Marine Transportation Becomes Feasible For Pharmaceuticals

Low Costs, Failsafe Temperature Control, 24-7 Visibility Are Attractive

Ocean shipping has long been the transportation mode of choice for low cost goods with long shelf lives. Items that were high value, high tech or had limited shelf lives were shipped air cargo or, once on the continent, by truck or train. That is beginning to change. Now, even pharmaceutical manufacturers and logistics providers are exploring ocean shipping for all or part of a journey.

The use of ocean shipping for pharmaceuticals isn’t yet commonplace, and it isn’t without risks, but some of the world’s largest pharma companies are looking seriously at options and are testing some routes. Their willingness to consider an alternative to air cargo is based upon three things: declining profit margins triggered by the impending patent cliff, when many blockbuster drugs will go off patent; increased globalization that is opening remote, often developing, markets; and improvements in temperature control and monitoring capabilities.

Low Cost Transportation Needed

To put all that in perspective, by 2018, some $17 billion of branded pharmaceutical products will lose patent protection. Those revenues won’t be replaced by other blockbuster drugs, but with many drugs with smaller revenues and greater expenses.

Those drugs, increasingly, require controlled temperatures. The current market for pharmaceutical cold chain (2°- 8°C) logistics is valued at $7.5 billion in 2013 and is expected to reach $9.3 billion in 2017, according to the 2013 Biopharma Marine Transportation Becomes Feasible for Pharmaceuticals Cold Chain Sourcebook. Additionally, controlled room temperature (CRT) – defined as 15°C and 25°C – is becoming more important. Respondents to a Pharma IQ survey reported that 63 percent are investing in CRT shipping solutions, and 50 percent said at least half their products require CRT storage.