FDA approval came too late for last year's flu season. But Wyeth Pharmaceuticals plans to make up for lost time with this year's launch of its nasal influenza vaccine, FluMist. It's banking on a high-tech cold chain distribution network to make it happen.
John Johnson joined the DC Velocity team in March 2004. A veteran business journalist, John has over a dozen years of experience covering the supply chain field, including time as chief editor of Warehousing Management. In addition, he has covered the venture capital community and previously was a sports reporter covering professional and collegiate sports in the Boston area. John served as senior editor and chief editor of DC Velocity until April 2008.
For nearly half a century, Americans have coughed, hacked, wheezed and sneezed their way through flu season with no prospect of protection other than the traditional flu shot. That's about to change. This fall, as several new strains of flu threaten to attack nasal passages across the country, Wyeth Pharmaceuticals will launch a brand new weapon in the cold wars: a flu vaccine available in nasal spray form. The product, which is actually a live (though weakened) virus that is frozen at the point of manufacture, will be the first flu vaccine not administered by injection. That means that with some of their patients, physicians can drop the needle once and for all (at least where influenza is concerned).
Right now, rows of FluMist injectors sit frozen—not in time, but in the chilly (minus 22 degrees For minus 30 degrees Celsius) interior of a distribution center on the outskirts of Louisville, Ky. The spray received final regulatory approval from the FDA this spring, and it's now ready to emerge from the deep freeze.
The highly automated 86,000-square-foot facility was built last year in anticipation of FDA approval that didn't come in time for last year's flu season. But Jim Cafone, who leads the distribution and transportation function for Wyeth Pharmaceuticals, puts the best face on the delay: "It's true that the building has been a frozen asset for us," he says, "but the good news is the delay allowed us to stress-test the systems and make sure things were running smoothly."
Big chill
Though technological breakthroughs could someday ease the distribution challenges, right now, FluMist is definitely not ready to come in from the cold. Because the product is actually a live virus, it is stored prior to distribution at temperatures no higher than minus 22 degrees F. Exposure to ambient temperatures could affect product stability.
That meant starting from scratch where DC construction was concerned. "There was no real prototype DC out on the market," says Cafone. "If we were just building a typical DC, we could easily go out and look at material handling options and different labor strategies. You can benchmark freezer applications like ice cream storage, but there's no way to go out and benchmark deep frozen applications for pharmaceutical distribution. We've got very strict regulatory requirements to follow."
Given the absence of hard guidelines, it seemed prudent to call in the pros. The Wyeth team hired WEPCO, a Pittston, Pa.-based material handling integration firm, to design and implement many of the systems used in the DC. After testing prototypes at its own facility, WEPCO drew up the center's floor plan. Once the floor plan was set, the DC was essentially built around it.
The focus, of course, was on creating a fail-safe operation as well as accommodating the product's unique requirements, which meant much of the equipment had to be custom designed. When the vaccine (which is manufactured near Philadelphia) arrives at the Louisville DC in deep frozen tractor-trailers, the trucks back up to one of two specially designed dock doors,and an inflatable dock seal,custom made by Bondor Manufacturing, forms an airtight grip around the truck. Once the warehouse doors are opened, a vertically stored dock leveler made by Overhead Door Corp.'s McGuire division is lowered into the truck, and the narrow buffer area—or vestibule—between the truck and the warehouse is quickly cooled to minus 22 degrees F. At that point, product can be moved from the truck into the receiving freezer and ultimately into the storage freezers with no exposure to ambient temperatures.
The freezer dock door system "isn't rocket science," admits Christopher Paulsen, chief executive officer of WEPCO, "but to our knowledge it's never been done before. Basically we had to design something that would ensure that ambient temperatures never came in contact with the product."
Once unloaded and checked in, pallet loads of product are eased onto conveyors designed and manufactured by Hytrol Conveyor Co. and transported in freezer tunnels to one of two 13,500-square-foot main freezers, each capable of holding 1,200 pallets. Inside the main freezers,two ASRS cranes fromWoodson Inc. maneuver the pallets through the system. Once the shipping cycle begins, pallets are moved from the freezers on conveyors through the freezer tunnels to a depalletizing station, where a pair of hightech robots manufactured by Fanuc Robotics place individual cases of FluMist on a second conveyor system.
All of this automation is aimed at minimizing human exposure to the harsh storage environment. "We didn't want to put a human into this environment for a prolonged period," explains Cafone. "OSHA will allow limited exposure to such extreme temperatures, but we tried to engineer the human out of the deep frozen conditions as much as possible by using AS/RS, robots, conveyor systems and a patented pick module." In fact, the cold environment is too harsh for even the robots to handle; they sport space-age parkas that keep them 50 degrees warmer than the actual interior temperatures.
After leaving the robots, the cases of product move to one of eight custom-designed airlocks, which were made by Tinsley Design & Fabricating Inc. The airlocks give order pickers working in an ambient pick/pack room access to the cases of FluMist, which must be kept at freezer temperature while indivi dual orders are picked and packed . Though the pick/pack room's temperature is a constant 65 degrees, the humidity levels cannot go above 50 percent to avoid frost buildup on the equipment. (Wyeth's warehouse management system monitors temperatures here and throughout the building.)
"Pick/pack is the most critical phase of the operation," says Dennis Gniazdowski, FluMist distribution center project director. "We have less than 90 seconds to complete the pack-out process, including picking the doses, packing them in a special expanded polystyrene (EPS) foam shipping box with dry ice and dunnage,and sealing the lid. All of the steps are automatically measured by timers, scales, photo eyes and bar-code scanners so we can monitor the process for compliance." (All of those controls were provided by Dynamic Automation Ltd., which also provided the user interface software.)
Once the lid is applied to the shipping carton, the carton is dispatched to another Hytrol conveyor for a five-minute ride to the dock door, where it goes through a final manifesting process before being loaded onto a truck.
The ice men goeth
Once product is ready to be shipped, the clock again starts to tick. Shipments of FluMist must reach their final destination— physicians' offices and pharmacies across the country—within 30 hours of the time they're packed.
To manage the critical transportation segment, Wyeth partnered with UPS Supply Chain Solutions and Total Quality Logistics. Total Quality Logistics built three specialty trailers with satellite tracking systems that let Wyeth monitor environmental conditions during the inbound shipping process."If we notice that a temperature is veering outside of our limits, a variety of people are notified immediately via satellite beeper so that someone can rectify the situation," says Cafone. "This is another activity that is unique to this logistics process."
UPS Supply Chain Solutions, which also handles order fulfillment for the Louisville facility, carries out the actual next-morning deliveries to Wyeth's customers. FluMist is over-packed in dry ice and shipped in a specialized shipping container. But dry ice, which gives off carbon dioxide, is considered a hazardous material. Therefore, if shipments reach a certain volume, Wyeth risks exceeding the dry ice hazmat "shipping budget" for UPS's nightly air sortation and delivery process. Staying within those limits adds another daily logistical challenge.
Before Wyeth and UPS start the daily picking and packing process, all daily order volume is mapped against a hazmat budget for the destination delivery ZIP code. Then, orders that are slated for delivery the next morning are batched and sent in waves to the floor for picking. "We want to make sure that if an order is picked, it absolutely arrives at the customer's doorstep by 10: 30 a.m. the following day," says Mark Hale, director of UPS-SCS Health Care Operations. "If the order volume exceeds the nightly dry ice airlift budget, then shipments could be rerouted."
Double or nothing
Losing a day's worth of shipments to spoilage would be a problem. But losing a DC's worth of inventory would be a catastrophe. Early in the planning process, the Wyeth and WEPCO executives found themselves brainstorming ways to prevent product spoilage resulting from an equipment failure, power failure or other natural disaster. Given the high value of the items being stored, they opted to build in redundant equipment at all phases of the operation.
As a result, the DC today features double conveyor lines, double freezers, double picking zones—even doubles of all the material handling equipment. Electricity is supplied via two separate power feeds from two different substations. The redundancy drove up construction costs considerably, but the team felt the investment was justified given the value of the inventory involved.
"We wanted the highest level of customer service,"Cafone recalls with obvious pride. "[Building this DC] was definitely a highlight for our team. Most people don't get projects like this in their entire careers. Some people might say 'I built three DCs,' and although that's always a monumental undertaking, they generally had benchmarks to guide them. That wasn't the case here. We were pretty fortunate to be part of it. Not many people can put this type of thing in their dossiers."
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.
Serious inland flooding and widespread power outages are likely to sweep across Florida and other Southeast states in coming days with the arrival of Hurricane Helene, which is now predicted to make landfall Thursday evening along Florida’s northwest coast as a major hurricane, according to the National Oceanic and Atmospheric Administration (NOAA).
While the most catastrophic landfall impact is expected in the sparsely-population Big Bend area of Florida, it’s not only sea-front cities that are at risk. Since Helene is an “unusually large storm,” its flooding, rainfall, and high winds won’t be limited only to the Gulf Coast, but are expected to travel hundreds of miles inland, the weather service said. Heavy rainfall is expected to begin in the region even before the storm comes ashore, and the wet conditions will continue to move northward into the southern Appalachians region through Friday, dumping storm total rainfall amounts of up to 18 inches. Specifically, the major flood risk includes the urban areas around Tallahassee, metro Atlanta, and western North Carolina.
In addition to its human toll, the storm could exert serious business impacts, according to the supply chain mapping and monitoring firm Resilinc. Those will be largely triggered by significant flooding, which could halt oil operations, force mandatory evacuations, restrict ports, and disrupt air traffic.
While the storm’s track is currently forecast to miss the critical ports of Miami and New Orleans, it could still hurt operations throughout the Southeast agricultural belt, which produces products like soybeans, cotton, peanuts, corn, and tobacco, according to Everstream Analytics.
That widespread footprint could also hinder supply chain and logistics flows along stretches of interstate highways I-10 and I-75 and on regional rail lines operated by Norfolk Southern and CSX. And Hurricane Helene could also likely impact business operations by unleashing power outages, deep flooding, and wind damage in northern Florida portions of Georgia, Everstream Analytics said.
Before the storm had even touched Florida soil, recovery efforts were already being launched by humanitarian aid group the American Logistics Aid Network (ALAN). In a statement on Wednesday, the group said it is urging residents in the storm's path across the Southeast to heed evacuation notices and safety advisories, and reminding members of the logistics community that their post-storm help could be needed soon. The group will continue to update its Disaster Micro-Site with Hurricane Helene resources and with requests for donated logistics assistance, most of which will start arriving within 24 to 72 hours after the storm’s initial landfall, ALAN said.