Pharmaceutical companies faced many challenges when it came to producing and distributing the new COVID-19 vaccines. One that received the most attention? The need to keep the new mRNA vaccines super cold during shipment and distribution.
Yossi Sheffi, Ph.D., is Elisha Gray II Professor of Engineering Systems at the Massachusetts Institute of Technology and Director of MIT's Center for Transportation and Logistics.
The race to deliver a COVID-19 vaccine has been likened to a moonshot, but in several ways landing a man on the moon was easier. In MIT Professor Yossi Sheffi’s new book, Shot in the Arm, he explores how science, engineering, and supply chain converged to vaccinate the world.
In Chapter 2, Sheffi recounts the many challenges that pharmaceutical companies faced as they sought to mass produce and distribute the approved vaccines to the entire world. These included: overcoming supply shortages for key ingredients and equipment; ramping up fast for production of hundreds of millions and then billions of doses; developing and implementing brand new manufacturing processes; and transporting supplies and finished product through a constrained global supply chain.
In this excerpt, Sheffi discusses the cold-chain innovations that companies created to respond to the challenge of transporting and storing the new mRNA vaccines at subzero temperatures. As Meri Stevens, a global supply chain leader in Johnson & Johnson’s consumer health business, told Sheffi in an interview about J&J’s vaccine, “Initially it was very much about the science and discovery, but very quickly we were having to create whole cold chains that didn’t exist before.”
A cold, hard challenge
“Ensuring over a billion people globally have access to our potential vaccine is as critical as developing the vaccine itself,” said Pfizer’s CEO [Albert] Bourla.1 Adding to the challenge of both the volume of shipments and the urgency of delivery was the need to properly handle the vials of vaccine while sending them to the far corners of the earth.
Whereas most vaccines require some refrigeration, the new mRNA vaccines require the most careful handling because of the delicate constitution of their lipid nanoparticles. Molecular biologist Phillip Sharp of MIT explained, “This is an oily particle with carbohydrate around it. So, it’s a pain to keep it from fusing. It’s just one big ball of oil if it’s not taken care of. That’s why all this shipping and freezing and thawing and everything is really very important.”2 Moderna’s vaccine requires freezing between –50°C and –15°C (–58°F and 5°F), and Pfizer’s requires ultra-low-temperature freezing between –80°C and –60°C (–112°F and –76°F). As a result, these vaccines require cold-chain handling: global distribution activities at very low and controlled temperatures.
The colder the temperature, the more challenging the cold-chain transportation and storage issues. In the case of the Pfizer vaccine’s deep-freeze needs, very few facilities—only a handful of pharmaceutical distribution centers, hospitals, and research laboratories—had the kinds of deep freezers needed. “I don’t think we have all the cold storage that people think we have,” commented James Bruno, president of the consulting firm Chemical and Pharmaceutical Solutions.3
Helping Shipments Keep Their Cool
As part of its development strategy, Pfizer began setting up its downstream supply chain for the finished product in March 2020—at the same time as the kick-off of its COVID vaccine development. Pfizer said it developed a “just-in-time system, which will ship the frozen vials direct to the point of vaccination.”4 That system included packaging for shipping, continuous monitoring of vaccine temperatures to ensure safety, and a means to store the vaccine for up to a month at clinics, vaccination centers, and distribution facilities that lacked deep freezers. These efforts used supply chain partners with respective expertise in cold-chain packaging and supply chain monitoring.
Pfizer worked with SoftBox, a multinational British manufacturer of temperature-controlled packaging, to develop a reusable insulated thermal shipping box5 that holds 1,200 to 6,000 doses. The box, measuring 17 x 17 x 22 inches, holds up to five small “pizza box” trays, each with 195 vials, in an inner payload sleeve box nestled deep in the heavily insulated outer box.6 On top of the precious cargo sits a “pod” with up to 50 pounds of dry ice at –109°F (-79°C). An insulated lid completes the cozy ensemble.
The result is a medium-sized, robust, 70- to 80-pound box (with side straps) that can be handled by any air or ground parcel delivery service. (Pfizer and SoftBox even designed the box to reduce the sublimation of the dry ice during flight, reducing the generation of potentially hazardous caron monoxide (CO) levels in air freighters and significantly increasing the number of doses that air-freighters were permitted to safely carry.)7
As an added bonus, this thermal container can maintain ultra-cold temperatures for up to 10 days. Moreover, if needed, the recipient can replenish the dry ice every five days to extend storage in the box for up to 30 days.8 That enables facilities that lack the required freezers to temporarily store, distribute, and dispense the vaccine. Finally, when needed, the vaccine is thawed and can be kept in an ordinary refrigerator for up to five days before dilution and injection.
A view to a chill
To maintain 24/7 visibility of shipments, Pfizer contracted with Controlant, a provider of real-time supply chain monitoring devices that go into shipping boxes.9 A small, battery-powered sensor tracks vaccine temperature, the opening of the box, and its GPS location. Using a standard cellular data connection, the sensor sends the information in real time to Controlant’s cloud-based software, where customers can receive alerts and view the information. When the box is opened, red-green status lights show the shipment’s temperature status, data connection status, and battery status. “Controlant’s reusable, real-time data loggers and visibility and analysis platform integrates with Pfizer’s existing control tower technologies,” said Tanya Alcorn, vice president of biopharma global supply chain at Pfizer, “to help manage temperature proactively, identify and react expeditiously to any events that can impact the supply chain, all while automating quality and logistics processes.”10
One tricky issue with the monitoring system occurred at the handoff when Pfizer delivered the doses to government distribution or vaccination centers. As the shipment left Pfizer’s hands, Pfizer turned the monitoring off for legal liability and practicality reasons; once delivered, Pfizer had no control over the status of the shipment or the means to make the recipient take a corrective action. But recipients wanted the ability to monitor the boxes too, especially if they planned to use them for interim storage by refilling the dry ice. Fortunately, because the monitoring device was actually made and monitored by a third party, Controlant, all any recipient had to do was to sign up with the tracking company to restart monitoring and route the data and alerts to the recipient.11
Getting ready to move ’em out
Pfizer bought large numbers of deep freezers to set up freezer farms to buffer and distribute the output of its production facilities in Michigan and Belgium. The company also built its own dry ice plant to make the freezing pods that keep the vaccines cold during transit. As of November 2020, Pfizer planned to have a fleet of 24 trucks to ferry shipments from Pfizer’s facilities to local airports, where a combination of air charter and air freight companies such as FedEx, UPS, and DHL could carry the vaccine anywhere in the world within a day or two. As the clinical results of the Phase 3 trials confirmed the efficacy of the Pfizer–BioNTech vaccine, Pfizer announced plans to move roughly 7.6 million doses per day.12
Similarly, airfreight companies and facilities prepared for the vaccine distribution campaign. UPS, for example, built its own freezer farms and dry-ice production equipment at key air hubs.13 Airports invested in additional security and cold storage.14 Airlines conducted trial runs of vaccine deliveries to both debug systems and ensure the CO emissions from the dry ice remained within Federal Aviation Administration (FAA)-required limits.15 In coordination with Operation Warp Speed, FedEx and UPS divided the U.S. in half to improve delivery efficiencies.16 The efforts were intended to ensure fast, efficient, and problem-free delivery of the vaccines once they were approved and started shipping.
The bigger picture of bigger demand
Overall, vaccine suppliers had to face and overcome a long list of challenges: Shortages began in the product development labs, moved into the ingredient supply chains, and then hit the packaging ends of vaccine development and production processes. Shortages also hit capital equipment supply chains as pharmaceutical makers attempted to ramp up their capacity. As the adage goes, supply chains are only as strong as their weakest links. Successfully delivering large quantities of a new product depends on delivering all of the required quantities of every one of the raw materials, ingredients, and all other parts in the bill of materials (BOM) of the final product, as well as all the plant equipment and machinery needed for manufacturing and delivering the product. Supply chains aren’t about doing one thing well; they are about doing every one of many things well, because final products and customer satisfaction depend on every one of those many things for a complete, high-quality product delivered on time.
Even the packaged final product—billions of doses of safe and effective vaccines—wasn’t the end of the challenge. Those vaccines still needed to get to the customers: all people in all the countries of the world. Although modern supply chains have become adept at quickly and accurately making and moving millions of shipments of consumer products per day anywhere in the world, actually getting those doses into people’s arms was a real challenge that tested national and local institutions.
11. Goldhill, Olivia. “Pfizer Decision to Turn Off Temperature Sensors Forced Scramble to Ensure COVID-19 Vaccines Kept Ultra-Cold.” Stat, December 17, 2020.
The practice consists of 5,000 professionals from Accenture and from Avanade—the consulting firm’s joint venture with Microsoft. They will be supported by Microsoft product specialists who will work closely with the Accenture Center for Advanced AI. Together, that group will collaborate on AI and Copilot agent templates, extensions, plugins, and connectors to help organizations leverage their data and gen AI to reduce costs, improve efficiencies and drive growth, they said on Thursday.
Accenture and Avanade say they have already developed some AI tools for these applications. For example, a supplier discovery and risk agent can deliver real-time market insights, agile supply chain responses, and better vendor selection, which could result in up to 15% cost savings. And a procure-to-pay agent could improve efficiency by up to 40% and enhance vendor relations and satisfaction by addressing urgent payment requirements and avoiding disruptions of key services
Likewise, they have also built solutions for clients using Microsoft 365 Copilot technology. For example, they have created Copilots for a variety of industries and functions including finance, manufacturing, supply chain, retail, and consumer goods and healthcare.
Another part of the new practice will be educating clients how to use the technology, using an “Azure Generative AI Engineer Nanodegree program” to teach users how to design, build, and operationalize AI-driven applications on Azure, Microsoft’s cloud computing platform. The online classes will teach learners how to use AI models to solve real-world problems through automation, data insights, and generative AI solutions, the firms said.
“We are pleased to deepen our collaboration with Accenture to help our mutual customers develop AI-first business processes responsibly and securely, while helping them drive market differentiation,” Judson Althoff, executive vice president and chief commercial officer at Microsoft, said in a release. “By bringing together Copilots and human ambition, paired with the autonomous capabilities of an agent, we can accelerate AI transformation for organizations across industries and help them realize successful business outcomes through pragmatic innovation.”
Census data showed that overall retail sales in October were up 0.4% seasonally adjusted month over month and up 2.8% unadjusted year over year. That compared with increases of 0.8% month over month and 2% year over year in September.
October’s core retail sales as defined by NRF — based on the Census data but excluding automobile dealers, gasoline stations and restaurants — were unchanged seasonally adjusted month over month but up 5.4% unadjusted year over year.
Core sales were up 3.5% year over year for the first 10 months of the year, in line with NRF’s forecast for 2024 retail sales to grow between 2.5% and 3.5% over 2023. NRF is forecasting that 2024 holiday sales during November and December will also increase between 2.5% and 3.5% over the same time last year.
“October’s pickup in retail sales shows a healthy pace of spending as many consumers got an early start on holiday shopping,” NRF Chief Economist Jack Kleinhenz said in a release. “October sales were a good early step forward into the holiday shopping season, which is now fully underway. Falling energy prices have likely provided extra dollars for household spending on retail merchandise.”
Despite that positive trend, market watchers cautioned that retailers still need to offer competitive value propositions and customer experience in order to succeed in the holiday season. “The American consumer has been more resilient than anyone could have expected. But that isn’t a free pass for retailers to under invest in their stores,” Nikki Baird, VP of strategy & product at Aptos, a solutions provider of unified retail technology based out of Alpharetta, Georgia, said in a statement. “They need to make investments in labor, customer experience tech, and digital transformation. It has been too easy to kick the can down the road until you suddenly realize there’s no road left.”
A similar message came from Chip West, a retail and consumer behavior expert at the marketing, packaging, print and supply chain solutions provider RRD. “October’s increase proved to be slightly better than projections and was likely boosted by lower fuel prices. As inflation slowed for a number of months, prices in several categories have stabilized, with some even showing declines, offering further relief to consumers,” West said. “The data also looks to be a positive sign as we kick off the holiday shopping season. Promotions and discounts will play a prominent role in holiday shopping behavior as they are key influencers in consumer’s purchasing decisions.”
That result came from the company’s “GEP Global Supply Chain Volatility Index,” an indicator tracking demand conditions, shortages, transportation costs, inventories, and backlogs based on a monthly survey of 27,000 businesses. The October index number was -0.39, which was up only slightly from its level of -0.43 in September.
Researchers found a steep rise in slack across North American supply chains due to declining factory activity in the U.S. In fact, purchasing managers at U.S. manufacturers made their strongest cutbacks to buying volumes in nearly a year and a half, indicating that factories in the world's largest economy are preparing for lower production volumes, GEP said.
Elsewhere, suppliers feeding Asia also reported spare capacity in October, albeit to a lesser degree than seen in Western markets. Europe's industrial plight remained a key feature of the data in October, as vendor capacity was significantly underutilized, reflecting a continuation of subdued demand in key manufacturing hubs across the continent.
"We're in a buyers' market. October is the fourth straight month that suppliers worldwide reported spare capacity, with notable contractions in factory demand across North America and Europe, underscoring the challenging outlook for Western manufacturers," Todd Bremer, vice president, GEP, said in a release. "President-elect Trump inherits U.S. manufacturers with plenty of spare capacity while in contrast, China's modest rebound and strong expansion in India demonstrate greater resilience in Asia."
Even as the e-commerce sector overall continues expanding toward a forecasted 41% of all retail sales by 2027, many small to medium e-commerce companies are struggling to find the investment funding they need to increase sales, according to a sector survey from online capital platform Stenn.
Global geopolitical instability and increasing inflation are causing e-commerce firms to face a liquidity crisis, which means companies may not be able to access the funds they need to grow, Stenn’s survey of 500 senior e-commerce leaders found. The research was conducted by Opinion Matters between August 29 and September 5.
Survey findings include:
61.8% of leaders who sought growth capital did so to invest in advanced technologies, such as AI and machine learning, to improve their businesses.
When asked which resources they wished they had more access to, 63.8% of respondents pointed to growth capital.
Women indicated a stronger need for business operations training (51.2%) and financial planning resources (48.8%) compared to men (30.8% and 15.4%).
40% of business owners are seeking external financial advice and mentorship at least once a week to help with business decisions.
Almost half (49.6%) of respondents are proactively forecasting their business activity 6-18 months ahead.
“As e-commerce continues to grow rapidly, driven by increasing online consumer demand and technological innovation, it’s important to remember that capital constraints and access to growth financing remain persistent hurdles for many e-commerce business leaders especially at small and medium-sized businesses,” Noel Hillman, Chief Commercial Officer at Stenn, said in a release. “In this competitive landscape, ensuring liquidity and optimizing supply chain processes are critical to sustaining growth and scaling operations.”
With six keynote and more than 100 educational sessions, CSCMP EDGE 2024 offered a wealth of content. Here are highlights from just some of the presentations.
A great American story
Author and entrepreneur Fawn Weaver closed out the first day of the conference by telling the little-known story of Nathan “Nearest” Green, who was born into slavery, freed after the Civil War, and went on to become the first master distiller for the Jack Daniel’s Whiskey brand. Through extensive research and interviews with descendants of the Daniel and Green families, Weaver discovered what she describes as a positive American story.
She told the story in her best-selling book, Love & Whiskey: The Remarkable True Story of Jack Daniel, His Master Distiller Nearest Green, and the Improbable Rise of Uncle Nearest. That story also inspired her to create Uncle Nearest Premium Whiskey.
Weaver discussed the barriers she encountered in bringing the brand to life, her vision for where it’s headed, and her take on the supply chain—which she views as both a necessary cost of doing business and an opportunity.
“[It’s] an opportunity if you can move quickly,” she said, pointing to a recent project in which the company was able to fast-track a new Uncle Nearest product thanks to close collaboration with its supply chain partners.
A two-pronged business transformation
We may be living in a world full of technology, but strategy and focus remain the top priorities when it comes to managing a business and its supply chains. So says Roberto Isaias, executive vice president and chief supply chain officer for toy manufacturing and entertainment company Mattel.
Isaias emphasized the point during his keynote on day two of EDGE 2024. He described how Mattel transformed itself amid surging demand for Barbie-branded items following the success of the Barbie movie.
That transformation, according to Isaias, came on two fronts: commercially and logistically. Today, Mattel is steadily moving beyond the toy aisle with two films and 13 TV series in production as well as 14 films and 35 shows in development. And as for those supply chain gains? The company has saved millions, increased productivity, and improved profit margins—even amid cost increases and inflation.
A framework for chasing excellence
Most of the time when CEOs present at an industry conference, they like to talk about their companies’ success stories. Not J.B. Hunt’s Shelley Simpson. Speaking at EDGE, the trucking company’s president and CEO led with a story about a time that the company lost a major customer.
According to Simpson, the company had a customer of their dedicated contract business in 2001 that was consistently making late shipments with no lead time. “We were working like crazy to try to satisfy them, and lost their business,” Simpson said.
When the team at J.B. Hunt later met with the customer’s chief supply chain officer and related all they had been doing, the customer responded, “You never shared everything you were doing for us.”
Out of that experience, came J.B. Hunt’s Customer Value Delivery framework. The framework consists of five steps: 1) understand customer needs, 2) deliver expectations, 3) measure results, 4) communicate performance, and 5) anticipate new value.
Next year’s CSCMP EDGE conference on October 5–8 in National Harbor, Md., promises to have a similarly deep lineup of keynote presentations. Register early at www.cscmpedge.org.