Clinical Logistics

Clinical Logistics Global Market Outlook:

• The global market is expected to grow with a CAGR of 7.3 percent between 2022 and 2027​

• 2022* market value is expected to reach up to $19.2 billion

• North America accounts for about 40–45 percent of the clinical trial supplies

• Major CROs and biopharmaceutical companies have their hub in this region because of higher number of clinical trials conducted in these regions

Clinical Logistics Market Overview

• The global clinical trial supplies market is expected to grow at a CAGR of 7.3 percent during 2022–2027. This will be driven by the growth in biologics pipeline, growth of clinical trial footprint in the emerging markets (Brazil, China, India, Russia, South Korea), and increase in adoption of comparator studies.

• The global clinical logistics market is expected to grow at a CAGR of 7.3 percent, and the market is estimated at $19.2 billion in 2022* and $27.8 billion in 2027

Clinical Logistics Drivers and Constraints

Drivers

• Stringent Regulatory Environment: FDA and other regulatory authorities have increased stringency of quality, storage, packaging and labeling, distribution, and recall of ancillary products. Companies now source ancillary products at different levels, like central sourcing and regional sourcing.

• Globalization of Clinical Trials: Due to globalization of clinical trials, pharma companies are conducting clinical trials, especially phase III clinical trials in distinct geographies, including the fast-growing Eastern Europe, China, Korea, and Taiwan. This has led to increase in planning and sourcing ancillary materials

• R&D Investments: Increase in R&D investments and government support increased the scope to conduct more research

Constraints

• High Waste and Overage: Clinical trials are experiencing a very high level, approximately 150–200 percent of clinical supply waste leads to unwanted cost escalation and high inventory. This impacts the use of internal resources within pharma and biotech companies

• Interactive Response Technology: Regulatory environment in many countries is very dynamic for some time and change comes very fast. This, along with a high initial cost for installing IRT, proves to be an obstacle in the path of integrating Clinical Ancillaries with Interactive Response Technology (IRT) and most of the work is done on manual basis using excel sheets

Porter's Analysis on Clinical Logistics

Supplier Power

• Fragmented supply market

• Spend consolidation activities are limited to a few large pharma companies

Barriers to New Entrants

• Top suppliers are increasing their market share

• Difficult to develop a network of drug suppliers across the globe

• Compliance to complex regulations

• Difficulty to develop the wide-range expertise that the buyers are requesting

Intensity of Rivalry

• Fragmented supply market

• High degree of variation in requirements/specifications

Threat of Substitutes

• High switching cost

Buyer Power

• Functional outsourcing strategy (mix of in-house and outsourced)

• Outsourcing is cost effective

• Buyer consortiums are emerging