Investing in supply chain visibility can save billions in pharmaceutical logistics

As technology pours into the logistics industry and illuminates supply chain blind spots, opportunities for efficiency and profit abound. The pharmaceutical industry, for instance, loses at least $15 billion of product each year to temperature deviations that force cargo disposal. When taking additional costs into consideration, such as labor expenses for damage analysis and product replacement, the annual cost spikes to over $35 billion. When coupled with natural disasters like hurricanes, maintaining sanctity of shipped food, blood and pharmaceutical goods becomes extra precarious. However, the technology is available to interrogate cargo with a Bluetooth-connected cellphone to make sure each pallet is in range and safe. This technology also can help identify the causes of each temperature excursion. But let’s step back for more context. A recent report by ChainLink Research shows that 80 million to 130 million climate-sensitive shipments happen worldwide each year. In 2018, logistics spending for temperature-controlled pharmaceuticals was $15 billion, and it’s projected to outpace overall pharmaceutical spending at a rate of 8%, as opposed to the 2% rate for non-cold-chain products.