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Lower costs, fewer opportunities for temperature excursions, and a smaller carbon footprint are making ocean transport more attractive for pharmaceuticals. Poseidon, a new collaborative pharma initiative, seeks to leverage benefits.
Transporting sensitive pharmaceuticals is a risky and complex business. “The lower deck conditions within a Boeing plane or a typical intermodal freight container are a long way from the GMP-validated cleanrooms and controlled laminar-flow environments of the pharma production environment,” says Alan Kennedy, founder and executive director of TEAM UP, an organization that focuses on pharma supply chain issues.
According to the International Air Transport Association (IATA), the global pharmaceuticals logistics market is valued at $64 billion and is one of the most regulated, expensive, and fragile cargo markets in the world today (1), says Kennedy.
Pharmaceutical transport typically combines different modes, explains Kennedy. Air transport, prized for its speed and flexibility, is used mainly for long distance, intercontinental distribution of the most valuable therapeutics, he says, while road is the most widespread method and is also used to connect with both air and sea freight.
Rail remains an insignificant factor, but this may change, Kennedy says, as new “silk route” connections between Asia and Europe are established (2).
Ocean transport may conjure 1940’s images of the days when most people still crossed the ocean by ship. It has historically been the Cinderella of pharma distribution, says Kennedy, but, IATA notes that 3.5 million metric tons of pharmaceuticals are still shipped by ocean each year, compared with 0.5 million metric tons by air (3).
Over the past five years, ocean transport has taken on much greater visibility in the pharma industry. Cost competitiveness is one factor driving acceptance, he says, since it is up to 80% less expensive than air transport. In addition, Kennedy notes, although it takes much longer than air travel it is often more reliable, because there are far fewer product handoffs. According to some studies, air freight accounts for 80% of all reported temperature excursions, compared with 1% for sea journeys (4,5).
With ocean freight, customs clearances and other time-consuming paperwork procedures can often be arranged during transit. “The fact that ocean freight entails a greater stock tie-up can also be mitigated through use of ‘floating warehouse’ principles whereby goods in transit are recognized as inventory,” he says.
In addition, ocean transport has a carbon footprint that is 1/25th the size of air travel’s (i.e., 1000 grams per m.t./km of CO2 are released during air transport, compared with less than 40 grams by ocean transport (6), says Kennedy.
A 2013 report by analysts from The Seabury Group (7) found significant quality-control problems with air freight. As a result, Kennedy says, air cargo carriers began to set higher standards, establishing the IATA Center of Excellence for Independent Validators (CEIV) Pharma program to interpret general European Union and other good distribution practices (GDPs) for air cargo (8).
That same year, the EU extended GDP regulations to cover controlled room temperature (CRT) products, which must nominally be kept from 15-25 °C, which only accelerated a switch from air to ocean transport, Kennedy says.
So far, most of the growth in pharma ocean transport has been around relatively low value, high-volume products such as solid-dose tablets, generic pharmaceuticals, APIs, and excipients. However, advocates see that it also has potential to handle more sensitive large-molecule biologics as well as personalized medicine therapies.
Among ocean transport’s strongest pharma advocates is AstraZeneca, which has increased the percentage of products it ships by sea from 5% in 2012 to nearly 70% in 2017 (9). Eli Lilly, which has been conducting studies of ocean transport of biologicals, has found that transporting products by sea saves 80% in costs, reduces carbon footprint, reduces staffing requirement, packing, and storage needs, and also reduces vibration and shock to materials during transport (10).
Lilly has partnered with Modality Solutions for protocols and reports, with Q Products for thermal covers, and with Sensitech, using TempTales, monitors that allow for simultaneous tracking of both temperature and location.
One test involved simulating worst-case scenarios for a 40-foot reefer transporting 18 pallets of placebo, evaluating temperatures ranging from 0 -115 °F. The studies used Locus Traxx GPS and Lansmont’s Saver to monitor product shock and vibration. Other tests compared results of trucking product to Long Beach, CA, a two-to-three-day trip, with shipping product to Australia, a 45-day trip one way.
A Bayer study (11), meanwhile, showed ocean transport plus trucking to be an efficient way to transport pharmaceuticals inland in Brazil. Logistics efforts in that country can be challenging, because they involve driving long distances overland and, in some areas, facing potential security issues.
In 2016, at the European Temperature Control Logistics Conference, a number of stakeholders in pharma cold-chain shipping joined forces to form TEAM UP. Their aim was to explore ways to improve the shipping of pharmaceuticals. In January 2018, TEAM UP established Poseidon, a network involving the different types of companies involved in the ocean transport of pharmaceuticals (see Sidebar).
Led by pharmaceutical manufacturers, but involving shippers, logistics companies, and suppliers as full partners, the group is focusing on applying best collaborative and integration practices. Its goal is to leverage the latest technology to address any performance gaps that might still separate ocean from other transport modes. Technology vendor members currently include Maersk, H. Essers, Marsh, DowDuPont, Pelican Biothermal, Klinge Corp., Logtag Recorders, and Controlant. Members are collaborating on new projects, including a major validation study that will be completed in June 2018, as well as new insurance and container options for sea freight.
1. “Pharmaceutical Transportation: How to Increase Air Cargo’s Share,” aircargopedia.com, 2017.
2. J. Webb, “The New Silk Road: China Launches Beijing-London Freight Train Route,” forbes.com, January 3, 2017.
3. IATA, “Putting Pharmaceuticals Back in the Air,” iata.org, 2017.
4. M. Roebuck, “Astra-Zeneca Eyes Major Shift from Air Freight to Ocean: A More-Controlled Environment for Drugs,” theloadstar.co.uk, December 15, 2015.
5. Climate Killing Airplanes, fluglaerm.de, 2015.
6. Opinion Editorial, “Unreliable Air Cargo Industry Loses Pharma Traffic to Sea While IATA Sleeps,” coolchain.org.
7. Seabury Group Pharma Market Overview, coolchain.org, May 14, 2013.
8. IATA, Centers of Excellence for Independent Validators, iata.org.
9. A. Guisbert-Wiliams, “Eli Lilly and Company NALO Logistics Paradigm Shift Air to Ocean (A2O),” 15th Cold Chain GDP and Temperature Management Logistics Summit, Canada, 2017.
10. J. Wann, “Air, Ocean, Road Strategy at AstraZeneca,” Logipharma, April 2017.
11. R. Velazquez Trevino, “Modal Shifts: Where Are We Going?” TCL London 2017, January 31, 2016.
Vol. 42, No. 3
When referring to this article, please cite it as A. Shanley, "Poseidon Takes on the Pharma Supply Chain," Pharmaceutical Technology 42 (3) 2018.