IMS health estimates the CAGR (Compound Annual Growth Rate) for global pharmaceutical sales of over $1B from 2014-2019 will be approximately 5%. Thus, the amount of losses incurred in total dollars will continue to rise in a similar fashion unless better preventative measures are put in place to ensure a more effective set of Standard Operating Procedures (SOP).
Cold Chain Shipping Loss in Pharmaceuticals
In 2014, the pharmaceutical industry had sales of $790 Billion in non-cold-chain (77.8%) and $225 Billion in Cold-chain or controlled room temperature (22.2%) products. That totals $1.015 Trillion. If we estimate a 5% CAGR (compound annual growth rate) then by 2019, that number will be $1.36 Trillion.
The losses associated with temperature excursions in healthcare come to $35 Billion. That is broken down as follows:
Within Clinical trials, the total loss of $5.65B is broken down further as follows*:
Loss is present across the industry in high numbers, for example:
A pallet of unprotected product on an airport tarmac with an ambient temperature of ~70°F (21°C) can quickly reach temperatures above ~130°F (55°C). At that temperature, you can fry an egg in 20 minutes.
So, What's a Billion Worth?
$16 Billion, which is the approximate costs incurred by the top ten pharma firms due to temperature excursions, is 20 times the average price to earnings ratio of big pharmaceutical firms.
$320 Billion, which is the total corporate value wasted due to temperature, is larger than the 2015 total market capitalization of Johnson & Johnson ($274 Billion).
* = Ray Geoff, Wyeth Vaccines—white paper entitled "Cold Chain to Clinical Site: The Shipping Excursions", indeed website salary estimates
Other sources: World Health Organization (WHO); Parenteral Drug Associate(PDA); worldpharmaceuticals.net; other industry estimates.