The Indian pharmaceuticals and nutraceuticals sector has undergone a massive transformation. According to Assocham Knowledge report 2018, the Indian nutraceuticals market is expected to grow from $4 billion in 2017 to $18 billion in 2025, representing a growth of 21% CAGR. While the US, Europe and Japan currently account for over 90% of the total global nutraceutical market, India, China and other Southeast Asian countries are rising as new and emerging markets for nutraceuticals.
The trend has also led to the evolution of specialized cold chain networks that are vital for maintaining the integrity of pharma products by providing specific, temperature-controlled environments and decreasing the distribution cost, by creating a single source distribution channels. The global pharmaceutical logistics market size was valued at USD 76.4 billion in 2018 and is expected to register a CAGR of 3.5% from 2019 to 2025.
Some key trends that can help understand the rise of the cold supply chain for pharma in India, are as under:
1. India’s rising pharma exports: India is currently the world’s third-largest manufacturer, by volume, for pharmaceuticals. Government subsidies, Make in India and other pro-manufacturing policies as well as low cost of manufacturing, have all led to the rise of India as a preferred exporter of pharma and nutraceuticals. This, coupled with the rising demand in the US and European markets for nutraceuticals has resulted in increased bilateral trade and indo-western trade agreements, related to pharmaceuticals and nutraceuticals.
2. Evolving consumer choices: Evolving consumer trends have recently seen a shift from remedial to preventive healthcare. With the widespread increase in lifestyle disorders, early-onset cardiac and metabolic complications, and the lack of a healthy diet and exercise routine in a stressful urban lifestyle, a large number of people are turning to supplements in search of health. Factors like rising awareness about preventive health and significance of overall wellbeing, need to manage the daily stress and the prevention of resulting diseases, are all driving this shift towards preventive medicine, led by nutraceuticals while clam to fortify and nourish the body against day to day stressors.
3. Rise of e-pharmacies: The advent of e-pharmacies has transformed the way India consumes its generic and prescribed medicines. Similar to the disruption caused by e-commerce in the retail sector, e-pharmacies are offering consumers heavy discounts, the convenience of ordering medicines online and the benefits of a fast track delivery, anywhere and anytime. This is applicable for both, generic as well as prescribed medicines and nutraceuticals and allows individuals, patients, professionals, and caregivers to order the required medicines at the click of a mouse.
In line with the above trends, the evolution of a robust and effective cold supply and cold storage technology has become vital. Cold storage for pharma is an extremely sensitive and demanding business, with a varied range of medicines, raw materials, nutraceuticals, and vaccines etc., that require specific storage and careful handling.
India’s logistics and cold supply chain sector has also undergone a transformation. The sector is currently marred with several challenges, including poor infrastructure and transport facility, lack of trained resources, and the extremely crucial temperature parameters that need to be followed. It is not surprising then that most pharma companies end up spending up to 1/3rd of their revenues on effective and safe transportation.
The need for a well-structured and organised cold supply chain – from temperature-controlled vehicles and warehouses to trained handlers and drivers, has become extremely vital. While cold transport is being slowly developed, an increasing number of warehouses are adopting the latest AI and IoT technology to offer a seamless and effective solution to Pharma and Nutraceutical companies, enabling them to meet the rising needs of the sector.
This article has been authored by Aditya Vazirani, CEO, Robinsons Global Logistics Solutions.