Distributing the COVID-19 vaccines is a mission critical action that will no doubt save more lives and relieve the much-pressured medical system. If the actions are done well throughout the supply chain, the vaccines will be distributed to all the desired destinations, on time and in good condition (based on the a specific range of temperature for each vaccine).

But what are the challenges and how can we do the best in logistics and supply chain to achieve better results in this very important mission. We recently had two industry and supply chain experts join us to discuss this topic during a LinkedIn Live session: Fab Brasca, Blue Yonder GVP of Global Solutions, and Suresh Acharya, Blue Yonder Scientific Advisor and the University of Maryland Professor in Business Analytics. As Senior Director of Solutions Marketing, I had the privilege to the be the host for the session. Below is an excerpt of the conversation.

Necessary Journey from the First Mile to the Last Mile

Terence: Let start by understanding the Supply Chain of the COVID-19 Vaccines.  Suresh, I understand that you have looked into this quite deeply. Can you please walk through with us the journey of the vaccines, from the first mile to the last mile?

Suresh: The vaccine supply chain follows the same process as other products: Make – Move – Consume (or administer).  And the make or manufacturing process here includes its own BOM: not just the mRNA but also the lipids and other simple chemicals.  And then there is the vial, the stopper, etc., and also the case/special packaging. So, all of these ingredients and components are needed to create the vaccine.  I mention this because Pfizer has already announced a short-term hiccup on their supply side revising their initial plans of 100 million doses by end of the year to just 50-60 million.  Fortunately, they will be able to make it up in early 2021. The Moderna vaccine just got authorized, so we are yet to learn about their supply chain issues, if any. 

So that is on the make side.  Then comes the distribution – from the plant to the last DC in the supply chain. Pfizer has chosen to work with logistics provider to ship vaccines directly from their plants (in Kalamazoo and Belgium) to the various states and specified DCs.  Moderna, on the other hand, will leverage McKesson for its distribution needs.  Some of these differences are warranted because of the complex Cold Chain that is involved with these vaccines.  The Pfizer vaccine needs to be stored/moved at -70 degree Celsius and the Moderna at -20 degrees.  You can already start to see the complexities of this massive effort.

And then comes the consumption or administration of the vaccine – the last mile.  This is the movement of the vaccines from the last node in the supply chain to the local hospitals and pharmacies. Again, all in the requisite “very cold” temperatures. 

Terence: The vaccination will go on for many months. We will see very large volumes of vaccines moving through the supply chain. Fab, can you let us know what kind of challenges you anticipate during the last mile, as well as— the very long— first and intermediate miles?

Fab: The scope of the global vaccination distribution is huge – approximately 15 billion doses globally due to the two dose requirement.

The first mile requires multifaceted coordination, as Suresh discussed. As for the last mile: most people think of e-commerce deliveries to suburban neighborhoods when they hear last mile. But for remote areas with low populations, the “last mile” covers very long distances and presents extremely challenging infrastructure. Until a vaccine with a longer shelf life and less stringent cold chain requirements is consistently available, it will be largely impractical to distribute to the villages and remote corners of the world. It is a wonderful start, but just the beginning.

The large volumes of refrigerated assets present another set of hurdles. Maintaining the integrity of cold-chain requirements exponentially multiplies last-mile challenges in tropical and developing countries.

Supply chain assets, like the refrigeration assets, as well as capacities, are very limited in the field. To leverage these assets and capacities to move vaccines through the network, there are difficult trade-offs as items normally being moved will have to be addressed. Temperature control, such as Pfizer’s vaccine needing to be kept at -70C may/will present the need for local sources such as dry ice. So, disruptions can then be costly.

Essential Enablers

Terence: With the above production, distribution and last-mile challenges, a second question for you, Fab, what are the solutions that will help logistics and supply chain operations to improve, for example, agility and resilience, in order to increase the confidence levels of on-time, in-full vaccine arrivals?

Fab: There are several key aspects. In upstream manufacturing and supply chain, as Suresh mentioned, we need to match the supply to demand. In the distribution part of the equation, coordination and alignment of transportation, storage, as well as how the vaccines flow out of production is key. Instead of thinking about individual solutions, we have to keep a mindshare that all of the aspects have to flow together, seamlessly, to avoid disruptions.

The overall monitoring of the flow of inventory for the bill of materials, not just the vaccine, is important. In order to link all the items in the bill of materials in an incredibly fluid way, the notion of global visibility becomes really important. Because of complexity and criticality, global visibility plays a significant role in seamless transitions from first to last mile. By visibility, it is not just knowing where the truck is, but understanding the flow of supplies to meet the demand. The definition of inventory is not just the vaccine, but all the components required.

There has never been a stronger argument for AI, ML, IoT devices to enable global visibility. Things disrupt supply chains all the time – late trucks, disruption, traffic, weather – but the consequences of out-of-stocks or late e-commerce deliveries are not as significant as a load of vaccine being damaged or disrupted. Clearly, enhancements to support the cold chain, awareness of disruptions and delays (very different than stocking shelves), and ability to rapidly react are critical.

Solving the Objective Function

Terence: The last mile ends at the point-of-care and that leads to the obvious question: who will get the vaccine first?  We’re getting a glimpse of this right now and it seems to make sense.  Suresh, you have been keeping abreast of the distribution objectives and their impact.  What can you share with us on this subject?

Suresh: This is a very fascinating topic.  And one that has already started to make the headlines.  Clearly, the first to get the vaccine will be the front-line workers, the nurses, doctors, medical professionals, first responders, etc.  The current prioritization will then be to the elderly, especially those in nursing homes.  And then gradually to other segments of society.  And that all makes sense. 

Strictly from an analytical perspective, this is very much a supply and demand challenge.  Especially early on when supply is limited.  The optimal matching of supply and demand requires a criteria or objective function. Clearly, when the objective function is to minimize death, the elderly deservedly will be prioritized. Gradually, when the objective function becomes one of minimizing spread, then one can argue that college and university students should be prioritized.  So, we have just began the vaccinations and it will be interesting to see how the policymakers will prioritize the distribution.

As the Situation Evolves

As the vaccine distribution situation evolves, Fab and Suresh have agreed to participate in another LinkedIn Live discussion.

https://www.linkedin.com/company/blueyonderai/Tune weekly to Blue Yonder’s LinkedIn Live sessions on Tuesdays at 4 p.m. ET and Thursdays at 12 p.m. ET.