Market Overview

The market size of domestic logistics services for medicines and medical equipment (based on the sales at logistics service providers) for FY2020 rose by 3.8% to 110 billion yen. With the shipment volume of medicines and medical equipment as well as the rate of outsourcing logistics tasks increasing, together with expansion in service providers, the market is showing stable growth, more than 1.6 times larger market size than in FY2011.

Noteworthy Topics

Wider selections of outsourcing service providers

In recent years, there have been many entries to the pharmaceutical and medical equipment & material logistics services market, including those major logistics and warehousing companies that are showing high profiles in investments in the development of large-scale logistics centers targeting this field. For pharmaceutical companies, because they now have wider selections of logistics companies to outsource, some have started reviewing the current outsourcing contracts. As the Japanese version of GDP (Good Distribution Practice) guideline for distribution of medicines was issued in December 2018 by MHLW, GDP-based quality control in distribution has become required. Whether or not the distribution processes and logistics management appropriately conforming to the guideline or not has become critical factors to select outsourcing service providers.

Future Outlook

With more than 60% of logistics processes at pharmaceutical companies and medical equipment & material manufacturers seemingly being outsourced, finding and obtaining new customers are becoming limited for logistic service providers. That said, however, logistics companies continue to find servicing for pharmaceutical field attractive due to the stability hardly affected by economic conditions.

Recently, there even has the debate being generated on the introduction of digital platform for optimiation of supplychain for the entire industry, not limited to how logistics are at individual companies.

On the other hand, pharmaceutical wholesalers has become more  involved in logistics for manufacturers to final distributions to patients. Especially, regenerative medicine products are increasingly needed to integrate the sales channels and logistics, which requires the wholesalers to be closely aligned with logistics businesses.

Research Outline