Development of a clinical trial logistics service offering
The health care industry business unit at logistics service provider (3PL) was concerned with the lack of new product/services introductions in recent years and its impact on future financial performance. This concern was accentuated by the shrinking margins it earned in its mature service offerings. The objective of the engagement was to identify new services and market niches that could create unique value for customers and at the same time re-invent its new product development capability.
- Market assessment: Surveyed the health care market and identified opportunities for differentiated logistics services, with sustainable value propositions.
- Internal capabilities assessment: Identified the 3PL’s relative strengths and weaknesses relevant to the opportunities.
- Prioritization: Of the top opportunities identified, clinical trial logistics was identified as an underserved segment with technical and service requirements that would be challenging for competitors replicate.
- Business planning: Preparation of the clinical trial logistics market entry strategy and implementation plan.
- Successful entry into the market with 3-year EBIT CAGR exceeding 30%.
- Operating margins of 2-3x of the more mature service lines.
- Clinical trial logistics service offering provided early visibility and customer access to subsequently capture the production-distribution supply chain business once the therapy received regulatory approval.