Sustainability gains momentum in pharma cold chain logistics

Major pharmaceutical manufacturers are rapidly pursuing carbon neutrality by 2030, with logistics playing a crucial role. These commitments have sparked extensive discussions among stakeholders, leading to emerging trends in the industry. From innovative packaging solutions to shifting modes of transportation, pharmaceutical logistics is undergoing a significant transformation.

Reusable temperature-controlled packaging 

The pharmaceutical industry is seeing an increased adoption of reusable temperature-controlled packaging for the transport and storage phases of the supply chain. With a growing appetite to leverage this specialty packaging, it’s estimated that utilization rates could more than double from 30 percent to 70 percent in the coming years. This packaging is helping many companies achieve their sustainability goals, and recent technological advances have made this solution more affordable and efficient. The reverse logistics cost is still present, but not enough to offset the overall cost effectiveness of reusable packaging.  

Reusable, temperature-controlled packaging manufacturers no longer work in silos, but now in tandem with drug manufacturers and other industry stakeholders, ensuring high levels of collaboration. Across the entire logistics chain, there is a positive trend of sharing responsibility and working together to achieve sustainability goals. 

As a global provider of pharma supply chain solutions, CEVA Logistics is also collaborating with leading pharmaceutical companies to provide a rental model for sustainable temperature-controlled packaging. This partnership aims to address the growing demand for efficient and sustainable solutions, particularly for temperature-sensitive products, such as vaccines, biologics and other high-value medicines.  

There are numerous advantages to using a temperature-controlled packaging rental model, the first and most obvious is cost efficiency. Pharmaceutical companies can reduce capital expenditure and the upfront costs of purchasing specialty packaging. Renting allows companies to pay only for the duration of use which is ideal for short-term logistics projects, seasonal demand or regional needs. For example, some parts of the world have extreme temperatures and varying infrastructure quality. Often, rental providers have region-specific expertise and address unique issues with tailored solutions to meet market needs. The ability to scale up or down without investing heavily in packaging enables companies to focus on their core business. 

Finally, risk is taken off the pharmaceutical companies when renting as the responsibility for the integrity and functionality of the packaging is on the rental providers. This can be particularly beneficial in a region where extreme temperatures pose a significant challenge to maintaining product freshness. Another aspect of risk management is in the event of unexpected supply chain events such as unforeseen demand—rental models offer the flexibility to quickly access additional packaging without long lead times and delays. Beyond reducing risk and capital investment, the temperature-controlled packaging rental model allows pharma companies to have greater control of their environmental impact. Unused containers are at risk of premature aging if improperly stored, creating more waste and taking up valuable storage space.

Modal shift – air to sea 

Reducing CO2 emissions in pharmaceutical logistics can also be achieved by shifting modes of transportation from air to sea. It is estimated that airfreight generates 47 times more greenhouse gases than ocean shipping for every ton-mile. Furthermore, airplanes produce 500 grams of CO2 per metric ton of freight per kilometer of travel while cargo ships only produce 10-40 grams per kilometer. While shipping by sea instead of air has a clear sustainability advantage, the unique complexities of pharmaceutical products must be taken into consideration.

An important aspect of this concept is inventory planning as shipping by sea often requires more on-hand inventory, thus impacting storage requirements. Many large international pharmaceutical manufacturers have already made this shift with an average of more than 50 percent of their products now shipping by sea. With the modal shift, cargo tracking and reliable arrival information remain important elements in the supply chain.

Unlike produce, most pharmaceutical products have a longer shelf life and can withstand longer journeys. While sea freight is certainly more cost-effective and sustainable, there are external factors that can have effects—like the unpredictable geo-political climate. Diversifying shipping models, leveraging a combination of sea and air freight, can help alleviate these risks. To balance cost, CO2 emissions and unexpected shipping issues, experts recommend that pharmaceutical companies ship most of their inventory via sea while holding sufficient stock on hand to dispatch via air should it be required.

The pharmaceutical industry is at a critical point in its journey towards sustainability, with logistics as a key facilitator in this transformation. These changes not only contribute to reducing the industry’s carbon footprint but also enhance efficiency and maintain focus on patient safety by ensuring the integrity of these valuable products. It is important that we continue to work together across the value chain to ensure innovative solutions are linking together to make an impact on this critical topic.