A Blizzard in the Forecast? The Changing Face of Regulations, Air Cargo Transport, and Logistics Driving Global Healthcare Distribution

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A Blizzard in the Forecast?The Changing Face
of Regulations, Air Cargo Transport, and
Logistics Driving Global Healthcare Distribution
Tony Wright, CEO, Exelsius Cold Chain
Management and member IATA Time Temperature
Task Force and PCCIG

• Kevin ODonnell,
• Director and Chief Technical Advisor,
• ThermoSafe Brands and Chair
• IATA Time Temperature Task Force
• HPCLC
• Long Boat Key, FL 14 October 2010

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Regulatory Drivers

• Increased scrutiny on the entire distribution
  supply chain
• Increased expectation in shipment monitoring
• Greater regulatory enforcement

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Major Regulatory Changes, Standards Guidance to
be enacted in 2011

• United States Pharmacopoeia
• General Chapter lt1079gt Good Storage and Shipping
  Practices
• World Health Organization
• Harmonized guidance for the storage and transport
  of time and temperaturesensitive pharmaceutical
  products
• Health Canadas
• GUIDE-0069 Guidelines for Temperature Control of
  Drug Products during Storage and Transportation

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But Wait Theres More!

• Parenteral Drug Association
• Technical Report No. 39 Guidance for
  Temperature-Controlled Medicinal Products
  Maintaining the Quality of Temperature-Sensitive
  Medicinal Products through the Transportation
  Environment
• Technical Report No. 46 Last Mile Guidance for
  Good Distribution Practices for Pharmaceutical
  Products to the End User

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and more

• PDA Technical Report No ? Recommended Best
  Practices for Manufacturers of Temperature
  Sensitive Products to Comply with TSA Cargo
  Screening Requirements
• HDMA Managing Cold Chain Temperature Sensitive
  Products
• IATA Chapter 17 Air Transport Logistics for Time
  and Temperature-Sensitive Healthcare Products
• And more on the way!

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Why All the Attention?

• Substantial increase in temperature-controlled
  drug products due to
• Patent expiration on biological drugs
• Surge in biologics
• New product development
• New global markets
• Evolving manufacturing practices

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Global Manufacturing Processes
Courtesy Exelsius/Zymogenetics
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Market Statistics

• Market worth approximately US680bn.
• Temperature-controlled market 168bn.
• Healthcare market forecast to grow to US900bn by
  2012.
• Nearly 100 of all vaccines and 65 of biotech
  products need temperature controlled storage and
  transportation.
• Biotech market fastest growth majority by air
  cargo.

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Air Cargos Changing Airscape

• Downsized Fleets
• Reconfigured Aircraft Utilization
• Airline Consolidation
• Abandon Lanes
• Trade Imbalances

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The 2010 Turnaround
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Air Freight Capacity is not Keeping up with
Global Growth.
Source Boeing Report, June 2010
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New Aircraft Orders are Up
Source Boeing Report, June 2010
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Aircraft Demand by size 2009-2029
Size New Airplanes Value (B)
Regional Jets 1,920 60
Single Aisle 21,160 1,680
Twin Aisle 7,100 1,630
Large 720 220
Source Boeing Report, June 2010
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Emerging economies and changing demographics will
shift passenger traffic and consequently, cargo
flows
And at a time when outsourced production means
greater logistical challenges to cold chain
distribution
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The Overall Air Cargo Sector

• Approximately 12 of
• total airline revenues
• are from air cargo.
• By volume of cargo
• carried, only 5 is
• perishable.
• Healthcare products
• represent less than
• 0.5 of total air cargo.

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Cold Chain Products Growing Faster
Global Biopharma Sales 2008-2011
Source Pharmaceutical Commerce
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How is the global air cargo sector reacting?

• Increased focus on the
• healthcare sector.
• Increased collaboration.
• New air cargo handling
• regulations.
• Improved technology.

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Increased Sector Focus
Global Airlines offering Pharmaceutical
cold-chain products
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Collaboration

• Mutual
• Physical
• Beneficial

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Collaboration in the air cargo logistics process
whos involved?
Collaboration Getting the entire cold chain
working together to improve the way it
operates
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Key Areas of Cold Chain Risk
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57
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Courtesy Exelsius
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Collaboration in Practice

• IATA Time Temperature Task Force
• Manufacturers, forwarders, airlines,
• regulators, ground handling cos,
• technology providers, etc
• Brought together into a commonly
• understood purpose patient
• safety.
• Required immense time effort

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Collaboration resulted in a new set of
Regulations...

• IATA Perishable Cargo
• Regulations, Chapter 17
• Binding to all IATA members
• Specific to the handling of time
• and temperature-sensitive
• products.

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... and a vital new label
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Gaining Industry Support
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Transportation Technology Advances

• Provides both
• heating and cooling.
• Reliable,
• compressor-driven
• technology.
• On-board
• temperature monitor

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Summary

• Regulation, regulation, regulation
• Challenges of global manufacturing
• Air Cargos changing airscape
• Capacity vs. growth
• Cold chain growing fast(er)
• The air cargo sector is reacting
• Collaboration new technology

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Who depends on us working together?
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Thank You!

• Tony Wright
• tony.wright_at_exelsius.co.uk
• Kevin ODonnell
• kevin.odonnell_at_tegrant.com