The coronavirus pandemic has prompted a surge in demand for transport of critical medical supplies worldwide, putting the life science operations of logistics companies in the spotlight.
While the peak in such shipments is over, logistics players noted that investments to develop the sector will continue well beyond Covid-19, noting the vital role of the segment in the global fight against such health emergencies.
Sean Wall, executive vice president, network operations and aviation, at DHL Express Asia Pacific, said throughout the pandemic, DHL has seen an increase in cross-border express shipments of critical coronavirus medical supplies including masks, gloves, goggles as well as “hundreds of pallets of ventilators” and testing kits in temperature-controlled shipments.
“We have passed the peak in volumes now. We have seen double-digit growth in shipments for our life science sector,” Wall told Asia Cargo News, noting that DHL has also reallocated and sourced additional aircraft and capacity to support uplift of needed medical equipment, especially from Asia to Europe and US.
As part of its Strategy 2025, Wall noted that DHL will continue to invest in both infrastructure and digitalization which will benefit its customers in the life sciences sector, including building up capabilities in cold chain transportation as well as innovative technologies in its operations.
“We have introduced chilled contingency storage in our main Asia Pacific gateways to ensure that drug shipments are stored at the right temperature as it goes through customs clearance. We have also invested in environmentally-friendly reusable insulated packaging for the life science sector, with a robust program that enables the packaging to be returned and reused again,” Wall said.
On the infrastructure side, he noted that DHL has ordered 14 new Boeing 777F aircraft in 2018 to support growing freight volumes in general. Four were delivered in 2019, six will come this year and another four are to be taken into service next year.
Increasing focus in life sciences
“Even before Covid-19, the life sciences sector has been growing at a steady pace. The pandemic will certainly accelerate the sector’s growth, considering how important it is in the battle against Covid-19,” Wall said.
“There is a greater need for flexibility and speed when it comes to the transport of time-sensitive medicines, specimens or clinical supplies,” he noted, citing clinical trials for a coronavirus vaccine now being conducted on a global basis.
Valuates Reports said in May that the global pharmaceutical logistics market size is expected to reach US$144.74 billion by 2026, from the 2020 level seen at US$88.49 billion.
Kuehne + Nagel said separately that it has also observed a surge in pharma and time-critical shipments in its operations during the pandemic driving the expansion of its pharmaceutical and healthcare businesses.
“With the unfolding of the pandemic, there has been a surge in demand across the world for healthcare and medical products in recent months. This led to an increase in transport volumes for pharmaceuticals and medical equipment,” Kuehne + Nagel told Asia Cargo News in a statement.
The global logistics company, headquartered in Switzerland, said on the forefront of the demand were to move health and medical-related items such as personal protective equipment (PPE), Covid-19 test kits as well as medical equipment like ventilators for hospitals. Since the beginning of March, Kuehne+Nagel has transported several hundred million face protection masks for its customers via air freight, it added.
Kuehne + Nagel noted that its KN PharmaChain service was at the forefront of its life sciences operations providing “differentiated solutions for time-critical shipments, ambient or temperature-controlled door-to-door solutions.”
Jens Drewes, president of Kuehne + Nagel Asia Pacific, says: “Pharmaceutical and healthcare have been a strategic focus for Kuehne + Nagel for many years. We recognize the need to invest in people, technology and infrastructure to support the rapid growth of the industry.”
The company expanded its pharmaceutical customer solutions portfolio with the acquisition of Quick International Courier, a market-leading provider of time-critical transportation and logistics solutions in 2018 — adding on to its pharmaceutical scope of services and capabilities to fulfil time-critical shipments and clinical trials.
Role of logistics in recovery
Meanwhile, Kuehne + Nagel expects Life Sciences logistics to expand beyond the coronavirus and said companies that are “able to transform and offer the right balance of technologies, expertise and human touch,” in the sector will have a competitive advantage in the market.
“As the market for the pharma and healthcare segments in the Asia Pacific will continue to grow in the years to come, we put further focus on optimizing the supply chain management for companies in the Life Science sector,” says Drewes.
DHL for its part said the key themes of digitalization, e-commerce, globalization and sustainability will play out over the next five years.
“Globalization and open trade make it possible to manage such a pandemic in the first place. This includes the exchange of important goods such as medicines. Imagine if the pandemic had struck 10 or 20 years ago, without the digital and logistical infrastructure and innovations. We would be in a much more difficult situation,” Wall said.
“Trade will play an important role in the recovery once this is all over, and the logistics sector as the backbone of that would be crucial in ensuring the world keeps moving,” he added.
By Charlee C. Delavin
Asia Cargo News | Hong Kong