Maersk’s Global Vertical Head of Pharmaceuticals answers questions on vaccine rollout
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The maritime industry is on course to play a much larger role in the battle against coronavirus as new vaccines come on stream. Maersk, the world’s largest shipping company, will inevitably be one of those leading the charge once vaccines can be transported by sea. But how is the vaccine rollout going? And how will it develop? To find the answers to these questions and more, we spoke to Hristo Petkov, Maersk’s Global Vertical Head of Pharmaceuticals & Healthcare.
Petkov spoke to Trans.INFO ahead of his appearance at this week’s Alcott Global Cold Chain summit, which features 1-on-1 virtual networking, a panel discussion with experts, and speeches by C-level speakers from Global Manufacturers, NGOs, airlines, airports, ports, 3PLs, and more.
Hi Hristo, thanks for talking to us at Trans.INFO. First off, the vaccine distribution has already been in process in a number of countries for a few weeks now. How would you assess how things have gone so far?
I am confident that everybody involved is doing the best they can with the resources that they have at hand. However, we know that there hasn’t been as many vaccines as anticipated. That’s because there are also a lot of logistical challenges upstream in terms of being able to produce the vaccines.
We also know that there are a lot of logistical challenges in terms of distribution. One of the vaccines that came on the market, the Pfizer vaccine, requires minus 80 degrees Celsius temperature control, so to have these capabilities from origin to destination, and ensuring the final mile, I think is extremely challenging. So I think they have done a very good job so far.
But there is no doubt that the general global population expects more, faster and better done, right? And now we’re also looking into Moderna, who have started distributing their vaccines. And there are a couple more vaccines that have been granted emergency authorization in some markets.
I think overall, some countries are better vaccinated than others, some are just doing well enough, while others have not even started rolling out vaccine distribution. And this all depends on their geopolitical situation.
When I look back at the very beginning of the vaccine distribution, there was a little bit of a honeymoon period whereby people were asking “who’s gonna be the first vaccine distributor?” and “What company is going to move the vaccine, what country is going to get the vaccine?” or “Which demographic group of people will be the first vaccinated”.
This is nonetheless such a long race, and vaccine distribution will still be a topic in 2023. And so we have COVID-19 vaccines that will take nearly three years to distribute. So far, so far, so good I think. However, the real challenges still remain in front of us.
Some countries appear to be getting their vaccines to their citizens faster than others – notably Israel, the UAE and the UK. What are those countries doing well to achieve vaccination figures noticeably better? Is it the case that they were fortunate to have the right connections to enable priority access?
I wouldn’t say that this is thanks to being fortunate, but rather their geopolitical situation. If you have the money, the purchasing power and the right political positioning, then you can try to do things a little bit differently than others.
But some of the countries that you just mentioned, they have taken their own position compared to Europe’s position.
You have the European Union, which is taking a different position and trying to distribute within the whole European Union. In the news, you can see criticism about the way they do things. Obviously, there are a lot of opinions on this, but there is also a difference between an opinion and what is possible. Ultimately, it all comes down to what the real day situation is that you have to deal with.
Then you have other countries, as I mentioned earlier, that haven’t even started distributing vaccines because they’re not on the radar. Some of the people in these countries will be getting the vaccines in 2023. It seems crazy to think about, but it will be the case.
How concerned are you by the possibility of countries and companies stringently looking after themselves instead of cooperating with others?
Well, nobody has ever cared so much about healthcare and pharmaceutical logistics before. A lot of companies nowadays are trying to change their logistics and healthcare distribution approach, specifically how they move pharmaceuticals and vaccines.
So it’s important to know that there is not a single logistics supplier in the world that can do everything for everybody. That’s why it’s so important to cooperate in the sector. Specifically, when I look at our capabilities at Maersk, we’re very well positioned to support pharmaceutical companies or government ministries of health and non-governmental organizations, but even we cannot do it all by ourselves.
That’s why we’re looking for partnerships, we’re looking to collaborate with some of some of the other logistics partners in the market. And this is the one way we can gather a lot of data and intelligence on what is happening with the vaccine distribution and support in return.
We are also consulting a lot of non-governmental organizations on their approach. And during this consulting, we don’t tell them to use Maersk and ocean containers, which is where our strength is. We advise them on what the best logistic approach is. We also consider questions like “What does the country need?”, “Who should get the vaccine first?”, “What is this country’s policy?” and “How many vaccines would you need?”
Once you understand the needs of the country, you know how to set up the logistics and the supply chain. Only then can you decide what is your best mode of transport, whether it be ocean, air or overland. Understanding those needs also means you can answer questions like “Would bigger or smaller loads be better?”, “Do we have the cold chain capacity?”, and “What other supportive personal protective equipment and infection prevention and control equipment do you need?”.
Everybody thinks about how we get the vaccine to the patient, but then everything around that needs support too, from the supply of alcohol wipes to the disposal of the waste that you have to deal with eventually. The logistical challenges are evidently huge.
How close are we to having some authorised vaccines that can be transported more comfortably in a standard fridge? As far as I remember, Maersk has an agreement with Covaxx, who are developing a vaccine with these properties. Also, once vaccines such as these are developed, to what extent could they spark a noticeable acceleration in the distribution of vaccinations?
As you rightfully stated, We have an agreement with COVAXX, who are a subsidiary of United Biomedical, and we have an agreement for the safe distribution of their COVID-19 vaccine.
The COVAXX vaccine candidate, UB-612, is produced from a proven synthetic peptide-based platform and can be manufactured affordably and at scale (millions of doses) – and distributed worldwide – with existing infrastructure, which means no special freezing or other distribution needs, just regular refrigeration 2-8 degrees Celsius. To guarantee this, we at MAERSK and COVAXX have signed a major partnership agreement for the first 100 million sold vaccines. Recently they also announced an exclusive agreement with Aurobindo Pharma to expand the global development and commercialization of their vaccine to India and the United Nations International Children’s Fund (UNICEF). Aurobindo is expected to support up to 400 million doses. Maersk is the exclusive logistics provider for UB-612 for COVAXX.
The way they’re producing their vaccine means it can be transported at temperatures ranging from two to eight degrees. This would allow for a much broader mode of transportation approach in the first shipments and trials that we do, and we’re currently doing some test trials on this now.
The transportation of these vaccines would naturally start with air transport, because the speed to market is very important. Air freight is a sector where we do have some capabilities, and we’re trying to further expand on them.
However, in order to really get into mass distribution, there will also be a few other vaccines coming out that would be transportable between two to eight degrees. Hopefully by the second half of 2021, you’d have the mass production, and this would allow for a true global distribution. Crucially, this could also be done via ocean.
The reason why I believe this is that by using reefer containers, you don’t necessarily need to have the cold chain capacity in every region and destination to store the product.
So when you look at utilizing reefer containers, the temperature control containers used in sea freight, then you can create a temperature controlled supply chain with several weeks of inventory on the water.
You can even split it in different ways. There’s different approaches to this, one is where your product is in a container inside a temperature-controlled container box. Then you don’t use all of your challenge destination for having a cold storage, the container could also be powered by a genset. And you can take this container inland to different locations from where you can facilitate them to patient distribution.
So later in 2021, we are very much expecting to see mass distribution, containers being utilized. That will present the need for more capacity, and naturally, come with its own challenges.
In an article you recently published on LinkedIn, you cited India as being one of the areas with the greatest international vaccine distribution, alongside Europe. How big a role do you see India playing in the worldwide production and delivery of vaccines?
India is a country that has invested a lot in competencies and capabilities in producing pharmaceutical products. And equally, they’re very capable and knowledgeable when it comes to producing vaccines.
Also, there’s a cost element in here too, which naturally makes India very attractive. Earlier I mentioned our cooperation with COVAXX, well they have signed a commercial agreement with Aurobindo, a direct customer of ours, for the production of the COVID-19 vaccine.
That vaccine would first benefit the Indian population, but also they have signed an agreement with UNICEF for I believe, 400 million vaccines, – to be given to UNICEF for distribution in designated areas.
In this way we can address vaccine distribution in Africa or Latin America for example too.
How important will it be for governments to get their ‘people logistics’ right? It’s one thing getting the vaccines to a clinic, and another actually getting the people to the clinic itself.
Yes, definitely. And I mean, it’s not necessarily fair to turn this into a purely logistical challenge. Logistics is of course an extremely important part of the vaccine rollout. But then part of the logistics that most people perhaps don’t think about are questions like “Do you have the capacity at destination?”, “How is the government organized?”, “Who are the people that would get the first, second and third wave of vaccines?, “How do you keep track of these people?” and “Should you issue COVID-19 vaccine passports?”.
Simply keeping track of the people who have received one type of vaccine is challenging. They need to have a second dose of exactly the same vaccine – you cannot go and get the Moderna vaccine or AstraZeneca vaccine if you had the Pfizer jab first – you’re supposed to have a second shot of Pfizer.
This is a huge puzzle that needs to fall in place. At the end of the day, collaboration is extremely important here. You need to have strong logistics providers who will get the vaccine from manufacturer to to the administering center, but you also need very good coordination at the administration level to conduct the rollout correctly. On top of that, as I mentioned earlier, you have the personal protective equipment, infection prevention and control equipment to support the administration too.
What is your opinion on the debate that’s emerged regarding when someone should receive a second dose of the vaccine?
In my experience working with pharmaceutical companies, I know that they have a very strong backbone in quality assurance – every pharmaceutical product that is produced and distributed, whether it be a vaccine or any other treatment product, needs to have very specific market authorization and there are very strict standard operating procedures on how pharmaceutical products are treated, transported and administered.
So initially, of course, I would believe that the pharmaceutical company knows how to deal with this. And if a government is trying something different, they or their medical authorities will most likely have coordinated with the pharmaceutical company.
Personally, I do not have a definitive opinion on this. I think it is up to the more competent people in that field to determine what is correct.
What can be done to eliminate cold chain failures?
Cold chain is a very particular field that is growing in demand when it comes to global transportation and specifically, pharmaceutical transportation.
At Maersk, we have established a global response team for the COVID-19 vaccines to strengthen our capabilities. First off, this includes gathering Intelligence and knowing the needs for the cold chain and for the COVID-19 vaccine.
However, we have also put specialists together who can secure the cold chain in terms of knowing what are the requirements in that region during transport, at destination, and the quality framework that needs to be followed in order to have an equally sufficient product from origin to destination.
At Maersk, we are very much in a unique position to support the distribution of the COVID-19 vaccines in that we have deployed this COVID-19 response team, as I already mentioned, and looking back at our company’s integrity and the way we fall back to our core values, we are very much prepared for the challenge of supporting the industry and ensuring the patients can get vaccine and life can get back to normal.
At the moment, is Maersk’s role in the fight against coronavirus largely limited to shipping PPE and other medical equipment?
Yes and no. We are already involved in the distribution efforts because we do have air freight capabilities. Maersk is not an old fashioned steamship ocean logistics ocean carrier, it is transitioning into a logistics service provider that integrates global supply chains. We do have an airfreight product that we can offer to customers and we’re working together with those customers.
We also operate warehouse and distribution facilities across the globe. In addition to that, we have dedicated pharmaceutical facilities that can store the vaccine and any other pharmaceutical and healthcare products. We have an ocean product too of course, which is the port to port transport that we also connect with overland transport, and we’ll be moving containers overland to transport more within a particular country.
So, we are already very much involved as an integrator of logistics globally. Yes, we are also looking at a time when blockchain will move ocean containers, because we know that we are getting to a stage where we are doing mass distribution. And the importance is so much higher, because when you have a bigger batch of vaccines, you also need to be very careful with them because nobody would accept, vaccines not reaching patients.
And finally, what about other methods of transport? How do you see these being utilised in the vaccine rollout?
In general a lot of pharmaceutical products are being transported on passenger planes, and currently there has been such a big reduction on passenger planes on a global level.
Even though there has been a 20% rise in cargo planes, you still have year on year 30% less capacity in air freight. This means that there isn’t so much space in air freight, and prices are extremely high.
Can vaccines be prioritized? And is it ethically possible? Yes, you can prioritize vaccines. However, that means that other products that are critical, for example, for your family consumption or for day-to-day life cannot go by plane, they’ll need to be transported by an alternative mode.
Rail is a very, very feasible mode for goods transportation, and we have a railway option from Asia into Europe and vice-versa. So this is something that we have also been offering to our customers. Ocean freight is very relevant too, because if you need to transport PPE equipment by air, and you don’t have the capacity and you don’t have the capacity in rail either, you can turn to ocean.
You can play with different transport transport modes, and then decide what is more critical. Each transportation mode has its advantages and disadvantages, so it depends on your particular needs.
If you need to purchase, let’s say 100 million gloves for distribution into hospitals in Europe, this is something that needs to be planned long in advance. With ocean freight, airfreight and rail, there’s huge challenges right now in terms of capacity and on time delivery. It’s a challenge just finding the space, and also rates have naturally gone up due to everything that’s going on.
Therefore, it’s important to plan in due time and work with the right logistic partners. Yes, it’s extremely important to facilitate the distribution, not only the vaccine itself, but everything around it, and the impact it can have on other verticals or commodities.We at Maersk are committed to support the global social welfare and are working hard to support our customers.
Thanks you. And stay safe!