This blog is part of InfoDesk’s latest series which explores the state of the life science supply chain in light of COVID-19. You can read our other blogs here or download the latest InfoGraphic here.
The world’s life sciences transportation infrastructure is trying to respond to the numerous demands and disruptions brought upon it from the emergence of the COVID-19 pandemic. This outbreak has caused a vastly increased need for medications, diagnostics and personal protective equipment. This supply demand coupled with reductions of air flights, travel restrictions and staffing challenges has embattled the industry for months. Stakeholders and expert advisors are now investigating collaborative efforts, alternative transport modes and even trying innovative solutions in order to meet global logistics needs.
Transportation Disruption and Industry Response
In the past months, the media has reported a great number of stories covering the topic of COVID-19-associated transportation disruption of needed medical supplies. Examples of such upheaval and ideas for improvement are vast. The U.S. federal government actually chartered flights to bring in needed medical supplies from overseas through Project Airbridge when demand for such products was greater than the existing logistics. In fact, transportation provider Kuehne+Nagel stated that although they experienced overall business challenges in the first quarter of 2020, their requests for special charters for drug transport increased.
As for transportation impacts on individual life science companies, in a recent quarterly report, diagnostics manufacturer Bio-Rad noted that they were having “transportation challenges” due to less availability of air freight options and assorted country travel restrictions. Paratek Pharmaceuticals reported that they had experienced shipping delays, at times being unable to send products to their distributors. They even mentioned that sometimes these delays resulted in the products ultimately being returned back to the manufacturer.
When The Economic Times interviewed some employees of several pharmaceutical companies in India in April, they reported multiple examples of shipping containers becoming “piled up” due to various reasons like delays in obtaining clearances or staff shortages. Additionally, since many Indian pharmaceutical companies send their products through the cargo compartments of passenger planes, the COVID-19-related disruptions of such flights also halted the further transit of drugs and raw ingredients. One interviewee explained the repercussions of this scenario:
“The shipments of pharma products and vaccines are lined up but cannot be shipped because the air cargo complex is working at suboptimal capacity and there is no space in the cold storage facilities to store shipments before clearance…”
Transportation challenges have been such a critical issue during the pandemic that the FDA published guidance in April 2020 specifically focusing on waiving some distribution rules for pharmaceuticals. This directive actually eased some requirements for distributors so that they would be able to transport emergency drugs without having to abide by some of the pre-existing logistics-related legal restrictions. Examples of some of the waived criteria include some mandated identification and tracing of drugs and assorted licensure mandates as well as reporting requirements of distributors during transit points. The overall effect of this guidance is that more transporters are now quickly able to ship emergency drugs to their destinations.
The FDA’s new directive is in line with what Premier Inc., a purchasing advisory firm, had suggested – that pharmacies and hospitals should be able to transact medicines or supplies more easily with each other without needing some of the pre-existing licensing requirements. Additionally, they had mentioned that it may be beneficial for government entities to use air transport to accelerate needed deliveries. Another logistics provider, DHL, found that air freight had not been exceedingly disrupted throughout the pandemic due to the availability of chartered cargo flights. With this option, however, capacity limitations and high costs are concerns to life sciences companies.
Suppliers of transportation services such as DHL are partnering with life sciences companies in order to manage their shipments and provide visualization tools as well as insight into geopolitical indicators. Europa Air & Sea, a logistics company, actually created a dedicated team to handle medical equipment transport, such as personal protective equipment. This new group now manages the continuous flow of the health supplies to the UK’s National Health Service. Additionally, American Airlines increased its frequency of cargo-only flights so that increased worldwide delivery could take place for products such as medications, protective equipment and pharmaceutical chemicals.
Logistics firm Marken also provided examples of when they coordinated with life sciences clients so that needed medical supplies could be transported via chartered flights. They actually send out a “Daily Critical Supply Chain” email update to their clients, alerting them of the latest logistics challenges. Lately, they have been asked to increase the direct-to-patient delivery of medications, especially for clinical trial services. Delivery drivers can even drop off packages in a touchless manner, to avoid any germs being spread.
Some innovative ideas are even being tried for the different transportation touchpoints throughout the distribution process. UPS has actually started using drones to deliver medications from CVS directly to customer residential areas. The UK has also started such a program, delivering pathology supplies to hospitals via drone. Ride-hailing company Uber partnered with The Bill and Melinda Gates Foundation in order to deliver medications to 25,000 people in South Africa within a two-week period.
The Healthcare Distribution Alliance (HDA) has been at the forefront of the life sciences transportation issue, providing guidance to the industry through communication and collaboration. Their informational page on their website explains some of the actions they have been undertaking during the pandemic, including coordinating with healthcare and regulatory entities regarding their supply needs, gauging spikes in demand, maintaining real-time communication with manufacturers and managing existing inventories. Perhaps the HDA president Chester Davis put it best when he wrote a recent HDA blog post explaining what the life sciences logistics industry is experiencing now. He stated:
“As military history teaches us, logistics are essential to winning a war, and our fight against COVID-19 is no different.”
A number of analysts have provided their insights on how industry stakeholders may improve life sciences logistics in this pandemic environment. Within a transportation context, DHL suggests the following strategies regarding mitigating processes; constantly monitoring for any disruptions in the supply chain, searching for alternative shipping options and acknowledging the fluidity of the situation because rapid decision-making may be necessary.
Assorted other strategies recommended by other experts include companies having a dedicated transportation management system (TMS system) and advanced analytics to assist in pinpointing any transit disruptions. Within the context of clinical trials, logistics firm Almac suggests a “managed and agile approach” is key to overcoming medication supply logistics problems. Assorted ideas from this advisor include just-in-time packaging, enabling delivery straight to the patient and maintaining a business continuity plan to account for any logistics disruptions.
Key steps to dealing with transportation challenges:
As global life science transporters are busy managing the critical infrastructure of the world’s medical supply chain during the current disruptive environment of COVID-19, various mitigating tactics are being tried. A vast array of actions and ideas are being instituted — from regulatory agencies working in concert with distributors to ease any logistics impediments to drones potentially custom delivering a package of medication to a person’s front door. Increased collaboration, visibility and innovation within the life sciences logistics sphere may help to turn the tide of disruption so that patients may efficiently receive the products they need.