A FedEx employee walks previous his truck within the North Seashore neighborhood on June 23, 2026 in San Francisco, California.
Heather Diehl | Getty Photographs
As demand rises for specialised medicines like GLP-1s, logistics firms together with UPS and FedEx are adapting their methods to have the ability to higher ship and retailer these prescription drugs.
Most injectable GLP-1 medicines, together with Novo Nordisk‘s Ozempic and Wegovy and Eli Lilly‘s Mounjaro and Zepbound, require refrigerated storage for cargo.
The Covid pandemic put healthcare logistics at middle stage in 2020, because the transport of temperature-controlled vaccines rapidly turned an important a part of protecting the virus at bay. And as extra money has been poured into new pharmaceutical improvements, the transportation of these merchandise have come below the highlight.
Logistics firms are actually investing hundreds of thousands of {dollars} and strengthening dozens of temperature-controlled services to faucet into the market.
In June, UPS introduced a brand new $48 million funding in temperature-controlled services because it sees a rising demand for crucial therapies. In accordance with Progress Market Reviews, the demand for temperature-sensitive biologics is projected to develop at an 8.3% compound annual development charge via 2033 and attain a market worth of roughly $39.1 billion.
Weight problems and diabetes medication, in the meantime, have been booming in recognition. A July Gallup ballot discovered that 11% of People take GLP-1 medicines for weight reduction functions in 2026, up from simply 3% in 2024.
But when they are not saved and shipped on the right temperature, they threat shedding their efficacy.
The Meals and Drug Administration has warned that improper storage throughout transport can have an effect on the medication’s high quality and recommends sufferers don’t use GLP-1 medication that arrive “heat or with inadequate refrigeration.”
Different biologics, like some vaccines, insulin and antibiotics, additionally require specialised cargo to take care of efficacy. For logistics firms, which means making certain the right storage and motion each step of the best way.
Bulking up
Healthcare logistics have confirmed to be considered one of UPS’ largest alternatives. On an earnings name with analysts in April, CEO Carol Tomé stated the corporate’s world healthcare portfolio has gained market share yearly since 2021, producing its first ever $3 billion healthcare income quarter within the first quarter of this yr.
UPS President of Healthcare John Bolla informed CNBC that the corporate is seeing extra healthcare firms on the lookout for companions to maintain up with the quantity.
“One of many largest alternatives we see is supporting the shift towards extra specialised therapies and extra care delivered exterior of conventional healthcare settings,” Bolla stated.
United Parcel Service vans are parked at a UPS buyer middle in Los Angeles on April 1, 2024.
Mario Tama | Getty Photographs
He stated UPS is experiencing “speedy development” in biologics, cell and gene therapies, although the largest problem is that the margin for error is small — even a quick stray from the right temperature can wreck the medicines, Bolla stated.
“However that is additionally what’s creating such a major alternative in healthcare logistics,” he stated. “As therapies turn into extra specialised and provide chains turn into extra complicated, healthcare firms want companions that may present not simply temperature-controlled storage or transportation, however end-to-end visibility, management and reliability throughout all the community.”
FedEx can also be tapping into the development, launching a life sciences group earlier this month particularly to assist the motion of prescription drugs and different healthcare merchandise.
On an earnings name in June, FedEx’s Chief Buyer Officer Brie Carere informed analysts that healthcare transportation income in fiscal yr 2026 reached almost $10 billion.
“We’re constructing end-to-end options centered on world pharma prospects, and what’s so essential with world pharma is that it’s a must to acknowledge that there is a affected person on the finish of each supply or somebody that is ready to be handled,” stated Nick Gennari, FedEx’s president of healthcare. “So we take this very, very significantly.”
With GLP-1s particularly, Gennari stated there’s an growing complexity to delivering these medicines, with varieties starting from injectables to oral capsules and going direct-to-consumer. However with that complexity comes a development alternative for FedEx, which he stated is “ideally positioned.”
Gennari stated FedEx has specialised know-how, together with its machine studying engine that enables prospects to see product motion with predictive skills, in addition to its know-how that identifies healthcare merchandise and treats every otherwise relying on its distinctive wants.
Gennari additionally stated he is “very snug” with the corporate’s base capabilities and its plans for growth, together with cold-chain logistics.
“A lot of the infrastructure that is required to achieve success on this area, we have already got. We have now the airline; we’ve got an unimaginable schedule; we’ve got the raise capabilities. The community is hardened and works very effectively,” he stated.
Complicated provide chains
C.H. Robinson informed CNBC the logistics firm had surpassed $1 billion in income in healthcare logistics alone over the previous yr, largely because of the development in GLP-1 medication, because it has been investing in temperature-controlled services.
“You should actually have that end-to-end connectivity, so you have to have a very nice community and infrastructure constructed out as a way to correctly service the healthcare prospects,” stated Ronnie Davis, the corporate’s vice chairman of North American floor transportation.
Davis stated the provision chain for medicines has additionally turn into extra difficult. Along with requiring refrigeration, many medication have a brief shelf life and have to be delivered in exact home windows of time.
“Numerous the innovation has been on getting the medication to the market,” Davis stated. “I believe what you are beginning to see is that is actually placing stress on the capabilities of the chilly chain provide chains within the market. … With the rise of GLP-1s and different specialised medication, it is actually making a aggressive nature for a similar refrigerated provide sources which are there and, fairly candidly, that provide isn’t limitless, it is constrained.”
Davis stated C.H. Robinson is working to amp up its capabilities, particularly to maintain up with the upper quantity. On the identical time, he added, pharma firms are additionally making an attempt to get artistic to deliver their merchandise to market with an extended shelf life.
That innovation can also be intersecting with the expansion of synthetic intelligence capabilities, in line with Hendrik Venter, CEO of DHL Provide Chain. The logistics firm makes use of AI to watch crucial life science merchandise, monitoring temperatures and anticipating the place a problem may occur.
“You are seeing the business transferring from standard to biopharma,” Venter informed CNBC. “You should have a provide chain that’s resilient and able to transport in all of those varied temperature zones.”
The corporate introduced final yr that it plans to take a position 2 billion euros ($2.25 billion) in well being logistics by 2030, with half of that allotted to the Americas.
Numerous pharmaceutical firms are additionally outsourcing their warehousing actions to DHL, Venter stated. The corporate takes over these services, manages them and integrates them into the remainder of their community.
DHL launched a pharmaceutical air hall world wide, with a devoted plane and related community that ensures the medication are usually not being shipped via separate regulatory environments.
“You can’t lose a cargo. You can’t exchange it. It must be delivered on time, each time, in the fitting high quality and temperatures,” Venter stated. “So we proceed to selectively have a look at methods to strengthen that community.”