The time to plan is now: interview with Dr. Clive Hohberger
Once we have a Covid-19 vaccine, what happens next? That’s a question the supply chain community should be asking itself right now, says Dr. Clive Hohberger.
David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
Our lives and our economy will never really get back to normal until we have an effective vaccine for Covid-19. But just developing the vaccine is not enough. There’s also the matter of distribution—that is, creating a plan for swiftly, safely, and equitably distributing billions of doses to patients all over the world.
Dr. Clive Hohberger has been giving the matter a lot of thought, both tracking the progress of various vaccine trials and considering the logistics implications of what happens next. With a background in both biomedical engineering and supply chain tracking technology, he brings a unique perspective to the coronavirus vaccine discussion.
In the 1970s, Hohberger, who has a Ph.D. in engineering from Case Western Reserve University, worked in biomedical engineering at Brookhaven Lab and Abbott Laboratories, and conducted postdoctoral research at the Montreal Neurological Institute of McGill University. He then shifted to the automatic-identification and data-capture field, working at Zebra Technologies for 24 years before retiring as vice president of technology development in 2008. He continues to consult with blood banks and pharmaceutical companies on systems to track and monitor vaccines and medical devices.
Dr. Hohberger spoke recently with DC Velocity Editorial Director David Maloney about the prospects for a Covid-19 vaccine and why we need to be planning now for the monumental logistics challenges ahead.
Q: The whole world is waiting for a vaccine so that we can resume our normal lives. Why does it seem to be taking so long?
A: The Covid-19 vaccine development process is actually going to be remarkably short compared with all the vaccines we’ve previously developed. Normally, this process takes two or three years. In this case, we are trying to condense it into about one year by overlapping R&D and manufacturing startup, and fast-tracking regulatory approval.
Through the World Health Organization (WHO), we’ve had tremendous world cooperation at the scientific level with all countries. The regulatory agencies—like the U.S. Food and Drug Administration—are closely monitoring the field trials so that approvals can come very quickly. So, if anything, it’s going to be a much shorter development process than we’ve seen with other vaccines, probably by several years.
Q: I understand the actual development of candidate vaccines took relatively little time. So are we now waiting to see how they do in clinical trials?
A: Yes. Clinical trials involve testing vaccines in a large number of infected patients. That is a process that takes time. First of all, you have to have a large patient population. Unfortunately, we do. You also have to have prototype vaccines manufactured in sufficient quantity for the trial and multiple medical institutions that can manage the trials.
There are a lot of cooperative alliances between research organizations and manufacturing organizations to build the facilities and start manufacturing some of the vaccines while the clinical trials are still in progress. A tremendous amount of capital is being risked on vaccines that may not make it to market. But the fact that very large corporations like AstraZeneca, Pfizer, and Johnson & Johnson are investing in this indicates the degree of confidence among pharmaceutical manufacturers.
Q: Why do scientists feel a vaccine is the solution for the pandemic?
A: Part of it is we have no choice! There is no therapeutic cure for Covid-19. There are some promising new therapies, but there is no cure yet. The only way to keep this virus from posing a continual threat to our lives is to develop a vaccine and then vaccinate a large enough population to create herd immunity. This is a really critical point. Eventually, all 7.8 billion people in the world will need to be vaccinated. It is a massive global effort.
Q: So, without a vaccine, developing that same level of protection through herd immunity would require too many people getting sick and dying?
A: Yes, we aren’t even sure about how much immunity people are going to have after they’ve had Covid-19. It may not be like chicken pox, where you have the disease once and are immune for life. It may be entirely different. We don’t know that yet. We’re taking a tremendous amount of risk on the final solution, which is to come up with a long-lasting vaccine that will prevent people from contracting the disease in the first place.
Q: The scientists and medical community are taking different approaches to creating a vaccine. Why are they developing different types of vaccines all at the same time?
A: Well, for several reasons. The first reason is that while traditional methods of developing a vaccine using an inactivated virus are tried and true, they take time and they have very complex manufacturing requirements. The second is that this is a very unusual virus, and it has a couple of features that will make it possible to develop a vaccine that will be less sensitive to the virus mutating, which is a key issue with all viruses. Researchers are very confident they can develop a vaccine because of the unique features of this particular virus.
The other thing is that we now have processes based on knowing the DNA sequence of the virus, and we are putting into practice new technologies like recombinant DNA and the use of messenger RNA that have been developed in the laboratory. So, we are using all of what we’ve learned about genetics in the last 30 years to try and take a different, and maybe better, approach to making a vaccine.
Q: Where are we with some of the more promising candidates?
A: By way of background, there are three phases of clinical trials. Phase One is where you just determine that the vaccine is safe. Phase Two is when you actually start testing it to see if it will produce patient antibodies. In Phase Three, you test a large population of infected patients—typically, 10,000 to 30,000—on a double-blind basis and see how well it works compared with a placebo.
Today, one vaccine is well along in Phase Three trials. It is a relatively conventional vaccine developed at Oxford University. And there are three other ones that are starting Phase Three clinical trials, which means they have already been proved safe and have been shown to produce antibodies in patients. There are also another 120-plus candidates in the pre-clinical R&D stage.
Q: We’ve had trouble developing adequate testing capabilities in this country. What makes you confident that we’ll actually be able to develop, produce, and distribute the vaccine?
A: Part of the testing problem is that we’ve been developing the tests on the fly while we’re also trying to treat patients. So, there wasn’t time for the tests to go through the normal development process. Remember that Covid-19 did not exist until last December, so we have been trying to test and treat in parallel. Yes, there have been problems developing effective tests. But there are tests now that work adequately, so we’ve been able to conduct widespread testing.
Vaccination is a different matter entirely. One, you’ve got a lot of people you need to vaccinate, and during manufacturing startup, you’ve got to pick which subpopulation you’re going to immunize first. Do you start with the elderly population? People in nursing homes? One country can’t just hog all the vaccine for itself because people in all parts of the world are going to need it as well. So, you are going to have to figure out which subpopulation to begin with limited vaccine availability.
The next challenge is convincing people that the threat is real and that they need to get vaccinated. We have to get to the point where at least 50% to 80% of the population has been immunized in order for the vaccine to create herd immunity.
One problem is that, in this country at least, there’s a vocal anti-vaccine movement among people who don’t trust science and who don’t trust vaccinations. It’s going to take a lot of work to convince them that it’s safe.
Q: So far, the Covid-19 response has been largely left up to the states, which have ended up competing with each other for personal protective equipment, testing kits, and supplies. Given the current model, how will vaccine distribution be any different?
A: We’ve got to change the model. Unfortunately, the process has become so politicized that we have states competing for resources that the federal government ought to be managing and providing. Due to the lack of federal leadership, we have a few states like New York, Illinois, New Jersey, and Connecticut that have done a great job of controlling the spread of the virus, while states like California tried to do a great job and basically got sabotaged. And then you have had deniers in places like Florida and Texas who are now suffering the consequences. It is really because the national leadership was never there and is still not totally focused on its response to the pandemic.
Q: How can we ensure that enough vaccines will be manufactured and then made available to people who need them?
A: I think the vaccine manufacturing part of it is already well in hand. You have some of the largest companies in the world engaged in the effort—companies like AstraZeneca, Pfizer, and Sanofi as well as the huge Serum Institute of India and Sinovac and SinoPharm in China. So, the manufacturing side is probably more committed to it than the distribution side simply because people haven’t yet thought about how we’re going to distribute Covid-19 vaccines at the same time we’re also distributing vaccines for measles, shingles, polio, and other diseases.
Q: Will the Covid-19 vaccines require any special handling?
A: Virtually all of the vaccines that are in clinical trials right now are cold chain products. We have a well-established global distribution system for vaccines like polio. However, the last-mile problem is very serious when you get to developing nations that may not have adequate refrigeration capabilities in field clinics. The challenge there is to deliver the vaccine to the point of use quickly and ensure that it’s safe at the time it’s administered.
This is why WHO standardized time-temperature indicator labels—known as Vaccine Vial Monitors or VVMs—that allow a person to visually confirm that the vaccine has been properly handled during storage and transport. The last thing you want to do is inoculate someone with a vaccine that has expired or been mishandled, because they won’t develop immunity but they’ll still think they have.
There is also a brand-new sensor bar-code technology that the automatic-identification industry developed in the last year that allows you to put a sensor on a bar-code label that can be read by a cellphone app or scanner at the point of use, and automatically indicates whether or not the vaccine is within safe-usage limits.
Q: Is any vaccine manufacturing going on yet?
A: Not yet, but facilities are being prepared. My guess is that manufacturing will start around the fourth quarter. I would expect that manufacturers would then want to pre-position product in the cold chain in multiple countries while it’s awaiting regulatory approval.
Q: Does the U.S. medical supply chain have the capacity to handle hundreds of millions of doses of vaccines on top of all of the other medicines we need every day?
A: I think there are two groups that need to discuss that. One is the large pharmaceutical distributors that get the products from the manufacturers to some of the intermediaries, the Cardinals, McKessons, and so on. And the other group is the people who distribute them to the hospitals and clinics and places where people are vaccinated.
I also think that we need to turn the question around and ask: What do we have to do to ensure we have enough cold chain distribution capacity? I am not sure we have it, and I am not sure we even know to get there.
You don’t have time to build brick-and-mortar facilities. One thing we can do is leverage all the high-speed delivery services we have right now. So, rather than building a warehouse in Arkansas to store 50 million doses for that region, you could store them at an unused refrigerated DC in Massachusetts and ship them to Arkansas via overnight air. We are going to have to be creative.
Q: Most of the world’s current vaccines are manufactured in India and China. Will the U.S. have to compete with the rest of the world to get what we need?
A: Not initially. We are probably going to have two to three viable vaccines next year, which will be manufactured globally, including in places like Serum Institute of India, which services Southeast Asia and Africa. Then there are companies like Sanofi in France that basically deal with Europe and the Americas. You have American companies like Pfizer, Merck, Moderna, and the Janssen Division of Johnson & Johnson servicing the American market. So at least initially, we should not be competing with other countries.
Q: I understand we may be looking at a shortage of glass vials for the vaccines. Is that still a problem?
A: Yes, it is. We can’t just take existing vials and stoppers because they are still needed for polio and influenza vaccines. And the shortage could become particularly acute if we end up needing multiple doses to immunize people. It is definitely going to put a strain on some of the packaging suppliers—the people who make vial closures, for example. They’re going to have to ramp up their production. The same is true of companies that make containers for cold chain transport and even the syringes needed to administer the vaccine. There is a lot of stuff that will be needed other than just the vaccines themselves.
Q: There are several different vaccines being developed at the same time. Are there advantages in that?
A: Yes. There are a lot of parameters here that are more important than just being first to market. The holy grail of all vaccines is to have something that can be kept at room temperature or is not temperature-sensitive, but that is probably not going to happen, at least initially. Another thing is that a single-dose vaccine is highly preferable to a multi-dose vaccine, so if someone can produce a single-dose vaccine, it will likely displace some of the others eventually.
Q: I expect there will be some holdups and delays. Are they likely to be caused by supply chain issues?
A: I hope delays will not be due to supply chain issues. The supply chain has to anticipate that it is going to be on the “critical path” and think it through beforehand. We really have to look at nontraditional ways of distributing the vaccine to the point of care—this is going to be a global last-mile problem.
Q: The bottom-line question is when can we realistically expect a vaccine to be ready?
A: My guess is that in the fourth quarter of this year, we’ll see manufacturers start to ramp up production and pre-position product in anticipation of regulatory approval, which I expect will come in the U.S. in the early second quarter of 2021. At that point, people like Pfizer and AstraZeneca are going to be knocking on the door of logistics companies asking if they’re ready to pre-position the product because it will have to be stored somewhere until the Food and Drug Administration approves it for use.
In the meantime, I think that people in the distribution end of the supply chain ought to be looking at how quickly that vaccine, once approved, can be delivered to a clinic in Tennessee, Peru, or Bangladesh. Can that be done without building a lot of new infrastructure? We’ve learned a lot about last-mile distribution in the last five years, and I think we ought to leverage what we have already developed. Even so, I think it’s going to be really challenging and chaotic in 2021 and 2022 until we get a good chunk of the world vaccinated.
Congestion on U.S. highways is costing the trucking industry big, according to research from the American Transportation Research Institute (ATRI), released today.
The group found that traffic congestion on U.S. highways added $108.8 billion in costs to the trucking industry in 2022, a record high. The information comes from ATRI’s Cost of Congestion study, which is part of the organization’s ongoing highway performance measurement research.
Total hours of congestion fell slightly compared to 2021 due to softening freight market conditions, but the cost of operating a truck increased at a much higher rate, according to the research. As a result, the overall cost of congestion increased by 15% year-over-year—a level equivalent to more than 430,000 commercial truck drivers sitting idle for one work year and an average cost of $7,588 for every registered combination truck.
The analysis also identified metropolitan delays and related impacts, showing that the top 10 most-congested states each experienced added costs of more than $8 billion. That list was led by Texas, at $9.17 billion in added costs; California, at $8.77 billion; and Florida, $8.44 billion. Rounding out the top 10 list were New York, Georgia, New Jersey, Illinois, Pennsylvania, Louisiana, and Tennessee. Combined, the top 10 states account for more than half of the trucking industry’s congestion costs nationwide—52%, according to the research.
The metro areas with the highest congestion costs include New York City, $6.68 billion; Miami, $3.2 billion; and Chicago, $3.14 billion.
ATRI’s analysis also found that the trucking industry wasted more than 6.4 billion gallons of diesel fuel in 2022 due to congestion, resulting in additional fuel costs of $32.1 billion.
ATRI used a combination of data sources, including its truck GPS database and Operational Costs study benchmarks, to calculate the impacts of trucking delays on major U.S. roadways.
There’s a photo from 1971 that John Kent, professor of supply chain management at the University of Arkansas, likes to show. It’s of a shaggy-haired 18-year-old named Glenn Cowan grinning at three-time world table tennis champion Zhuang Zedong, while holding a silk tapestry Zhuang had just given him. Cowan was a member of the U.S. table tennis team who participated in the 1971 World Table Tennis Championships in Nagoya, Japan. Story has it that one morning, he overslept and missed his bus to the tournament and had to hitch a ride with the Chinese national team and met and connected with Zhuang.
Cowan and Zhuang’s interaction led to an invitation for the U.S. team to visit China. At the time, the two countries were just beginning to emerge from a 20-year period of decidedly frosty relations, strict travel bans, and trade restrictions. The highly publicized trip signaled a willingness on both sides to renew relations and launched the term “pingpong diplomacy.”
Kent, who is a senior fellow at the George H. W. Bush Foundation for U.S.-China Relations, believes the photograph is a good reminder that some 50-odd years ago, the economies of the United States and China were not as tightly interwoven as they are today. At the time, the Nixon administration was looking to form closer political and economic ties between the two countries in hopes of reducing chances of future conflict (and to weaken alliances among Communist countries).
The signals coming out of Washington and Beijing are now, of course, much different than they were in the early 1970s. Instead of advocating for better relations, political rhetoric focuses on the need for the U.S. to “decouple” from China. Both Republicans and Democrats have warned that the U.S. economy is too dependent on goods manufactured in China. They see this dependency as a threat to economic strength, American jobs, supply chain resiliency, and national security.
Supply chain professionals, however, know that extricating ourselves from our reliance on Chinese manufacturing is easier said than done. Many pundits push for a “China + 1” strategy, where companies diversify their manufacturing and sourcing options beyond China. But in reality, that “plus one” is often a Chinese company operating in a different country or a non-Chinese manufacturer that is still heavily dependent on material or subcomponents made in China.
This is the problem when supply chain decisions are made on a global scale without input from supply chain professionals. In an article in the Arkansas Democrat-Gazette, Kent argues that, “The discussions on supply chains mainly take place between government officials who typically bring many other competing issues and agendas to the table. Corporate entities—the individuals and companies directly impacted by supply chains—tend to be under-represented in the conversation.”
Kent is a proponent of what he calls “supply chain diplomacy,” where experts from academia and industry from the U.S. and China work collaboratively to create better, more efficient global supply chains. Take, for example, the “Peace Beans” project that Kent is involved with. This project, jointly formed by Zhejiang University and the Bush China Foundation, proposes balancing supply chains by exporting soybeans from Arkansas to tofu producers in China’s Yunnan province, and, in return, importing coffee beans grown in Yunnan to coffee roasters in Arkansas. Kent believes the operation could even use the same transportation equipment.
The benefits of working collaboratively—instead of continuing to build friction in the supply chain through tariffs and adversarial relationships—are numerous, according to Kent and his colleagues. They believe it would be much better if the two major world economies worked together on issues like global inflation, climate change, and artificial intelligence.
And such relations could play a significant role in strengthening world peace, particularly in light of ongoing tensions over Taiwan. Because, as Kent writes, “The 19th-century idea that ‘When goods don’t cross borders, soldiers will’ is as true today as ever. Perhaps more so.”
Hyster-Yale Materials Handling today announced its plans to fulfill the domestic manufacturing requirements of the Build America, Buy America (BABA) Act for certain portions of its lineup of forklift trucks and container handling equipment.
That means the Greenville, North Carolina-based company now plans to expand its existing American manufacturing with a targeted set of high-capacity models, including electric options, that align with the needs of infrastructure projects subject to BABA requirements. The company’s plans include determining the optimal production location in the United States, strategically expanding sourcing agreements to meet local material requirements, and further developing electric power options for high-capacity equipment.
As a part of the 2021 Infrastructure Investment and Jobs Act, the BABA Act aims to increase the use of American-made materials in federally funded infrastructure projects across the U.S., Hyster-Yale says. It was enacted as part of a broader effort to boost domestic manufacturing and economic growth, and mandates that federal dollars allocated to infrastructure – such as roads, bridges, ports and public transit systems – must prioritize materials produced in the USA, including critical items like steel, iron and various construction materials.
Hyster-Yale’s footprint in the U.S. is spread across 10 locations, including three manufacturing facilities.
“Our leadership is fully invested in meeting the needs of businesses that require BABA-compliant material handling solutions,” Tony Salgado, Hyster-Yale’s chief operating officer, said in a release. “We are working to partner with our key domestic suppliers, as well as identifying how best to leverage our own American manufacturing footprint to deliver a competitive solution for our customers and stakeholders. But beyond mere compliance, and in line with the many areas of our business where we are evolving to better support our customers, our commitment remains steadfast. We are dedicated to delivering industry-leading standards in design, durability and performance — qualities that have become synonymous with our brands worldwide and that our customers have come to rely on and expect.”
In a separate move, the U.S. Environmental Protection Agency (EPA) also gave its approval for the state to advance its Heavy-Duty Omnibus Rule, which is crafted to significantly reduce smog-forming nitrogen oxide (NOx) emissions from new heavy-duty, diesel-powered trucks.
Both rules are intended to deliver health benefits to California citizens affected by vehicle pollution, according to the environmental group Earthjustice. If the state gets federal approval for the final steps to become law, the rules mean that cars on the road in California will largely be zero-emissions a generation from now in the 2050s, accounting for the average vehicle lifespan of vehicles with internal combustion engine (ICE) power sold before that 2035 date.
“This might read like checking a bureaucratic box, but EPA’s approval is a critical step forward in protecting our lungs from pollution and our wallets from the expenses of combustion fuels,” Paul Cort, director of Earthjustice’s Right To Zero campaign, said in a release. “The gradual shift in car sales to zero-emissions models will cut smog and household costs while growing California’s clean energy workforce. Cutting truck pollution will help clear our skies of smog. EPA should now approve the remaining authorization requests from California to allow the state to clean its air and protect its residents.”
However, the truck drivers' industry group Owner-Operator Independent Drivers Association (OOIDA) pushed back against the federal decision allowing the Omnibus Low-NOx rule to advance. "The Omnibus Low-NOx waiver for California calls into question the policymaking process under the Biden administration's EPA. Purposefully injecting uncertainty into a $588 billion American industry is bad for our economy and makes no meaningful progress towards purported environmental goals," (OOIDA) President Todd Spencer said in a release. "EPA's credibility outside of radical environmental circles would have been better served by working with regulated industries rather than ramming through last-minute special interest favors. We look forward to working with the Trump administration's EPA in good faith towards achievable environmental outcomes.”
Editor's note:This article was revised on December 18 to add reaction from OOIDA.
A Canadian startup that provides AI-powered logistics solutions has gained $5.5 million in seed funding to support its concept of creating a digital platform for global trade, according to Toronto-based Starboard.
The round was led by Eclipse, with participation from previous backers Garuda Ventures and Everywhere Ventures. The firm says it will use its new backing to expand its engineering team in Toronto and accelerate its AI-driven product development to simplify supply chain complexities.
According to Starboard, the logistics industry is under immense pressure to adapt to the growing complexity of global trade, which has hit recent hurdles such as the strike at U.S. east and gulf coast ports. That situation calls for innovative solutions to streamline operations and reduce costs for operators.
As a potential solution, Starboard offers its flagship product, which it defines as an AI-based transportation management system (TMS) and rate management system that helps mid-sized freight forwarders operate more efficiently and win more business. More broadly, Starboard says it is building the virtual infrastructure for global trade, allowing freight companies to leverage AI and machine learning to optimize operations such as processing shipments in real time, reconciling invoices, and following up on payments.
"This investment is a pivotal step in our mission to unlock the power of AI for our customers," said Sumeet Trehan, Co-Founder and CEO of Starboard. "Global trade has long been plagued by inefficiencies that drive up costs and reduce competitiveness. Our platform is designed to empower SMB freight forwarders—the backbone of more than $20 trillion in global trade and $1 trillion in logistics spend—with the tools they need to thrive in this complex ecosystem."