PO Q1 2021 - 33
SECTION
TITLE
COLD CHAIN
Return to Refrigerated Temperatures for
COVID-19 Vaccines
Airbus previously announced it would stop deliveries of its A380
As of February 10, 2021, 94 different COVID-19 vaccines are in clinical
in leaner aircraft, like the Airbus A220 designed by Bombardier
trials, under regulatory review for approval or approved for use. Four
Aerospace. This move to smaller jets will further impact dwindling
vaccines are approved for full use, and we expect the number of viable,
global air freight capacity throughout 2021.
aircraft in 2021, and we already see airlines retiring these jets in favor
of more modern, smaller aircraft. We expect to see more interest
approved COVID-19 vaccines will continue to grow throughout 2021.
All else equal, it is likely the market will favor vaccines that
Continued Build Up in Sea Freight
require refrigerated temperatures of 2-8 degrees Celsius. Existing
While many pharmaceutical products move by air, sea freight remains
infrastructure exists to transport and store these vaccines around the
an important shipping method. Put into perspective, six million
world more easily. Additionally, refrigerated temperatures eliminate
containers routinely turn and carry freight - an estimated 17 million
concerns around shortages of dry ice and concerns about how it
twenty-foot equivalent units (TEUs).
reduces the amount of available cargo space on aircraft.
Delays in shipping result in a buildup of sea containers, which leads
This preference for refrigerated vaccines could push pharmaceutical
to availability issues and rate increases. At the onset of COVID-19,
companies with deep frozen vaccines to determine how to maintain
efficacy of the vaccine at a refrigerated temperature. If this happens,
we will gain knowledge that moves pharmaceuticals' current storage
and distribution temperature from minus 80 degrees Celsius to
easier-to-distribute ranges of minus 50 or minus 20 degrees Celsius,
or even refrigerated temperatures.
China stopped producing goods for global export and moving sea
containers out of its ports. When China returned to 98 percent of
its output in April 2020, other countries around the world went on
lockdown. As sea containers piled up in ports and shipping lines
were cut from sailing schedules, sea freight prices spiked by up to
50 percent. Regardless, uncertainty in sea and air freight availability
prompted pharmaceutical companies to ship everything they could
Increase in Preighters and Move to
Smaller Aircraft to Transport
Pharmaceutical Payloads
by any mode of transport available.
It is impossible to talk about COVID-19 and now vaccine distribution
spread beyond the United Kingdom could further exacerbate the
We again saw a buildup of sea containers following the 2020 holiday
retail demands. China's availability issues and reduced sailings will
continue to cause this until at least March 2021. Lockdowns that
without a look at the air cargo industry. Over the past 20 years,
airline passenger traffic grew. The available cargo space on
buildup and push availability issues through the first half of 2021.
This will cause pharmaceutical companies to use air freight and pay a
passenger planes plus dedicated cargo aircraft offered ample
premium for scarce space.
space to transport pharmaceutical payloads across the world. That
all changed in 2020. As the pandemic took off, passenger flights
Shifting Modes of Transportation
plummeted creating scarcity in air cargo space and less room to use
Like flu vaccines, it appears COVID-19 vaccines will require boosters.
aircraft to transport pharmaceuticals.
This creates a recurring step up in the volume of vaccines shipped
Pioneering Portuguese charter Hi Fly led the trend to convert
passenger planes to freighters, or preighters, by removing passenger
seats and using the space for cargo. Other airlines quickly followed
suit, further increasing capacity, yet not enough to meet demand.
alongside seasonal flu vaccines and other pharmaceutical payloads
every year. Since temperature specifications for these vaccines only
allow for air transportation, we will see COVID-19 pharmaceutical
payloads, including therapeutics, take up dwindling air cargo space
throughout this year. Companies will continue to pay a premium
Boeing projects the global freighter fleet will grow 60 percent over
of up to $23 a kilo for this space, with potential cost reduction as
the next two decades, resulting in 3,260 operational aircraft by 2039.1
the year progresses. This means pharmaceutical payloads with
But this fleet growth takes time and will not immediately replace
temperature requirements of 2-8 degrees Celsius or 15-25 degrees
lost capacity in passenger aircraft. Preighters will continue to fill
Celsius must ship by sea. This remains challenging until capacity
an important role in 2021 and beyond, and we suspect airlines will
opens up mid-2021.
convert newer 747 aircraft to fill an immediate need for capacity.
Overall, the pharmaceutical, cold chain and air cargo industries will
Similarly, experts predicted pre-pandemic that airlines would ground
spend 2021 learning how to operate in a new normal. It will take
and retire large, widebody aircraft and move toward smaller and more
flexible planning, as well as adjusting capacities and operations around
efficient aircraft. With fewer passengers flying now, we see airlines
the spike in demand and gradually improving capacity picture. If all
accelerating their timelines to park these planes - some permanently.
goes well, next year might bring improvements and efficiencies.
pharmoutsourcing.com |
33
| January/February/March 2021
http://www.pharmoutsourcing.com
PO Q1 2021
Table of Contents for the Digital Edition of PO Q1 2021
PO Q1 2021 - Cover1
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PO Q1 2021 - 1
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