UPS to manage most of Merck’s U.S. distribution

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UPS announced it has been selected by Merck & Co. to manage a significant portion of its U.S. distribution of pharmaceuticals and vaccines, as well as to provide package transportation services. UPS says that through its Supply Chain Solutions subsidiary, it has assumed control of two key Merck distribution centers, which provide Merck with temperature-sensitive storage, packaging and transportation services critical to its pharmaceutical and vaccine products.

The majority of Merck’s U.S. vaccines and pharmaceutical volume flow through these two centers located in suburban Atlanta and Reno, Nev. UPS says the two U.S. facilities are cGMP-compliant and add more than 200,000 square feet of secure, automated healthcare logistics space to its network, joining its 23 existing compliant healthcare facilities in North America, as well as two soon-to-open healthcare facilities in Puerto Rico and The Netherlands. In total, UPS says it will have more than 3.5 million square feet of dedicated healthcare space globally.

UPS says this transaction allows it to leverage the new facilities for other healthcare customers and allows Merck to take advantage of its existing healthcare distribution network, while also allowing Merck to utilize a broad spectrum of UPS services to gain additional supply chain flexibility needed for initiatives such as new product launches. Through this arrangement, Merck will be able to improve its cost structure while providing enhanced customer service, according to UPS.

In addition to shipping expertise, UPS services that now will be available to Merck include storage, warehousing, order fulfillment and shipping of pharmaceuticals and vaccines. UPS says it will assume responsibility for the movement of all package volume for product to the U.S. market.

“Our latest initiative with Merck marks the next step in our relationship to meet this customer’s evolving needs,” says Bill Hook, UPS vice president of global strategy, healthcare logistics. “UPS has invested heavily to provide healthcare customers such key advantages as integrated supply chain solutions combining multiple modes of transportation, plus dedicated healthcare facilities that help them speed new products to market, navigate regulatory compliance and respond to evolving industry demands.”