Healthcare
distribution involves transportation and delivery of pharmaceuticals, medical
devices and vaccines to healthcare facilities such as hospitals, retail and
mail pharmacies. Growing demand for medicines, medical equipment and vaccines
globally has prompted manufacturers to outsource distribution activities to
specialist healthcare distributors having nationwide warehousing and delivery
networks. This has streamlined pharmaceutical supply chains and ensured
uninterrupted availability of products at point of care. The global market is
driven by rising healthcare expenditure, aging population suffering from
chronic diseases and growth in generic drug sales.
The global
healthcare distribution market is estimated to be valued at US$ 1,633.1 Bn in 2024 and is expected to
exhibit a CAGR of 6.8% over the forecast period of 2024 to 2031.
Key Takeaways
Key players operating in the healthcare distribution market are
AmerisourceBergen Corporation, McKesson Corporation, Medline Industries,
Cardinal Health, Inc., PHOENIX Group, Shanghai Pharmaceutical Group Co., Ltd.,
Henry Schein Inc., Owens & Minor, Inc., Medline Industries, Rochester Drug
Cooperative, Inc., FFF Enterprises, Inc., Dakota Drug, Inc., Mutual Drug
Company, Shields Health Solutions, Value Drug Company, Consorta, Inc. Key
players are focusing on mergers and acquisitions to expand product portfolio
and geographical presence. For instance, in 2023, AmerisourceBergen acquired
pharmacies of Walgreens Boots Alliance to strengthen retail Healthcare
Distribution Market Trends.
The global
healthcare distribution market provides significant opportunities such as entry
of biosimilars and generic drugs, growing clinical trial material distribution,
expansion of cold chain logistics and investment in digitization of supply
chain processes. Key players are expanding globally through greenfield projects
and associations with local players in high growth emerging markets of Asia
Pacific, Middle East, Africa and Latin America. This will enable access to
large untapped customer base in these regions.
Market Drivers
Growing
prevalence of chronic diseases globally is a key driver for the healthcare
distribution market. According to WHO, chronic diseases accounted for 71% of
global deaths in 2019. Rising disease burden has increased demand for
medicines, medical devices and hospital supplies which is fostering growth of
healthcare distributors. Increased adoption of cold chain logistics for
temperature sensitive products such as vaccines and biologics by distributors
ensure last mile product quality and efficacy which is another market driver.
Market Restraints
Consolidation
of pharmaceutical supply chain resulting in fewer distribution centers and
emphasis on just-in-time inventory model can restrain market growth. Challenges
in maintaining complete temperature control during transportation of cold chain
products also act as a market barrier. Strict regulations for drug licensing,
import and transport of narcotics require high compliance cost which restraint
market especially in emerging regions.
Segment Analysis
The healthcare distribution market is dominating by pharmaceutical product
distribution, which accounts for around 40% market share. Pharmaceutical
product distribution comprises distribution of prescription and OTC drugs to
pharmacies, hospitals, and doctors. This segment is dominating as demand for
prescription and OTC drugs are high owing to rising prevalence of chronic
diseases.
The medical device distribution is the second largest segment in healthcare
distribution market. This segment deals in distribution of medical devices such
as diagnostic imaging equipment, dental equipment, endoscopy equipment and many
others to healthcare facilities such as hospitals, diagnostic centres and
clinics. Growing healthcare infrastructure especially in developing countries
is boosting the growth of this segment.
Global Analysis
North America is the fastest growing region in the global healthcare
distribution market. This is attributed to factors such as high healthcare
spending, presence of major market players and well-established healthcare
infrastructure in the US and Canada. According to statistics, the US healthcare
spending accounts for around 18% of its GDP.
Asia Pacific is expected to showcase highest growth rate during the forecast
period in healthcare distribution market. Developing healthcare infrastructure,
growing medical tourism, rising disposable incomes are some factors driving the
growth of this regional market. Additionally, countries like China and India
are witnessing increased FDIs in the healthcare sector which is positively
impacting the distribution of pharmaceuticals and medical devices.
Gets More Insights on, Healthcare
Distribution Market
About Author:
Money Singh is a seasoned content writer with over four years of
experience in the market research sector. Her expertise spans various
industries, including food and beverages, biotechnology, chemical and
materials, defense and aerospace, consumer goods, etc. (https://www.linkedin.com/in/money-singh-590844163)
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