Europe Pharmaceutical Logistics Market: Forecast Analysis 2024-2032

Europe Pharmaceutical Logistics Market: Forecast Analysis 2024-2032

Based on Triton Market Research’s report, the Europe pharmaceutical logistics market is estimated to advance at a CAGR of 7.16% during the forecasting years 2024-2032.

The demand for pharmaceutical logistics in Europe has surged, primarily due to increased needs for vaccines and drugs, further driven by COVID-19 and significant investments from leading pharmaceutical companies. Market players are striving to reduce distribution costs by developing single-source distribution channels, which further fuels market expansion. Additionally, the rise in healthcare spending has increased demand for pharmaceutical logistics. Latest estimates suggest that healthcare spending in the European Union accounted for approximately 8.4% of GDP in 2023, with countries like Germany and France being among the highest spenders.

Germany spearheads the regional market, attaining $7975.74 million in 2023

Germany boasts the largest healthcare sector in Europe, leading in market volume, patient numbers, medical technology manufacturing, and healthcare provision. In 2019, the country’s pharmaceutical industry sales rose by 5.7%, reaching approximately $41.4 billion.

The pharmaceutical logistics market is largely supported by over 500 pharmaceutical companies, with small and mid-size enterprises (SMEs) comprising around 90% of drug manufacturers.

The pharmaceutical industry has seen a notable shift towards biological drugs, with large companies increasingly focusing on complex biologics rather than traditional small-molecule drugs. This has substantially increased the demand for pharmaceutical logistics services.

Market Forecast for France and the United Kingdom

French pharmaceutical companies are notably export-oriented, with international sales of brand-name drugs significantly boosting their profit margins. In 2019, the nation ranked fifth in the global pharmaceutical industry, with most of its pharmaceutical exports going to other European countries. Besides, the government has embarked on initiatives like the ‘Innovation Health 2030’ plan, which includes approximately EUR 7.5 billion investment to strengthen research to launch new biomedical products.

However, the issue of counterfeit drugs has become increasingly prominent, with around a 62% rise in seized counterfeit goods in 2021. To combat this, the nation has established stringent regulatory guidelines, which are expected to boost the operations of pharmaceutical logistics companies.

The UK serves as a major hub for pharmaceutical production. Home to industry giants GlaxoSmithKline (GSK) and AstraZeneca, two of the world’s top 15 pharmaceutical companies, the UK plays a significant role in this field. There is a rising demand for treatments targeting age-related illnesses, which require sophisticated temperature-controlled logistics. The need for such specialized storage and transportation solutions has led to notable growth in the pharmaceutical logistics industry.

The market is broadly sectioned into pharma type, logistics type, component, and therapy area. Based on pharma type, it includes branded, generic, and OTC drugs.

Branded drugs, distinguished by specific trademarks and patent protections, generate substantial revenue for manufacturers but offer lower profit margins for wholesalers and pharmacies. In countries like the US and the UK, branded drugs are preferred over generics due to favorable reimbursement policies. Although these drugs are more expensive, their perceived quality and effectiveness often justify the cost. However, the introduction of generic alternatives can quickly reduce the sales of branded drugs.

The major firms in the pharmaceutical logistics market comprise DB Schenker, DSV, Deutsche Post AG, FedEx Corporation, and Kuehne + Nagel.

DB Schenker, based in Germany, offers a broad range of logistics and mobility solutions, including air and ocean freight, land transport, and contract logistics. The company operates in around 2,100 locations worldwide, with 430 dedicated to land, air, and ocean freight. It provides cost-effective and time-efficient services for partial, full, and general loads. In contract logistics, DB Schenker employs about 24,500 people across 750 locations globally, delivering tailored solutions for both the trade and industrial sectors. Within the healthcare logistics sector, it serves various segments, including biopharma, pharmaceuticals, animal health, and consumer health and nutrition, offering specialized and comprehensive logistics solutions.

Latest from the Company:

In April 2024, the company announced securing Good Distribution Practice (GDP) certification in more than 150 stations. This further supports it to cover 80% of the world’s healthcare flows.