third party logistic providers has made it an integral part of the biopharmaceutical industry.
On the other hand, the cold chain is estimated to be the most opportunistic segment during the forecast period. The development and rapid growth of the biologics is a major factor that drives the growth of this segment. The biologics require time and temperature controlled distribution.
Key Market Developments
The biopharmaceutical third party logistics market is moderately fragmented with the presence of several top market players. These market players are investing heavily in the value-added services to gain competitive advantage and gain market share. Furthermore, these market players are engaging in various developmental strategies such as product launches, partnerships, joint ventures, and mergers to exploit the prevailing market opportunities.
Segments Covered in the Report
By Service Type
By Supply Chain
By Geography
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