Here comes vaccine development. Now comes vaccine distribution on a global scale.
Distributing billions of doses of vaccines across the world face complex supply chain challenges. With freezing temperature and traceability requirements during delivery plus the risk throughout the supply chain, logistics players are rethinking and expanding their capabilities like never before.
ExploreSCM recently spoke to Leonora Lim, Vice President of Life Science and Healthcare at DHL Customer Solutions and Innovation – Asia Pacific, to figure out what logistical challenges facing the vaccine distribution, DHL’s role in transporting vaccines, and how the company is gearing up for this extraordinary task.
Q. The global distribution of Covid-19 vaccine is expected to start by early next year, what are some of the key challenges the logistics industry are facing? How do logistics players plan to solve those constraints?
A. The challenge for us as an industry is to scale up for the 10 billion vaccine doses that we envisage in our white paper will need to be delivered, including to regions with less developed logistics infrastructure, where approximately 3 billion people live. Other than the tight airfreight capacity situation we face currently, there would need to be sufficient storage and distribution capabilities on the ground and a robust delivery network to cope with the staggering volume of shipments.
Other challenges include the numerous uncertainties such as the temperature ranges (including ultra-low temperatures) that the vaccines will need to be in, shipment volumes and shipping points.
Q. How does technology play its role to create visibility of vaccines throughout the supply chain? How important is the data?
A. Across the Group, we are committed to digitalizing processes as part of our Strategy 2025 to enhance customer and employee experience as well as improve operational excellence.
At DHL, we have systems and tools in place that leverage technology for tracking and visibility purposes. We also deploy data analytics in running lane risk assessments that can optimize the transportation of these sensitive shipments. Our innovation centers continue to be on a lookout for relevant technologies, such as data analytics, sensors and Internet of Things, to support the monitoring of the sensitive shipments.
In general, the analytics and application of data in logistics has helped to increase efficiency and reliability, and create a more sustainable value chain by optimizing routes, speeding up processing capabilities and empowering smarter forecasting to reduce costs and mitigate risks. This will be the same when applied to vaccine logistics – the more data that we collect from earlier shipments of vaccine logistics, the better we are equipped to improve processes for subsequent shipments.
Q. Airlines have reduced their number of flights significantly due to travel restrictions, how does that affect vaccines logistics?
A. To provide global coverage, up to 200,000 movements by pallet shippers and 15 million deliveries in cooling boxes as well as 15,000 flights will be required across the various different supply chain setups.
Given the urgency of getting vaccines to their destinations, air freight is the most viable mode for transporting the precious cargo across long distances. There will certainly be some challenges given the current capacity shortage in the air freight market. However, there are alternatives that vaccine providers could look into.
With adequate packaging solutions, there could be viable multimodal or road options should air freight capacity be lacking or for shorter cross-border shipments and we do have the advantage of being able to tap on all Deutsche Post DHL Group’s business divisions (DHL Express, DHL Global Forwarding, DHL Supply Chain and DHL eCommerce Solutions) to get the vaccines out to as many people as possible.
At the height of the pandemic, even when flights were grounded and cities were in lockdown, we mobilized our own network of aircraft, secured every available charter we could find and provided alternative multimodal solutions (for example, by using a combination of road, rail or ocean) to get life-saving shipments across borders. We are fortunate to have our own fleet of over 265 aircraft that we could leverage and maximize to ensure we meet the air freight needs of our customers.
Q. What actions the logistics industry are taking now in preparation for a massive vaccine worldwide distribution?
A. At DHL, while we already have the capabilities in terms of infrastructure and experience in handling vaccine distribution and shipping temperature-sensitive products, we have established an internal global cross-divisional task force to oversee the readiness and upscaling of our current capabilities such as our life sciences & healthcare facilities, temperature control solutions, etc.
Externally, we are in talks with vaccine developers and manufacturers and public institutions on their supply chain needs and are committed to ensuring that the vaccines reach as many people as possible.
Q. How does DHL play its role in ensuring vaccines get distributed as quickly as possible to the world’s population while keeping the drug in a frozen environment?
A. DHL has been building its Life Science & Healthcare expertise and capabilities over the past 20 years and have enjoyed long standing and collaborative partnerships with various stakeholders, including governments and our customers. As mentioned, we have established an internal task force earlier this year to look at where we would need to further beef up our capabilities when the actual vaccines are approved for distribution, and are working closely with our customers and suppliers to ensure we can cope with the roll out.
We have also built a solid foundation with a 9000-strong community of LSH specialists, 118 competence centers in airports and ports globally for the specialized handling of LSH products, 160+ Good Distribution Practice (GDP)-qualified warehouses, 15+ Good Manufacturing Practice (GMP)-certified sites and 135+ medical express sites.
We continue to further our efforts to build our capabilities with new and expanded ground facilities, equipment, delivery routes and specialists. For example in Australia, DHL Supply Chain recently launched four state-of-the-art healthcare-grade warehouses to cater to mounting demand for such products.
DHL Global Forwarding and the DHL Medical Express team have transported vaccines at deep frozen states in the past and have the means to do so as needed. Whilst we believe that mass distribution of vaccines will take place only after frontline workers are inoculated, we have been working on various freight and distribution solutions across the world to be ready when the time comes.