Brought to you byLONGITUDES
The coronavirus pandemic is changing daily life as we know it. Society at large is grappling with how we live and work during a time when the only certainty is more uncertainty.
Behind the scenes, however, transportation and logistics workers move the healthcare supplies and medicines needed to fuel an effective response to a global problem.
Two experts with decades of healthcare logistics experience between them — UPS Healthcare President Wes Wheeler and Rob Feeney, CEO of Medvantx, a home delivery pharmacy — join Longitudes Radio to discuss the supply chain ramifications of coronavirus and other crises.
No longer an academic exercise, logistics leaders are responding in real time to a black swan event. They’re tackling questions of monumental importance: How to ensure medical deliveries for people and hospitals most in need? How to facilitate testing for coronavirus? And what is the role of telemedicine?
Logisticians are tapping into lessons from previous pandemics to get patients what they need, when they need it. They know if there’s any breakdown in the healthcare supply chain, it has a domino effect in communities spanning the globe — they must create a truly frictionless and transparent experience.
There are a number of factors, however, aiding healthcare logistics today, including the direct-to-patient supply chain and enhanced cold chain solutions. Such innovations are effectively moving healthcare from reactive to proactive, utilizing technologies like machine learning and artificial intelligence to anticipate needs before they even arise.
With its recent realignment, UPS Healthcare delivers high-quality visibility, tracking and management options for critical healthcare shipments. Wheeler and Feeney look at the “network within a network” for UPS Healthcare products and services, as well as how the company’s Medvantx partnership will drive in-home treatments.
Looking forward, they also explore the development of coronavirus vaccines and how UPS will evolve amid the pandemic. We know this much: Whether coronavirus or any future healthcare challenge, logistics will be at the center of the solution.
[00:00:04] The right idea at the right time. The miracles of logistics every day. I just challenged all of their rules. Technology is revolutionizing this industry. Changed our lives. Close your eyes for a second. New York, Hong Kong, Paris. We're more connected. You just never know where the next innovation will come from. Rules are beginning to change!
[00:00:28] This is Longitudes Radio, a podcast with today's leading experts about the future of technology, global trade, sustainability and logistics.
James [00:00:39] I'm Brian Hughes. And I'm James Rowe. So, Brian, healthcare's obviously dominating the headlines right now with the Covid-19 pandemic. Everybody's talking about the coronavirus and its growing impact on economies and the world at large.
Brian [00:00:54] Yeah, and James, a less talked about aspect of this is the role of the health care logistics provider. With any health care challenge of a scope like this, there's all kinds of things happening behind the scenes that people might not know about. And that's what we're talking about today.
James [00:01:08] Today we've got Wes Wheeler joining us, Wes is now president of UPS's new global Health Care and Life Sciences Unit and former CEO of Marken. He has over 40 years of experience in the healthcare space.
Brian [00:01:21] And joining Wes is Rob Feeney. He's the founder and CEO of Medvantx, a leading provider of e-commerce pharmacy and final mile delivery solutions. Wes and Rob bring years and years of experience to the healthcare space.
James [00:01:34] So yeah, it's primetime to talk about the logistics behind the outbreak. Let's get straight to their insights.
James [00:01:44] We've got a lot of health care challenges that are happening right now. Many challenges like Covid-19. So we wanted just to start off talking about it through the lens of logistics and what a logistics company's role is and responding and helping manage an outbreak like Covid-19. I'm going to start with you, Wes.
Wes [00:02:06] So we have developed a very complex continuation of the business to make sure that we can we can respond. Right now, for example, we are delivering every day into patients’ homes in China. It's the first time actually ever that the Chinese government has allowed investigational drugs. These are clinical drug products that can be delivered into the patient's home, because as you probably know, in R&D, in our business, in pharmaceuticals, you have to really follow a very carefully scripted protocol. If a patient misses a dose, if he does it wrong, if he doesn't get the diary right, the patient gets taken off the study. So patients can die if they get taken off of study. So we have done whatever we can to develop a process where we can deliver a drug product to the patient's home, collect the blood in the patient's home, bring it back to the lab. And that's just a good example, very current example of what we're doing.
James [00:02:58] There's also been a case where I was reading and I think it was 2017 might have been 2018, where there was a smallpox outbreak in New Guinea. And Marken had quite a bit to do with getting samples back to the lab to be tested. So could you kind of describe what companies like UPS do to support that on the technical side during an outbreak like smallpox?
Wes [00:03:21] Yeah, I think I think the first thing you have to do is understand how to get complicated, whether they'd be dangerous drugs or dangerous materials across country borders. One of the things that Marken and UPS are very good at is understanding how to get through customs and how to get complicated, perhaps investigational products through the border. You got to understand that first, if you don't have an avenue to get through the border, you've got to deal with the local authorities. The first thing you do is clear the way for the shipments to move. Moving samples and tissue and blood is very, very common in our business. And so we know a lot about dangerous goods, about crossing the U.N. requirements that we have to follow. And that's really part of our DNA. New Guinea was a good example. We have many, many more like that.
James [00:04:07] Has it changed? Has it become harder or easier to navigate some of those borders?
Wes [00:04:13] It's complicated because every country is different. Brazil happens to be a tough one, tough country for us to get into, especially with patient collection kits. It's considered a medical device and it's hard to cross the border into Brazil. Russia, as it turns out, is an easier country to deal with than I thought it would be. But it changes from day to day. The regulations are changing. One thing that the listeners may want to know is that in the pharmaceutical industry and maybe Rob can confirm this. I think the FDA and the EMEA, the regulatory body in Europe, have finally realized that the supply chain is the last relatively unregulated part of the entire process - that you've got good control in the lab. You got good control and manufacturing facilities and good control generally in the warehouses. But between those locations, that portion of the supply chain is not well regulated yet. And it's coming in.
Brian [00:05:09] Rob, does that mesh with your experience, too? What are you seeing in the supply chain space in terms of regulations and some work that might need to be done?
Rob [00:05:17] Yeah, it does. I think building on Wes's comment, folks may not be aware that some 80 percent of all active pharmaceutical ingredient at the API - the basic building blocks of drugs - are manufactured in China. So, if there's a breakdown of the supply chain in China, it has a downstream effect...you know, all the way through the supply chain. You know, I think over the past 20 years or so, much of the pharmaceutical manufacturing in the U.S. got moved, you know, divested or moved off shore. And I think as a result of things like, you know, the corona virus, that's going to need to be revisited because it's such a critical part. You know, it rises to the level of national security.
Brian [00:05:51] This is not at all a technical question. But I am curious, given everything that you just outlined, Rob, how have these changes affected your day to day job, the types of things you're doing every day? What are some of the challenges that are most important to you that you're seeing right now?
Rob [00:06:06] Yes. So I think it's really a catalyst for change. We've already been driving and the industry has been driving like care delivery from the institutional setting to the home. We've seen, you know, an explosion in the use of telehealth. I think there's some 7 billion annual telehealth visits that are occurring in the US. You know, this year. So being able to deliver care remotely, being able to then synchronize prescriptions with that care and deliver that to the consumers home. I would say those are really two big trends that we're working through.
Brian [00:06:44] Yeah, and I wonder, Wes, given...I'm really glad you brought up telemedicine, given what we're seeing in that space, is that actually an opportunity for us collectively to be able to do things and have responses that are much more patient friendly and actually help us accomplish things a lot faster on their terms where they need us?
Wes [00:07:02] Yeah, it's a complicated question. I try to be complex whenever I can. In the clinical world - and again, that's where I come from for the last eight years, so I'm a little bit biased on the clinical side - there's a big trend towards virtual trials, which is trying to eliminate steps in this process. So not eliminating the doctor, but eliminating the regionalization of the investigators, which is the doctor's all around the world, is bringing those doctors to one central location and being able to find patients through social media, bring them in, qualify them on basically on Zoom or on some other form of telemarketing. Once they get recruited, then the only company that really touches the patient, so to speak, is the courier. Because you're bringing the drug to the patient's home and then you're collecting the blood with a nursing network that actually Marken has now bringing the blood back to the laboratory. And then the laboratory data is shipped back to the pharmaceutical company or the CRO for analysis. So, technically, we're eliminating a lot of the local points of touch - of contact - with the patient.
Brian [00:08:07] Rob, I wonder if you could talk about one thing. I think a lot of times when we think of health care, we think reactive, right? I mean, we see everything in the news and everyone's scurrying and it's really tough. Can you talk about the things that you and your company is doing proactively to plan for these types of situations? Not just now, because, by the way, there's going to be all kinds of events of different stripes in the future. What's happening behind the scenes?
Rob [00:08:32] Most companies would typically design supply chains around their internal requirements. And so, we think a lot about what it would happen if you put the consumer first. You know what with that supply chain look like if you designed it to provide services to the consumer. You know, you've heard terms like anticipatory logistics where you use things like machine learning, automated intelligence, different types of cloud computing to figure out where will the product be needed before it's actually even used. And so, we spend a lot of time trying to figure out how to redesign our supply chain to be more anticipatory. An example of that is like our partnership with UPS, where we embedded a pharmacy inside UPS World Port so that, you know, a consumer can go online ordering medication up until about one o'clock in the morning, get that medication on an airplane and deliver it to the consumer before 10:30 a.m. the next day. So, it's around developing a supply chain that really anticipates what the consumer needs and then figuring out a way to get it quickly across the doorstep.
Brian [00:09:29] I have to admit, I've worked at UPS for a few years and I didn't know about this pharmacy. Could you tell our listeners what it looks like, what you're doing, what they could expect if they were in Louisville one day, if they saw it?
Rob [00:09:39] As you can imagine, UPS health care is probably one of the more preeminent health care logistics platforms globally - and inside that facility in Louisville, we've embedded a home delivery pharmacy. And, so, we're able to leverage all the UPS logistics capabilities. You know, inventory can come across the building, be converted into a consumer's prescription, and then literally put on an airplane out for delivery. So it collapses the supply chain. So, it removes steps in the process. And for things like Covid-19, it can be an incredible asset because it can react quickly. It can increase speed to therapy and it can really reach that consumer in their home very quickly.
James [00:10:19] You mentioned Covid again. Let's talk a little bit about contingency planning during some of these crisis and moments that we have. Backup systems, multiple distribution centers. How do we prepare for stuff like this in terms of redundancies and in crisis planning?
Wes [00:10:33] We can use both commercial and UPS, the Brown tail, the best airline is actually our first choice whenever we ship. There's a lot of advantages to that course. Cost is one. And the fact that UPS will treat us with great respect when we put our shipments onboard. But we also have at least one or two backup commercial carriers in every lane and we're operating hundreds of thousands of lanes. And it's as you can imagine, it's complicated. It's logistics. So, we have lots of different ways to get products and blood and serum across the borders.
James [00:11:04] So, Rob, I want to toss this to you. Getting back to the contingency planning on your side when you're trying to get pharmaceuticals direct patient and home and during these crisis times that that we're facing through outbreaks such as Covid-19, how do you plan for redundancies and backups?
Rob [00:11:24] Yeah, so good question. It was one of the catalysts behind our decision to embed a pharmacy inside world port, because if you think about being able to have a backup facility to our other pharmacies, you really can't create a better, more scalable solution than to embed one inside the global logistics infrastructure of UPS. But I think what's interesting about Covid is that this has moved from kind of an academic exercise, most companies have backup plans, but now I think this is really the true black swan event. I mean, we're actually having to deploy these types of backup scenarios and so we're trying to, as a company, figure out how to make work out a place you go to - it's this thing you do. So, whether that's using collaboration software like, you know, Slack, MS teams, you know, we're in conversations right now with state and federal agencies to allow our pharmacists to actually perform the clinical and dispensing functions remotely. So there's a whole series of different technical solutions, regulatory solutions that we're having to navigate to make sure that we're up and running. I mean, we manage about seven and a half billion dollars of drug therapy for our clients. And, you know, those medications need to get there. It's not something that's, you know, can survive any kind of a blip in the supply chain.
Brian [00:12:36] And speaking that Wes, I wonder if you might talk about how UPS is realigning its capabilities to meet the challenge that Rob just laid out. I know there's been a lot of movement on our part. What do those changes mean in real world terms in our ability to deliver services to our customers?
Wes [00:12:52] Yeah, I'll give you two examples. One is a commercial and one is a clinical. So, in the commercial side, we had about a year ago decided that we were going to make changes in our network to improve the performance of the network for pharmaceuticals. So, we have developed a product called UPS Premier®. So, we're really excited about it. This is a network inside of a network. So, we're actually putting technology into all of our hubs and buildings around the country. We are now radio labeling, RFID labeling our packages. We're putting a critical package visibility label on it and the DIADs so we can actually see the kinds of shipments that are coming through the network that are critical. And we're seeing now in our pilot with seven customers now about a full percentage point improvement on our on-time performance by time. So, getting there before 10:30 the next morning. That's the commercial and we're really excited about that. We think the pharma companies will really react to it. On the clinical side, we'll talk more about this perhaps later, but the cell and gene therapies, I know Rob will be well aware of this - is the biggest thing that's happening I think in pharmaceuticals today. There are a thousand trials now in development - Phase 2 and Phase 3. Personalized medicine is another way to talk about these things, but they are massive disruption to the whole pharmaceutical supply chain. And we are going to be the leaders in terms of supply chain logistics.
Rob [00:14:18] So today the supply chain is really designed to support traditional oral solid medications. And what Wes is talking about is more personalized medications that require both diagnostics and medication therapy together. This also requires a lot of infrastructure and cold chain. So, the ability to handle very specialized packages, temperature sensitive.
Rob [00:14:39] So, as we're building out our pharmacy network, we're thinking more about how to move that kind of infrastructure closer to the consumer. We're actually trying to leverage those types of models to be able to deliver these new clinical therapies very quickly to the home setting. So, it really requires a quicker network and it requires the ability to be closer to the consumer's home.
Brian [00:14:59] And Rob, for the uninitiated, can you just explain why the cold chain is different, why you have to be so much more exact and precise and visibility is so crucial?
Rob [00:15:09] Yeah, so the temperature sensitivity to these products, they have to be managed in a very tight range. And as Wes talked about the network within the network, these packages can't be treated as a normal drug or, you know, a book or any other product for that matter.
Rob [00:15:23] They need to be very closely monitored track from the entire supply chain from point A to point B. So that's where we work with UPS. They have all of those types of capabilities Medvantx can leverage that infrastructure, but it's one of the reasons why we're embedded inside World Port is to be able to leverage that cold chain infrastructure of UPS.
Wes [00:15:40] I mean, just to expand on that for the clinical side because certainly therapies approved I think commercially at the moment in the U.S. But so most of the work is in clinical. The samples that come from the patient, which is part of the diagnostics that Rob is talking about, are shipped typically at 2 to 8 degrees and it has to be within, say, 48 hours delivery in order for that tissue to be still viable for the analysis. When the final drug product or therapy is approved or built in the lab, it has to go back to the same patient for the autologous type of cell and gene therapies, and it's usually shipped in minus 150 or lower centigrade shipments. So liquid nitrogen cryogenically shipped. And then those shippers have to be returned because they're expensive.
James [00:16:25] If we get to the point where we have or when we get to the point where we have a vaccination for Covid-19, let's talk about the importance of the network in getting that shipped out there and then also some of the tools that we use to get it out there like the cold chain and keep it at the right temperature.
Wes [00:16:42] It's like. That the vaccine will be temperature controlled. I think you'd agree with that. Of course. We don't know much about it yet, it's in development. Hopefully it'll be fast tracked. I think there's gonna have to be some kind of a rationing program because it's gonna be a massive demand for this. There's already a massive demand for test kits. As soon as the vaccine is developed and approved with an accelerated FDA approval program, I think there will be some method to move that drug around the country.
James [00:17:07] And you did mentioned scaling before. Like, how are our warehouses can scale to hold greater amount of vaccinations?
Wes [00:17:14] I think there's a problem at all. Yes, space won't be a problem. I don't think either transportation will be a problem. I think it's gonna be supply.
James [00:17:21] Supply. Right. And Rob, how about you?
Rob [00:17:23] Yeah, a similar view. I mean, if you think about there's a issue right now is the test kits, but no one's really talking about the reagents and some of the other supplies that are required to complete the test. So, I think, you know, following Wes's comment, this will be some sort of controlled rationing type of a distribution model. You can think about leveraging technologies like telehealth, interactive web sites, you know, where you could deploy care and the product at the same time. So, I think that there's some interesting, you know, models there. We could create kits where drugs, diagnostics, ancillary products are all required in one integrated package to the consumer's home. I think there's a tremendous opportunity there for, you know, this more direct patient supply chain to rise. And I think Covid-19 is really just an example of where this is headed.
Wes [00:18:08] Wes, there's obviously a lot of conversation about the potential of drones. Through the healthcare lens, where do you personally see the most potential for drones in the healthcare space?
Wes [00:18:18] You probably know we've done a lot of work in Africa to kick this off. Think we're one of the first companies actually do this in a humanitarian way. That was very successful. The drones that we use in that case had a long range. They were able to reach remote villages in Rwanda and help to help the people there. We've done the same in Papua New Guinea with Marken. So, we have seen a lot of good utility in very remote places where you just can't get. You just can't get trucks and vehicles. And it's been very helpful for that reason. And I think I think that's probably the most utilitarian way we can use drones in the next five years.
Brian [00:18:55] And essentially, it's really right now only that technology that allows you to get into those spaces that we couldn't before. Correct.
James [00:19:02] So when we look at the complexity of the supply chains in our response to some of these crisis outbreaks, pandemics, that kind of thing, it seems like we need a lot of partnerships to get it done and to scale. Could you speak to the need for some of those partnerships to scale?
Brian [00:19:21] And especially what Medvantx does within that space.
Wes [00:19:22] Right, right. So, what we're doing with Medvantx is really quite groundbreaking. And we we'd like to see more of it happen. We're getting a lot of requests from our pharmaceutical clients, as is Rob, to do more work in the home and to get deliveries to the home from a central location. And we have lots of central locations around the world. We'd like to see how we can partner with Medvantx more to be able to bring drug product into commercial or clinical drug product into a location and have an immediate way to ship that to the patient's home and skip all the points - all the nodes in between. So to speak.
James [00:19:57] So, and Rob, in terms of scaling and doing that through like UPS's system. Could you just describe how you do that in our in our network?
Rob [00:20:06] Yes. So, we've as Russ mentioned, we've embedded a pharmacy inside UPS, his healthcare campus, inside World Port and end of runway pharmacy. So it's capable of, you know, taking medications, converting them into prescriptions, getting them on airplanes up until 1 o'clock in the morning Eastern Time and delivery to the consumer's home within...by 10:30 the next day. That is today impossible in pretty much any other delivery modality. And I think, you know, as we think about into the future, it's all land speed, speed to therapy. There's so many different people working on final mile logistics and different ways to get product to the consumer's home. And we think that this partnership between Medvantx and UPS is a first fairly scalable effort to bring that kind of final mile solution, leveraging UPS's network to do same day delivery of prescription drugs.
Brian [00:20:53] That's great. And now to both of you, we can't let you go before you pull out your crystal balls for us. I want to know five, maybe even 10 years from now. How is the general population looking differently at the role of the health care logistics provider?
Wes [00:21:07] Well, to me, the most exciting thing that's happening in our industry is that the personalized medicine, that's for sure, in terms of how it affects how the industry affects us in the next five years, look out for biologics. Right now, 28 percent of all the drugs in commercial use in the U.S. are biologically derived, organically derived. That's going to grow. Right now, I think more than almost 50 percent of all drugs in development for mainly different types of cancer are also biologically derived. And all of these drugs are sterile in nature, sterile means. It has to be sterile, it has to be handled carefully as to be handled under temperature conditions, usually to 8 degrees centigrade, and they have to be within, say, 48 hours delivery to be in stability. So, it's very, very important that the supply chain, UPS is going to have to get very, very good at cold chain delivery.
Brian [00:21:58] And Rob, let us know, what are you seeing down the road?
Rob [00:22:01] We've talked today about designing supply chains around consumers. In some ways, consumers have come to expect a semi-frictionless process from online to delivery. And I think that that will kind of lead over into the pharmaceutical area and consumer expectations will be of our pharmacy supply chains and networks to be able to take a medication prescription online, to use a telehealth visit and to have that drug delivered within 24 hours or less. So I think it's the integration of e-commerce, telehealth and these final mile logistics solutions that are really exciting you know, as we think forward 5 - 10 years.
Brian [00:22:37] Wes, Rob...thank you so much for joining us. This is a conversation that I think will only become more relevant in the months ahead. Thank you. Thanks. Thank you. If you'd like what you heard today, check us out and leave us review on iTunes, Spotify and Stitcher. You can also read our blog at UPS.com/longitudes where we post new content every weekday.
Longitudes explores and navigates the trends reshaping the global economy and the way we’ll live in the world of tomorrow: logistics, technology, e-commerce, trade and sustainability. Which path will you take?