The global healthcare third-party logistics market is expected to grow significantly. In the phase of persistent technological evolution, 3PL companies are inventing new and more proficient strategies to engage with consumers, contributing to market growth. Moreover, the focus of pharmaceutical and medical devices players to strengthen their distribution network to keep up with the competition and their sales numbers are some of the key factors driving the market.
Building a reliable healthcare supply chain system for the crisis is of utmost importance given the rise in COVID-19 cases and the average infection rate internationally. Third-party logistics (3PL) providers have emerged to connect market demand with trustworthy producers around the world. Some third-party logistics can help relatively small merchants with procurement along with basic transportation and storage services.
In the forecast period, the cold supply chain sub-segment is expected to have the fastest growth. This is mostly due to the increase in demand for biologics, a novel class of pharmaceuticals that has shown rapid growth in recent years. According to a Health and Human Services Department report, spending on biologics jumped from about 56% of total drug spending in 2006 to 77% in 2017. The government's decision to withdraw its transportation-related restrictions and standards for shelter-in-place makes the future of third-party logistics market for healthcare look promising. During the pandemic, a dramatic increase in demand for cold chain logistics was seen, especially for vaccine production and distribution driving the growth of healthcare third-party logistics market.
North America dominated the healthcare 3PL market. The region's dominance in the pharmaceutical and biologics markets as well as a growth in biopharmaceutical exports and imports are mostly to responsible for this growth. In addition, because of the high cost of healthcare, the region has a high adoption rate for cutting-edge technology. As a result, pharmaceutical businesses with operations in North America are depending increasingly on 3PL services providers, which is fueling the regional growth. The highest market share belongs to these companies with a wider existence in 3PL.
The industry is noticeable by the presence of several small and large industry players. The market is highly competitive in the North America and European region. Some of the key market players are Cardinal Health, DHL International GmbH, Agility, SF Express, Kinesis Medical B.V., United Parcel Service of America, Inc., Barrett Distribution., AmerisourceBergen Corporation, DB Schenker, FedEx., KUEHNE + NAGEL, Kerry Logistics Network Ltd., Freight Logistics Solutions.
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