“Project Sunrays: Getting ready for COVID-19 vaccines logistics by air” was the title of the first online media briefing held jointly by TIACA and Pharma.Aero on 14OCT20. Sunrays Project Lead and TIACA Board Member, Emir Pineda, and Pharma.Aero Chair and Sunrays Project Member, Nathan De Valck, reported on the first milestone result: an in-depth interview survey of 181 players across the pharma logistics supply chain, to establish the industry’s readiness for the upcoming COVID-19 vaccine transport challenge.
“As we all know, pharmaceutical manufacturers are racing to develop future COVID-19 vaccines and as the world is waiting, we see unprecedented levels of expectations, urgency, and
uncertainties,” Nathan de Valck set the scene. “Unprecedented” is probably one of the most used words when it comes to describing the current global pandemic situation, and there is
much around the vaccine challenge that is unprecedented, too: for one, it is a worldwide race with more than 180 COVID-19 vaccines being developed, for another, a couple of dozen vaccines are
currently at various stages of accelerated testing, and approvals are expected to be expediated, too, though predictions as to when a final vaccine (aside from the current unproven Chinese and
Russian versions being used before testing has been completed), will be available vary greatly from the end of this year, to early 2021, to in a year or more from now.
“The logistics industry is blind”
“Unknown” is another much-cited word in this context. Until a clear vaccine winner is established, practically all the input required for solid preparation is unknown and “the logistics industry is blind. There's a wide range of uncertainties relating to volumes production timelines, freight lanes, requirements for transport and storage. And all of this is affecting the decision-making process and the levels of preparedness. As a result, the decision-making process in the logistics sector looks like a risky gamble. How do you decide on what when and where to invest with no solid market information and in a challenging economic environment?”
That said, pharma transportation in itself is not entirely new. Project Sunrays conducted a survey to establish the status quo in the industry, carrying out 181 interviews with key players.
So, who is the most and who the least prepared?
The survey, which included a representative mix of freight forwarders (30%), airlines (26%), ground handlers (12%), airport operators (14%) and solution providers (18%), worryingly disclosed that those furthest from the shipper, but most involved in the handling process, namely the Ground Handlers, felt the least prepared and informed when it came to the question of readiness in handling COVID-19 vaccines. Next in line: the airports. Those most at ease with the situation, were the solution providers followed by the airlines – both of which are generally in close contact with pharma shippers and understand their requirements. Naturally, those players with experience in temperature-sensitive product transportation, and more specifically clinical trials logistics (20% of those surveyed), also felt more prepared than those for whom these kind of shipments will be new. That said, those familiar with clinical trial logistics are generally express services, in other words: their experience is with small shipments and not the expected massive bulk shipments for COVID-10.
Nevertheless, still only 28% of respondents consider themselves well-prepared, with 1 in 5 feeling very unprepared, and – on a scale of 1 to 10 (with 10 being excellently prepared), the average of all the responses came to 6.32. So there is yet a great deal of work to be done in preparation, information, training, planning, and infrastructure. All requiring time (an unknown factor) and investments.
Who will foot the bill for the investments?
Given that the industry is suffering financially, and that the vaccine transport challenge may turn out to be “one-off” project running over a specific, limited time-period, CFG asked the question to the panel as to whether any reluctance in investing money had been encountered. Neel Jones Shah, Flexport, was clear: “Honestly, I think that the traditional ROI calculation is being thrown out the window here, right? I mean, companies aren't going through the math in order to figure out if this investment is going to have a 5-year, 10-year, 20-year life.” Under these exceptional circumstances, any companies were answering the “call to save humanity,” and investing millions in preparation. He also pointed out that in many parts of the world “governments are stepping up and giving fairly large grants,” and that they would likely be the ones “footing the bill in order to get this distribution network up and running,” either in the form or grants or zero interest loans.
Nathan de Valck pointed out that much could be done to optimize existing infrastructures and processes, from packaging through to smart buildings and data-sharing. All measures that could help to temporarily increase capacities where required.
“Covid-19 is going to be the biggest product launch in the history of mankind” - Neel Jones Shah
Asked by another participant as to whether the vaccine shipments would displace general cargo on flights, Neel Jones Shah likened the challenge to an Apple product launch: “The reality of the situation is that COVID-19 is going to be the biggest product launch in the history of mankind. We all know when Apple launches a new product, what it does to capacity for everybody else. There is a big sucking sound, and all of that capacity goes towards shipping that single product. There is going to be an impact!” Even more so with the ongoing lack of belly capacity, and the surge in rates on tight routes, quite aside from the fact that pharma takes precedence over general cargo under normal circumstances anyway. Yet, the panel pointed to the challenge probably hitting next year (rather than this Christmas peak) and over a longer period of time into 2022, that possibly more preighters would be on the scene, and that it was anyhow not yet clear how much of the vaccine freight would need to go via air versus land transport.
The big questions are still open, yet as one of the Sunrays’ presentation slides stated: “Anticipation is essential, even with a lack of information.”
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