Nippon Express acquires MD Logistics, building up its pharma base

In a flurry of announcements in August and early September, Nippon Express Co. has enhanced its service offerings to life sciences, having identified that industry as a business priority going forward. In the US, it closed its previously announced deal to acquire MD Logistics and MD Express, an Indianapolis-based, mid-sized logistics provider (2019 revenue, according to Nippon, was $50.1 million). Simultaneously, it cut the ribbon on a new distribution center in an existing Chicago facility, dedicated to life sciences and certified to Good Distribution Practices (GDP) standards.

In mid-August, it also announced the commencement of constructing a new distribution center near Schipol Airport (Netherlands), also maintaining GDP standards. The facility will double Nippon Express’ existing capacity, spanning 12,238 sq. m. (132,000 sq. ft.) when it opens in July 2021. It is also setting up pharma-specific facilities in East Japan, West Japan, Kyushu and Toyama, complementing existing facilities at Narita and Kansai International Airports. Internally, it plans to acquire ground vehicles for temperature-controlled delivery service, and is working with Intel to design hardware and software for a new supply-chain management system.

Many global logistics companies are expanding or upgrading their life sciences facilities in anticipation of distributing Covid-19 vaccines and medical gear (when they become available), but Nippon Express (2019 revenue: $20.9 billion) has been on this kick for over a year. Last October, it announced its intention to join a CEIV Pharma community at Narita International Airport (CEIV Pharma is a program run by the International Air Transport Assn. to certify GDP-compliant services); the life sciences emphasis is part of a five-year plan culminating in 2023.