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Home » Research ranks top pharma DC hubs

Research ranks top pharma DC hubs

From Staten Island, N.Y., to Rocky Mount, N.C., cities up and down the East Coast are home to a growing wave of cold chain facilities for pharmaceutical and biotech industries—an accelerating trend as U.S. awaits Covid-19 vaccine.

Research ranks top East Coast pharma DC hubs
September 10, 2020
Supply Chain Quarterly Staff
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Commercial real estate firms and third-party logistics services (3PL) providers are gearing up for a wave of supply chain facilities designed to serve pharmaceutical and biotechnology industries, especially as researchers expedite the development and production of a Covid-19 vaccine. Much of this “cold chain” space is springing up along the densely populated East Coast, which is already home to hundreds of millions of square feet of distribution and fulfillment space thanks to a booming e-commerce market, according to Princeton, N.J.-based site selection firm, The Boyd Co.

Boyd released a list of the top 25 cities for pharmaceutical distribution centers (DCs) this week, ranked according to operating costs. The top cities were selected based on their proximity to regional pharmaceutical production hubs (generally two hours or less), transportation infrastructure, real estate inventories for new supply chain development, life science labor market access, and other logistics considerations, the company said. The list ranges from high-cost Staten Island, N.Y., to more affordable Rocky Mount, N.C., with locations as far north as New Hampshire and south to Florida, in between. (See Table)

TOTAL ANNUAL OPERATING COST RANKING
Pharma Supply Chain Hub Total Annual Operating Costs
Staten Island, New York $27,507,051
Farmingdale, New York $26,711,291
Stoughton, Massachusetts $25,725,995
Worcester, Massachusetts $25,688,851
Edison, New Jersey $24,913,354
Cranbury, New Jersey $24,174,656
King of Prussia, Pennsylvania $24,092,580
Windsor, Connecticut $23,885,092
Nashua, New Hampshire $23,634,121
Florence Twp., New Jersey $23,453,662
Newburgh, New York $22,859,580
York, Pennsylvania $22,700,084
Canonsburg, Pennsylvania $22,195,427
Lehigh Valley, Pennsylvania $22,162,826
New Castle, Delaware $22,068,482
Alpharetta, Georgia $21,651,901
Towson, Maryland $21,539,675
Lakeland, Florida $21,206,645
Doral, Florida $21,198,697
Lithia Springs, Georgia $20,983,023
Indiantown, Florida $20,898,324
Ruskin, Florida $20,325,004
Chesterfield, Virginia $19,811,571
Mebane, North Carolina $19,451,226
Rocky Mount, North Carolina $18,155,234
Source: The Boyd Co.

Beyond Covid-19, general industry trends are also driving the demand for more cold storage space—temperature-controlled, refrigerated facilities designed to keep products such as drugs and food fresh and safe. Biologics—drugs and medicines developed from living organisms, including vaccines, blood, and viruses—are all driving new cold storage demands, the researchers said. Also fueling expansion is the growing popularity of online pharmaceutical delivery services such as Amazon’s “PillPack” and similar drugs-by-mail programs.

Boyd estimates the industry will need as much as 125 million sq. ft. of cold chain supply space to meet new demands, much coming from the pharmaceutical market. 

“A good example of new cold chain growth is third-party logistics supplier DHL which is expanding its pharma network by 40% and investing some $150 million in new facilities in major areas of pharma and medical devices production, most recently in Raleigh, North Carolina’s Research Triangle,” the researchers said.

Logistics Warehousing
KEYWORDS The Boyd Co.
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