Europe Pharmaceutical Cold Chain Logistics Market Size, Share, Competitive Landscape and Trend Analysis Report by Product, Temperature Type and Mode of Transportation : Country Opportunity Analysis and Industry Forecast, 2023 - 2032

The Europe pharmaceutical cold chain logistics market size was esteemed at $6,700.00 million in 2022 and is estimated to reach $12,307.51 million by 2032, exhibiting a CAGR of 6.5% from 2023 to 2032.

Pharmaceutical cold chain logistics refers to the specialized process of storing, transporting, and distributing temperature-sensitive pharmaceutical products, such as vaccines, biologics, and certain medications, within a controlled temperature environment. These products often need specific temperature ranges to maintain their efficacy and stability. Furthermore, the cold chain's temperature range typically varies between 2°C and 8°C for refrigerated products and 20°C and 80°C for frozen products. The specific temperature and time at temperature tolerances depend on the product being shipped. Common cold chain equipment includes refrigerators, cold boxes, vaccine carriers, ice packs, and foam pads.

Report Key Highlighters

• The Europe pharmaceutical cold chain logistics market study covers 8 countries. The research includes regional and segment analysis of each country in terms of value ($million) for the projected period 2023-2032.
• The study integrated high-quality data, professional opinions and analysis, and critical independent perspectives. The research approach is intended to provide a balanced view of global markets and to assist stakeholders in making educated decisions in order to achieve their most ambitious growth objectives.
• Over 3,700 product literature, annual reports, industry statements, and other comparable materials from major industry participants were reviewed to gain a better understanding of the market.
• The EU pharmaceutical cold chain logistics market share is slightly fragmented, into several players including A.P. Moller – Maersk, DB Schenker, DHL Group, DSV, Geodis, H. Essers, Kuehne + Nagel, Movianto, Sovereign, and VTS Transport & Logistics. These companies have adopted strategies such as product launches, product development, and others to improve their market positioning.

Moreover, cold chain logistics involves maintaining the integrity of the product by keeping it within the required temperature range from the point of manufacturing to the point of consumption. This usually involves refrigerated storage facilities, temperature-controlled vehicles, and monitoring systems to ensure that the products remain within the specified temperature range throughout the supply chain.

The rise in several refrigerated warehouses and expansion of the pharmaceutical sector, along with the government policies and initiatives to promote cold chain logistics are expected to drive the growth of the Europe pharmaceutical cold chain logistics market. In addition, the constant development of machines and medicines due to the rising number of approvals for pharmaceutical products in Europe has shown a positive trend in pharmaceutical cold chain logistics. Moreover, the rise in the number of products and services, from vaccines to cell and gene therapies, requires cold chain handling, and refrigerated warehouses. For instance, in December 2022, the European Commission issued the first approval of an allogeneic T-cell therapy in the world, a significant milestone for the cell and gene therapy sector. Such developments tend to increase the number of refrigerated warehouses for the storage of pharmaceutical products.

However, poor infrastructure and high logistics costs coupled with environmental concerns regarding greenhouse gas emissions are expected to restrain the market growth. On the contrary, the surge in the use of IT solutions & automated software for pharmaceutical cold chain logistics and the rise in demand for temperature-sensitive pharmaceutical drugs are projected to offer lucrative opportunities for the expansion of the market during the forecast period.

The Europe pharmaceutical cold chain logistics market is segmented into product, temperature type, mode of transportation, and region. By product, the market is divided into vaccines, biologics, specialty medications, and others. On the basis of temperature type, it is bifurcated into chilled, frozen, and room temperature. Depending on the mode of transportation, it is categorized into railways, airways, roadways, and waterways. Country-wise, the market is analyzed across France, Germany, Italy, Spain, the UK, Switzerland, Ireland, and the rest of Europe.

Germany is expected to dominate the Europe pharmaceutical cold chain logistics market in 2022 and is projected to grow at a significant CAGR during the forecast period. Germany, being a pharmaceutical hub, has a major presence and demand for refrigerated warehouses, distribution centers, and cold chain logistics networks, which, in turn, makes Germany a major contributor to the European pharmaceutical cold chain logistics market. For instance, in June 2021, DHL Supply Chain, the contract logistics leader within Deutsche Post DHL Group, started building an approximately 32,000-square-meter logistics center in Florstadt, Germany. The new facility is expected to offer customers from the pharmaceutical and medical products sector additional warehouse space in temperature zones of 15–25°C, 2–8°C, and −24°C. Such developments are expected to propel the growth of the pharmaceutical logistics market in the country during the forecast period.

Recent Developments in the Europe Pharmaceutical Cold Chain Logistics Industry

• In November 2023, A.P. Moller-Maersk started the construction work for its new large cold store in Rotterdam (The Netherlands). It has a warehousing facility for temperature-sensitive or frozen products such as pharmaceuticals, fruits, meat, or fish that is located right next to the Maasvlakte II terminal operated by APM Terminals. It has an estimated annual flow throughput of more than 43,000 FFE (40 Feet Equivalent Units).
• In May 2021, DB Schenker partnered with the SkyCell team to transform its logistics services to transport life-saving vaccines and medicines to remote areas around the world. Through this strategy, DB Schenker offers cold chain options for the pharma industry, which include −80°C to −60°C, −30°C to −15°C, +2°C to +8°C, and +15°C to + 25°C containers.

Rise in Number of Refrigerated Warehouses and Expansion of the Pharmaceutical Sector

The approval of significant pharmaceutical products in Europe shows a positive trend in the pharma industry, which implies the development of machines and medicines. The rise in the number of products and services, from vaccines to cell and gene therapies, requires cold chain handling, and refrigerated warehouses. For instance, in December 2022, the European Commission issued the first approval of an allogeneic T-cell therapy in the world, a significant milestone for the cell and gene therapy sector. Such developments tend to increase the number of refrigerated warehouses for the storage of pharmaceutical products. In addition, to protect products during transit, pharmaceutical companies and logistics service providers may utilize a range of passive solutions and temperature-controlled solutions.

Moreover, certain modes of transportation can be used to transport pharmaceutical goods. To prevent delays on the road and disruptions in the supply chain, it is vital to carefully plan a route and a logistical system as well as to establish the proper temperature condition. In March 2021, the Health Product Regulatory Authority (HPRA) Europe issued guidelines on good distribution practices for medicinal products for human use, extending temperature requirements to transportation, and expanding coverage to include over-the-counter drugs.

It mentions that the wholesaler must have documented evidence available for a review confirming that the product was maintained within the cold chain for the entire period during which it was outside of its control. To meet such needs, several warehouses and wholesalers utilize cold chain systems, which are designed to ensure the ideal storage and transportation conditions for temperature-sensitive products. These aforementioned factors are expected to fuel the growth prospect of Europe's pharmaceutical cold chain logistics market.

Poor Infrastructure and Higher Logistics Costs

Europe has a well-developed transportation infrastructure, including railways, highways, seaports, and airports. However, the cold chain logistics infrastructure in Europe varies considerably across different countries. Some countries have limited or inadequate infrastructure, whereas few countries lack adequate refrigerated storage facilities, specialized transportation options, and efficient monitoring systems. This may lead to temperature excursions, compromising the quality and efficacy of sensitive medications during the reverse journey.

Furthermore, cold chain logistics needs reliable infrastructure, a supply chain, and trade facilitation. Exception to these considerations, firms must develop more stock reserves and working capital, which can strongly affect national and regional competitiveness due to high financial costs. In addition, the lack of standards across borders in the cold chain industry, where the quality and adaptability of available cold warehouse space is a major problem, also presents significant challenges to market growth. These standards are required concerning storage temperature, security, and operational processes. Moreover, the lack of infrastructure hinders the industry by raising costs and lowering supply chain dependability. A few instances include significant transportation inefficiencies, deteriorating storage infrastructure, a complicated tax system, slow adoption of new technology, and inadequate logistical professional skills.

Moreover, the absence of specialized refrigerated storage & containers and poor facilities & management results in a high level of loss, damage, and deterioration of stock mainly in perishable goods. Infrastructure directly influences transport costs and indirectly affects the level of inventories, and consequently financial costs. In addition, increases in the price level are frequently supplemented by increases in demand, however, this is not the only factor driving up the cold chain logistics costs. The cost in the cold chain varies according to transportation. The cost in the cold chain varies according to transportation. As a result, several external factors affect the price of cold chain shipments, which is expected to hamper the European cold chain logistics market growth.

Rise in Demand for Temperature-Sensitive Pharmaceutical Drugs

The rise in demand for temperature-sensitive pharmaceutical drugs is a significant trend witnessed in the pharmaceutical cold chain logistics industry, due to constant innovation in biotherapies, such as cell and gene therapies, along with improved healthcare access in developing countries. Owing to this, the demand for more advanced storage solutions has grown exponentially to store and transport drugs safely and efficiently to patients across the region. Furthermore, the need for temperature monitoring in the pharmaceuticals and healthcare cold chain segment is significantly growing with temperature-sensitive products in the sector.

Moreover, the temperature requirement varies according to the specific pharmaceutical product. The life of drugs or vaccines degrade in temperature variations encountered in the supply chain, which is the key factor driving the need for cold chain monitoring solutions in the pharmaceutical sector. For instance, in September 2020, DHL Global Forwarding, an entity of DHL Group, introduced technology enhancements to its life sciences services division to meet the evolving pharma logistics needs. It has launched the New LifeTrack user interface a temperature-controlled shipment tracking portal, providing its customers with real-time analytics, digitalized standard operating procedures (SOP) information, and the lane risk assessment tool.

For instance, in March 2021, SkyCell launched a new 1500F container to meet the need for −20°C pharma product transportation. This container, developed on SkyCell’s platform approach, delivers robust performance and lightweight design (only 470kg), often leading to a reduction of CO2 emissions. Thus, the rise in demand for temperature-sensitive pharmaceutical drugs acts as an opportunity for the growth of the pharmaceutical cold chain logistics market.

  Europe Pharmaceutical Cold Chain Logistics Market Report Highlights

Aspects	Details
By Product	Vaccines Biologics Specialty Medications Others
By Temperature Type	Chilled Frozen Room Temperature
By Mode of Transportation	Railways Airways Roadways Waterways
By Europe	France Germany Italy Spain UK Switzerland Ireland Rest of Europe
Key Market Players	H. Essers, Movianto, VTS Transport & Logistics, Geodis, DHL Group, DB Schenker, Sovereign, Kuehne + Nagel, DSV, A.P. Moller–Maersk

Analyst Review

According to the insights of the leading CXOs, the pharmaceutical cold chain logistics market is expected to witness significant growth in Europe, due to an increase in online pharmacy orders in the healthcare sector. In addition, the rise in seaborne pharmaceutical transportation is a major factor that drives the cold chain logistics market growth across Europe. Moreover, the growing number of initiatives to promote cold chain logistics is anticipated to boost the growth of the logistics market for the healthcare sector.

In addition, when manufacturers and resellers do not have control over the cold chain, they may be forced to rely on third-party logistics providers who may not meet the same standards and may not have the same level of investment in maintaining the cold chain. Moreover, in several cases, the manufacturer or retailer is unable to monitor the operations at the warehouse, which is a serious threat to the quality of products, primarily perishable goods. Therefore, the lack of control of manufacturers and retailers on logistics services is anticipated to hinder the growth of the Europe cold chain logistics market.

The CXOs further added that market participants are focusing on business expansion efforts to expand their geographic presence and meet new business opportunities, intending to meet the changing demand scenarios. For instance, in May 2022, Yusen Logistics Benelux announced the opening of a new state-of-the-art pharma and healthcare warehouse in Gembloux (Wallonia) to further position Benelux as a strategic healthcare logistics hub for Europe. In addition, market participants are continuously focusing on acquisition efforts to match changing end-user requirements. For instance, in June 2022, DHL Supply Chain acquired 100% of Glen Cameron Group, an Australian logistics company specializing in road freight and contract logistics. Glen Cameron Group operates 1,000 trucks and trailers across Australia and employs over 820 people. Such initiatives are expected to contribute toward market growth.

Among the analyzed modes of transportation, roadways are expected to witness the highest growth rate, as it entails low capital investment as compared to other transportation such as rail and air logistics systems. This leads to the establishment of new companies and boosts its presence in the market. Moreover, the upsurge in need for effective temperature-controlled logistics solutions for temperature-sensitive goods is fueling the growth of the roadways segment. However, waterways are projected to grow at the highest CAGR during the forecast period, due to technological developments, such as machine-to-machine (M2M) communication, which have transformed the transportation industry with drastic changes in waterways transport, which is expected to propel the demand for waterways cold chain logistics transport.

The Europe pharmaceutical cold chain logistics market is segmented into product, temperature type, mode of transportation, and region. By product, the market is divided into vaccines, biologics, specialty medications, and others. On the basis of temperature type, it is bifurcated into chilled, frozen, and room temperature. Depending on the mode of transportation, it is categorized into railways, airways, roadways, and waterways. Country-wise, the market is analyzed across France, Germany, Italy, Spain, the UK, Switzerland, Ireland, and the rest of Europe.

Author Name(s) : Tanmay Sharma | Lalit Janardhan Katare

Related Tags

• Cold Chain Logistics
• Refrigerated Transport
• Medical Refrigeration
• Refrigerated Warehousing
• Cold Chain Transportation