The cool chain has seen significant investment in digitalisation and the Internet of Things (IoT), providing near real-time interaction with the supply chain.
“We have observed a continued growth in demand of over 20 percent year upon year. This growth is partly driven by new pharmaceutical products—such as weight loss and cancer drugs Richard Ettl, CEO and Co-founder of SkyCell, stated.
Amid that change, sustainability has become a critical factor—it’s no longer optional. Many countries are introducing fees for packaging disposal, which needs to be included when calculating the Total Cost of Ownership (TCO) of pharma products. With that in mind, co-founder and SkyCell’s CTO Nico Ros introduced a new formula for this at Logipharma 2024 in Lyon as risk and cost and CO2e, as the old model focused on risk and cost, without including CO2e.
“Changing climate conditions—more extreme heat and cold—means that packaging solutions that may have worked a decade ago are now producing higher rates of product loss,” Ettl added.
Competitive market
The pharma industry is very risk-averse—and for good reason. A change in supplier or processes could result in cost savings of US$1 million. However, if it fails—resulting in lost sales, additional costs, and putting patients’ lives at risk—it could have a ripple effect of US$10-100 million in losses.
“This is why pharma companies select their partners very carefully. They make their decisions based on several factors, including temperature control performance, global reach, sustainability, financial stability, and container fleet size,” Ettl continued.
“Most pharma companies won’t even consider a supplier with less than 2,000 containers which has intensified the competition in the industry for one-way packaging providers. To gain an edge, companies need to excel in each of these areas while making it easy for pharma companies to implement their solutions.”
Increased visibility
Digitalisation of the supply chain is key to reducing risk, costs, and CO2e. Software integrations and intervention capabilities are set to become mandatory across the cool chain. With solid data collection methods and analytics, artificial intelligence can then be leveraged to gain insights that aren’t possible today or are only discovered when it’s too late to act on them.
“Companies like Validaide have pioneered risk lane assessments and collected data from thousands of players in the industry, helping reduce risk and costs. However, they don’t have the latest methodologies for calculating and reducing CO2e,” Ettl outlined.
“That’s why we’ve decided to partner with them to integrate the latest calculation methods, such as those from MIT’s latest study on the CO2e of packaging solutions. This study is crucial as current ISO and GLEC standards do not incorporate the volumetric weight of packaging.
“As pharma products are often very lightweight in comparison to other products, these standards massively underreport CO2e, especially in airfreight. This partnership will help our clients reduce risk, cost, and CO2e in their operations.”
