Healthcare Third-Party Logistics Market Size, Share, and Trends 2024 to 2033

Healthcare Third-Party Logistics Market Size and Growth

The global healthcare third-party logistics market size was USD 220.15 billion in 2023, calculated at USD 236.97 billion in 2024, and is expected to reach around USD 459.68 billion by 2033, expanding at a CAGR of 7.64% from 2024 to 2033. The rising developments in the pharmaceutical industry across the world are driving the growth of the healthcare third-party logistics market.

Healthcare Third-Party Logistics Market Key Takeaways

• The North America healthcare third-party logistics market size reached USD 94.66 billion in 2023 and is predicted to cross around US$ 199.96 billion by 2033, at a CAGR of 7.76% from 2024 to 2033.
• North America led the market with the largest revenue share of 43% in 2023.
• Asia Pacific is expected to grow at the fastest CAGR of 9.12% during the forecast period.
• By industry, the biopharmaceutical segment has held a major revenue share of 64% in 2023.
• By industry, the medical devices segment is projected to grow at a solid CAGR of 10.72% during the forecast period.
• By supply chain, the non-cold chain segment has contributed more than 81% of revenue share in 2023.
• By supply chain, the cold chain segment is estimated to grow with the highest CAGR of 10.53% during the forecast period.
• By service type, the warehousing and storage segment has recorded more than 44% of revenue share in 2023.

Healthcare Third-Party Logistics Market Size and Growth 2024 to 2033

The U.S. healthcare third-party logistics market size was valued at USD 71 billion in 2023 and is expected to be worth around USD 150.97 billion by 2033, at a CAGR of 7.83% from 2024 to 2033.

North America held the largest market share in 2023 and is expected to maintain its dominance throughout the forecast period. The growth of this region is mainly driven by rising government initiatives in countries such as the US, Canada, and Mexico to develop healthcare infrastructure. For instance, in May 2024, the FDA (the U.S. Food and Drug Administration) announced a new initiative named ‘the Home as a Health Care Hub’ for developing the healthcare sector across the U.S. The rising developments in healthcare warehouses, along with the growing presence of well-established air and sea freight, are driving the market growth in this region. Moreover, the advancement in internet facilities, along with the rising penetration of smartphones, has boosted the healthcare third-party logistics market growth in this region.

The presence of a well-developed pharmaceutical and biopharmaceutical sector in this region propels the market growth. Furthermore, the presence of several healthcare third-party logistics companies such as C. H. Robinson, Amerisource Bergen, United Parcel Service, Barrett Distribution, Xpo Logistics, and some others boost the growth of the healthcare third-party logistics market.

• In September 2022, AmerisourceBergen announced a partnership with Outlook Therapeutics, Inc. Through this partnership, AmerisourceBergen will provide third-party logistics (3PL) services in the U.S. for distributing Outlook Therapeutics’s ONS-5010 therapy for the treatment of Wet AMD.

Asia Pacific region is expected to be the fastest-growing region during the forecast period. The growth of this region is mainly driven by the growing developments in the medical devices industry in several countries such as India, China, South Korea, and others. Also, the growing interest from the public and private sectors for development & research for developing healthcare logistics industries has boosted the market growth. The growing advancements in pharmaceutical industries, along with rising developments in bio-therapeutics sectors, are driving the market growth. Furthermore, the presence of several healthcare logistics providers, such as Kerry Logistics Network Ltd. and Agility, drives the growth of the healthcare third-party logistics market.

• In May 2023, UPS Healthcare inaugurated a healthcare warehouse in Singapore. This new warehouse is built with an area of 8,700 sqm and helps in labeling, packaging returns logistics, local customs brokerage, and some other operations in the Asia Pacific region.
• In October 2023, Agility signed a memorandum of understanding (MOU) with the government of Saudi Arabia. This collaboration is aimed at developing a well-organized supply chain of healthcare products across Saudi Arabia.

Market Overview

The third-party logistics market is an important industry in the healthcare domain. This industry deals in the storage and transportation of healthcare products across the globe. The healthcare third-party logistics market is expected to grow significantly with the rise in government initiatives to develop the healthcare sector. This industry mainly deals with delivering products such as biopharmaceutical, pharmaceutical, and medical devices to people across the world. It comprises two supply chains, the cold chains, and the non-cold chains. There are several services associated with healthcare third-party logistics, such as freight services, warehousing & storage, database management, and other custom operations. Logistics companies have also started developing modern warehouses to store healthcare products and boost market growth. This industry is expected to grow exponentially with the growth in the healthcare and logistics sectors.

Healthcare Third-Party Logistics Market Growth Factors

• The technological advancements in the healthcare industry are expected to drive the growth of the healthcare third-party logistics market.
• The rising government initiatives to strengthen the medical sector have driven the market growth.
• The growing developments in the air transport infrastructure across the world foster market growth.
• The rising adoption of online shopping and integration of modern technologies has boosted the market growth.
• The rising investments from public and private sector entities for developing the third-party logistics industries also boost the market growth.
• The growing penetration of the internet, along with the rising use of smartphones across the world, drives the market growth.
• The growing developments in pharmaceutical industries are likely to impact the market positively.
• The rise in the number of warehouses for logistics purposes also propels market growth.
• The growing advancements in freight infrastructure across the world foster healthcare third-party logistics market growth.

Healthcare Third-Party Logistics Market Scope

Healthcare Third-Party Logistics Market Dynamics

Driver

Rising developments in warehouses for storing medicinal products

The growing demand for medicines across the world increases the demand for modern warehouses with superior facilities. Also, the growing proliferation of smartphones has increased the demand for purchasing medicines and other associated products from online platforms, which increases the demand for storage facilities across the world.

The advancements in logistics sectors associated with the storage and distribution of healthcare products are developing rapidly. Moreover, healthcare and logistics companies started establishing new storage facilities to maintain the demand and supply chains of healthcare products across the world.

• In April 2024, Cardinal Health announced the opening of a logistics center in Columbus, Ohio, U.S. This logistics center will be constructed in a huge area of 350,000 square feet for smooth distribution of over-the-counter consumer health products among the people, along with developing its pharma business.

Restraint

Theft-related issues, along with a lack of logistics infrastructure in rural areas

The logistics industry is developing significantly with the growing trend of online shopping across the world. However, there are various problems associated with healthcare logistics. Firstly, there are theft-related issues during the transportation of medical goods and a mismatch of medical products in warehouses. Secondly, the logistics sector in rural areas faces several transportation and storage issues for medicinal products. Thus, the absence of well-established logistics in rural areas, along with theft-related issues in the logistics sector, is expected to restrain the growth of the healthcare third-party logistics market.

Opportunity

Adoption of modern technologies in logistics

The logistics industry has developed rapidly due to the advancements in sciences and modern technologies. The ongoing development of modern technologies such as Big Data Analytics, AI, Blockchain, and others have also contributed significantly to the development of the logistics sector. The integration of technologies in modern warehouses also helps in packaging, manufacturing, database management, enhanced warehouse safety, and some others that help in maintaining logistics operations. Thus, rising developments in technologies in the logistics sector are expected to create ample growth opportunities for the market players in the future.

• In November 2023, Meihua International launched Speed Fox. Speed Fox is an innovative artificial intelligence (AI) enabled warehouse management system that helps in logistics operations for the healthcare sector.

Industry Insights

The biopharmaceutical segment held the largest healthcare third-party logistics market share in 2023 and is expected to continue its dominance during the forecast period. The growth of this segment is generally driven by the growing demand for biopharmaceutical therapies for treating diabetes, autoimmune disorders, and cardiovascular diseases across the world. Moreover, the growing research and development activities associated with bio-based drugs, along with a rising number of clinical trials associated with biosimilars, also boosts the market growth. Also, biopharma companies have started adopting several strategies such as product launches, approvals, partnerships, acquisitions, collaborations, and some others for treating several diseases, which in turn drives the growth of the healthcare third-party logistics market during the forecast period.

• In April 2024, Sanofi announced a partnership with Dr. Reddy’s Cipla and Emcure Pharma. This partnership is being done to launch first-class drugs in India.

The medical devices segment is expected to be the fastest-growing segment in 2023. The growth of this segment is generally driven by the growing development of healthcare infrastructure across the world. Also, the rising use of medicinal devices in hospitals and laboratories for various diagnostic procedures drives market growth. Moreover, the rise in the number of surgeries associated with chronic diseases increases the demand for medical devices, thereby driving market growth. Furthermore, the presence of well-established medical device companies that are engaged in R&D activities for developing medical devices and adopting strategies such as product launches, partnerships, and approvals, thereby driving the growth of the healthcare third-party logistics market.

• In March 2024, Stryker launched a new medical device in Europe. This medical device is named the ‘Gamma4 Hip Fracture Nailing System’ and will help surgeons treat femur and hip fractures.

Supply Chain Insights

The non-cold chain segment dominated the market in 2023. The growth of this segment is generally driven by the growing development in logistics sectors across the world. Moreover, the rising trend of online shopping for purchasing medicines has increased the demand for non-cold chain warehouses for storing medicines, thereby driving market growth. Also, the rise in the number of SKUs (Stock Keeping Units) for inventory management of medicinal devices, tablets, capsules, and other medicinal products further drives the growth of the healthcare third-party logistics market.

The cold chain segment is estimated to grow with the highest CAGR during the forecast period. The growth of this segment is driven by the growing number of immunization initiatives across the world. For instance, in February 2024, the government of India announced a new vaccination initiative to prevent cervical cancer among girls children aged 9-14 years.  Moreover, the rising prevalence of chronic diseases such as cardiovascular diseases, stroke, arthritis, and others increases the demand for vaccines associated with their treatment. These vaccines must be kept in cold-chain warehouses, thereby driving the growth of the healthcare third-party logistics market. Also, the rising trend of connected cold chain solutions due to added advantages compared to conventional storage methods boosts market growth.

• In June 2024, Overhaul launched a software solution. This software is called ‘cutting-edge Cold Chain Quality Solution’ and helps in delivering quality and risk management for storing and transporting products from several end-user industries, including healthcare, pharmaceutical, and food and beverage sectors.

Service Type Insights

The warehousing and storage segment held the largest market share in the healthcare third-party logistics market. The growing demand for medicines across the world has driven the market growth. Also, the rising integration of artificial intelligence (AI) and other technologies in modern warehouses to automate several tasks such as packaging, inventory management, data analysis, and others is driving the growth of the healthcare third-party logistics market.

The growing number of medicine storage warehouses in several countries, such as India, the U.S., and Canada, has driven the market growth. Moreover, the growing investment by 3PL companies in developing new healthcare warehouses with modern facilities across the world is boosting the growth of the market.

• In April 2024, DHL Group announced that it would invest $200 million to expand in the life sciences and healthcare logistics sectors. This investment mainly aimed to open 5 new warehouses for storing healthcare products in Pennsylvania and North Carolina in an area of more than 13 million square feet.

Healthcare Third-Party Logistics Market Companies

• Cardinal Health
• DHL Group
• Agility
• Kinesis Medical B.V.
• United Parcel Service of America, Inc.
• Barrett Distribution
• SF Express
• Amerisource Bergen Corporation
• DB Schenker
• FedEx
• KUEHNE + NAGEL
• Freight Logistics Solutions
• Kerry Logistics Network Ltd.

Recent Developments

• In May 2024, Kuehne+Nagel launched a new road logistics service in Europe. This new service is launched for the transportation of medical technology devices in several countries such as France, the UK, Germany, the Netherlands, Spain, and Italy.
• In February 2024, FedEx Express inaugurated ‘FedEx Life Science Centre’ in Mumbai, India. The new facility is opened to support the clinical trial storage and logistics requirements of healthcare consumers in and out of India. 
• In November 2023, United Parcel Service of America, Inc. launched a new software named ‘Symphony’. This new software integrates various supply chain components such as shipping, inventory management, warehousing, and others in a single platform.
• In March 2023, DB Schenker inaugurated a new warehouse facility at the Schiphol Airport in Benelux. This new facility was opened to store healthcare-related goods and handle pharma products.
• In November 2022, Kenco Group announced the opening of a new Life Sciences Division. Through this launch, the company aims to expand transportation, distribution, material handling, and supply chain services.

Segments Covered in the Report

By Industry 

• Biopharmaceutical
  • Vaccines
  • Plasma Derived Products
  • Others
• Medical Device 
  • Class I
  • Class II
  • Class III
  • Pharmaceutical

By Service Type

• Transportation
• Air Freight
• Sea Freight
• Overland Transportation
• Warehousing and Storage
• Others

By Supply Chain

• Cold Chain
• Non-Cold Chain

By Geography

• North America
• Europe
• Asia Pacific
• Latin America
• Middle East and Africa