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Pharmaceutical Logistics Services Providers Convert Trends Into Opportunities for 2019

“There are more changes in the pharmaceutical logistics industry than there are presents in Santa’s sleigh,” according to Adam Runsdorf, President of WDSrx, a global pharmaceutical logistics services provider connecting prescription drug products and over-the-counter medications between manufacturers, patients and consumers.

Like digging through presents under the tree, these trends are some of the biggest boxes we’re opening for 2019:

THE KARDASHIAN EFFECT

Drugs and personal care are merging – The FDA classifies certain personal care items as drugs depending on their intended use.  As cosmetics and skincare items deliver more health benefits, more of these items are entering the pharmaceutical supply chain.  And as online purchases for beauty take up an increasing percentage of total beauty sales in all channels (21% in 2017), direct-to-consumer fulfillment and returns are skills progressive pharmaceutical warehouses are acquiring quickly to compete in this growth category.

Beauty products may also be categorized as drugs requiring different regulations to remain compliant for order handling and e-commerce fulfillment.

OUTSOURCING IS IN

Healthcare mergers and acquisitions are powering the pharmaceutical 3PL industry.  According to PwC there were 255 healthcare mergers and acquisitions during the second quarter this year, marking the 15th consecutive quarter with at least 200 such transactions.  As venture money takes over operations, non-core functions are being outsourced to better manage essential operations.  The beneficiaries of this shedding of services including packaging and labeling, financial services, government reporting, reverse logistics, pharmaceutical warehousing and fulfillment are Logistics Services Providers (LSPs). These specialized companies gain efficiencies for clients that manufacturers commonly cannot achieve on their own.  The same trend also benefits contract manufacturers that are partnering with brand owners to manufacture their medications more cost-effectively.

The M&A market for healthcare manufacturers is heating up and non-core functions including warehousing and fulfillment are being increasingly outsourced to Logistics Services Providers so companies can focus on core research and marketing strategies.

With these major changes and others, the pharmaceutical logistics industry must adapt quickly and respond immediately to manufacturer requirements.  And that’s one thing this year that will stay constant in 2019.

Happy New Year!”

Are any Controlled Substances (CII) included in your return? If so, please press "Yes" and complete the DEA 222 Request Form. You can also contact Jason Solomon at jsolomon@wdsrx.com or (561) 998-3885 x316.