DHL signs deal to help Shanghai Pharma grow

Shanghai Pharma, one of China’s largest listed pharmaceuticals groups, has signed a Memorandum of Understanding (MOU) with DHL Supply Chain to expand its global logistics infrastructure.
Under the MOU, the pharmaceuticals giant – which generated revenues of more than
US$18 billion (RMB121 billion) last year – will partner with DHL Supply Chain to enhance quality control measures, streamline distribution processes, and strengthen local and international regulatory compliance.
The MOU will grant Shanghai Pharma priority access to DHL’s global logistics network including temperature-sensitive life sciences services to Europe. DHL Supply Chain will also support Shanghai Pharma’s supply chain optimization needs as the manufacturer ramps up its overseas distribution and retailing efforts.
The Chinese government has recently been putting pressure on China’s pharmaceutical sector to improve the transparency and efficiency of local supply chains.
Shanghai Pharma president and executive director, Cho Man, said: “The quality and resilience of our logistics infrastructure will determine not only how successfully we adapt to new legislation– which seeks to cut down on multiple distributors and mark-ups by only allowing two invoices per goods shipment – but also our ability to capitalize on the huge international growth opportunity for high-grade Chinese pharmaceutical products and medical devices.”.
“China’s national market for drugs has grown rapidly in recent years to become the world’s second-largest with an estimated growth to around US$167 billion by 2020[2]. Our partnership with DHL will help Shanghai Pharma to become one of the world’s foremost pharmaceutical manufacturers – supported by a global distribution network that combines world-class quality control with fast, seamless delivery.”
DHL Supply Chain chief executive for Greater China, Yin Zou, added: “China’s pharmaceutical industry has historically suffered from high levels of fragmentation amongst its local customers and distributors, an issue which recent legislative changes…have sought to combat. In this regulatory climate, end-to-end supply chain management plays an increasingly crucial role in determining how effectively Chinese pharmaceuticals firms not only maintain sales locally, but gain traction abroad in a cost-effective and sustainable manner.”