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OUTSOURCING INSIGHTS REPORT Survey Methodology: Nice Insight conducted a supply chain survey targeting 100 supply chain decision makers. The survey was comprised of 30 questions geared toward understanding current supply chain needs and practices, present and future expectations from logistics providers, and which services and traits infl uence provider selection. LIFESCIENCELEADER.COM 18 NOVEMBER 2014 If you want to learn more about the report or how to participate, please contact Nigel Walker, managing director, or Kate Hammeke, director of marketing intelligence, at Nice Insight by sending an email to nigel@thatsnice.com or kate.h@thatsnice.com. N . W A L K E R Customer service is followed by more specialized services such as pharmaceu- tical lifecycle management, where stor- age, distribution, and reverse logistics are all handled by the provider — an area where a specialty company has a clear advantage. Depot facilities that offer drug return and destruction services, as well as retest labeling for clinical trials materials, are additional areas where biopharma companies desire solutions that specialty companies are best posi- tioned to fulfill. It's not surprising that logistics giants are perceived to be more affordable than specialty providers, or that price ranked fourth in importance, after quality, reli- ability, and regulatory knowledge. Both of these statements — along with 49 per- cent of respondents stating they "select a logistics provider based on project best fit" when asked about pricing tolerance — support use of a combination of global and specialty providers. Thus, it is inter- esting and somewhat conflicting to see that price came in as the top reason buy- ers would consider switching from their current supplier. While global companies continue to fine-tune their offerings in order to remain top of mind among customers in the life sciences market, it will be interesting to see whether these companies are able to develop the same quality of service for life sciences' specialized needs and keep their reputation for being more affordable. L Strategic Motivations For Engaging Third Party Logistics Providers Figure1 Desired Technologies And Services In Logistics Providers Figure2 24/7 Customer Service Pharmaceutical Lifecycle Management Customized Solutions Improved Track and Traceability Depot Facilities that Offer Drug Return and Destruction Services Single Supplier to Maintain Entire Clinical Supply Chain Reduce Costs Associated with Transportation, Warehousing, and Supply Chain Management Preclearance at Customs / Prepayment of Tariffs and Taxes Cold Chain Sustainability Improvements Primary and/or Secondary Packaging Services 64% 52% 41% 58% 50% 40% 52% 41% 31% 20% Real-time Traceability for Shipments Logistical Locations Regulatory Expertise Third Party System Separation Mitigated Risk Consolidated Buying Power 63% 54% 56% 41% 54% 37% By K. Hammeke LOGISTICS PROVIDERS STRIVE TO FULFILL BIOPHARMA NEEDS – SPECIALTY COMPANIES OFFER ADVANTAGES, BUT GET A BAD RAP ON PRICE