Cold Chain in Emerging Markets

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Saddam Huq

Cold Chain Biopharma Logistics Sourcebook growth rates for pharma, biotech, vaccines, blood products and clinical materials were surveyed in 2011. The report showed that 7 of the top 10 global pharma products in 2014 are temperature sensitive. According to industry estimates, vaccines will grow on average eight per cent per year through the next five years. The greatest growth for Pharmaceutical cold chain shipments will most likely come from emerging markets. Africa, Asia and Latin America signify key emerging markets for the pharmaceutical industry, but are also the main areas of challenge for time/temperature sensitive products.

Asia is emerging as a global powerhouse in the healthcare industries. As we see the economic boom within the emerging countries, vaccines and biologics have become more accessible for the local markets. We see this trend as major Biotech Companies have strategically entered in partnership agreements with local pharmaceutical companies or set up manufacturing plants supplying the local markets. Alternatively, we also see strong ambitions from local Manufacturer’s in India such as ‘Serum Institute of India’ that are supplying vaccines to WHO globally.

Even though the world is getting smaller, the supply chain model for handling time/temperature sensitive drugs are getting overly complicated. This has resonated with more Regulators now addressing their cold chain expectation for drugs entering their market and also setting standards for their local distribution requirements. Emerging markets like Saudi Arabia, Singapore, Malaysia and Brazil are among the countries that have made documentation of shipments of cold chain pharmaceuticals an entry requirement. Good Distribution Practice (GDP) guidelines are being issued by the local regulators from various countries as they reach a certain level of maturity in cold chain. There are more than thirty-five (35) GDP guidelines available globally and many more are coming on its way. ‘WHO’ Guidelines are taken as the benchmark for many countries who have not published their own standards. Eventually, all health authorities will demand the same requirement.

The growing trend is for pharmaceutical organisations to make their internal processes more rigorous, and demand more quality assurance measures from their cold chain logistics providers and packaging vendors. India, viewed as one of the key growth markets, recognized its weak link by improving its provision at major airports, including Mumbai and Hyderabad, but cold chain facilities still pose a barrier with the unstable power supply to the development of the market in the country.

As the end-to-end supply chain dynamics is particularly challenging in emerging market, one solution has been to invest in packaging that can protect products against high temperature variations and last for a longer duration.

The cold chain industry has grown rapidly in the last five years with the solution providers from the ‘West’ now having a strong presence in the emerging markets. Factoring in global trends in pharma manufacturing and distribution, the market for temperature-control ("cold chain") services (from road, air, sea and third-party logistics firms; and dedicated packaging and instrumentation) was projected to rise from $6.5 billion in 2010 to $7.6 billion in 2013, according to the 3rd annual Biopharma Cold Chain Sourcebook. This is driven by the strong demand from pharmaceutical companies that require specialized storage and transport of drugs and clinical trials samples.

Infrastructure and Technology is an important investment required to maintain the quality of cold chain. Companies generally seek a long-term perspective in relation to investment. Cold Chain technology and solutions are available widespread, however organisations usually tend to avoid the substantial investment due to the cost factor. In emerging markets and especially in Africa, companies seek simple and cost-effective solutions to problems. For many companies, the problem has not been with the cold chain itself, but a failure to turn to the technology soon enough.

With every challenge, there is an opportunity for success, and many vendors and LSPs have the potential to achieve great success. Having cold chain as a competitive advantage is not enough; advancements are also required with the combined aims of cutting environmental impact (re-usability), lighter packaging, meeting regulatory requirements, ensuring security, reducing the cost and further adding to the economic benefits which initially attract pharmaceutical companies to emerging markets.

The cold chain management is specific, specialised and technical. Every stakeholder has to do their part with due diligence. It is the cold chain awareness in the emerging markets which will play the pivotal role for a successful cold chain management program. Pharmaceutical in-house training, Cold Chain seminars and Conferences will ultimately drive this knowledge forward.

(The views and opinions expressed here are the author's own and not those of GlaxoSmithKline.)


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