Logistics: Delivering pharmaceuticals safely and quickly is big business globally and at Luxembourg’s Findel airport.
Photo: LaLa La Photo
One of the three fastest growing logistics categories globally is the transport of pharmaceuticals. “There is a massive shift from traditional warehousing to specialized logistics centres as they add value to the chain”, noted Tony Wright, CEO of Exelsius, in his keynote speech during the Cluster for Logistics Luxembourg’s “Autumn Evening” dedicated to security and quality when dealing with healthcare products.
Luxembourg’s Findel is the first airport in the world whose special facility, built in 2013 for the purpose of transport and storage of pharmaceuticals, was granted the Good Distribution Practice Certificate to all parties involved in the logistics process.
The added value when shipping through specialised facilities is, among others, the safety of the transport. Mark Gruentjes from the non-profit Transported Asset Protection Association highlighted that, as estimated by the EU, the theft of products moving in supply chains in Europe cost businesses over €8.2bn each year. “And the problem is escalating. The losses include not only the financial cost of recovery, but also the inability to fulfil customer orders, reputational damage, disrupted productivity and stolen data”, Gruentjes pointed out.
€1m loss times 5
What are the thieves after? Tobacco, electronics, good wine, leather goods, watches, tyres, but also pharmaceuticals. As noted by Carlo Thelen, board chair of the Cluster for Logistics and managing director of the Chamber of Commerce, the value of a single pharmaceutical pallet often exceeds €1m.
In the pharmaceutical sector the true cost of loss is estimated by TAPA at fivefold the value of the stolen goods: apart from the replacement cost, loss of sales, reputational damage and investigation spending, there is also the cost of drug inspection, product disposal, quarantine, and often the need to withdraw the whole lot of a medicine from the market.
When shipping by air one of the main problems the pharmaceutical industry is faced with is lack of standard transport containers. ISO certified packaging exists in land and sea logistics, but is yet unavailable for air cargo. “Due to often poor, not standardised packaging loss and damage risk in air transport is much higher than it could be,” commented Redwane Chani from Interbox Holding. “It also results in higher theft and tampering ratios as content is easily recognisable by criminal groups”.
His company, together with three others gathered in a consortium (De Richard, EyeDPro, Leap Development), is working on a smart, universal air transport container. “With the support of the European Commission we hope to introduce a packaging standard box that will use smart components, ensure control through shipment tracking sensors and help analyse transportation data. Top security will be additionally enhanced through an electronic locking mechanism, with PIN code access granted only to verified users, tampering detection sensors, and real-time alerts”, said Chani.
Faster, cheaper, better?
Increased security and innovation of transport must, however, come at a cost. “It is impossible to ensure the best practices if price is the only decision factor when companies choose logistics partners,” stated Wright. “Fast and cheap may not be effective, cheap and effective may not be fast, and fast and effective may not be cheap”.