Air Cargo Delivering the Modern World
The global economy relies upon air transport to deliver high quality products at competitive prices to consumers worldwide. International trade is now estimated at over USD 15 trillion and about 35% of that value is transported by air.
With the healthcare market becoming a key engine of the global economy, pharmaceutical and biomedical industries are facing new challenges in adapting to globalization. Air Cargo is an essential link in the consumer supply chain ensuring continual access to quality and choice but it cannot work on its own.
The International Air Transport Association (IATA) is the industry’s global trade association and represents some 240 airlines comprising 84% of global air traffic. Its mission is to represent, lead and serve the air transport industry. In Cargo, IATA takes a supply chain approach to all its initiatives, with an aim to benefit all parties (airlines, forwarders, governments, Customs and shippers). IATA delivers standards and solutions to ensure a safe and harmonized air transport system. IATA’s vision for cargo is to foster a safe, secure, reliable, efficient and profitable air cargo supply chain. Specialist drugs, vaccines and emergency aid rely on air Cargo to get where they are needed.
The market for healthcare products continues to grow and shows strong resilience to global economic downturns. An increasingly aging population requires access to new products and spending on national healthcare programs is an important part of many government social policies. The emergence and expansion of Brazil, Russia, India, China and South Africa as major consumer markets will shift demand and lead to more balanced trade flows in the air cargo industry. This is already seen in China and to an extent in India. The growing middle classes in emerging economies are discerning high end consumers who will continue to sustain air freight growth in the years to come. Understanding customer needs, anticipating them and adding value in delivery is key to achieve an effective supply chain. This was undertaken by the collaborative actions taken by IATA and their supply chain stakeholders and partners with the aim to address the concern of the healthcare industry to ensure the integrity of the sensitive healthcare products is preserved and maintained when transported by air.
Today this growing market has brought its challenges, a heavily regulated industry with countries specific requirements and transportation of pharmaceuticals is just one of those challenges. There has been a transition from single manufacturing sites to global manufacturing, which now could require a drug product to be processed in multiple steps at multiple sites located in multiple countries around the world. The healthcare industry increasingly relies on globally-based production as large pharmaceutical companies outsource manufacturing and patent expiry creates generic drug demand. The change in demographics and longevity of the population and the greater accessibility and wider choice of drug products leads to continued demand for healthcare products.
Speed to market is therefore essential and the healthcare industry is increasingly dependent upon air cargo. Addressing the challenges of keeping products at the correct temperature range to ensure the quality of the product is not affected in transit is key. Temperature control in transport is therefore an important component of the industry and is continuously rising in line with international trade. The most important issue for the industry and its logistic providers is to clarify mutual expectations to minimize risks and challenges for airfreight within the cool chain. Temperature deviations and temperature excursions throughout the journey requires the establishment of a complete logistical process to maintain the shipment integrity. Quality, reliability and performance are crucial, therefore dialogue, joint strategy and standardization throughout the complete supply chain is needed. Though the shipper is ultimately responsible to ensure the product and any necessary packaging is preconditioned to the required temperature and will remain within a temperature range for a certain period of time - using the appropriate refrigeration method adapted to the shipping circumstances and the accountability is shared by all of the stakeholders within the healthcare supply chain. Meeting the challenges can only be achieved by cooperation between all stakeholders involved in the supply chain, who recognized the need for guidelines.
To address the challenges in transporting healthcare products, IATA established a dedicated working group, the IATA Time and Temperature Task Force (TTTF) under the supervision of the IATA Live Animals and Perishables Board, a governance body comprised of 12 Airline members, endorsing healthcare standards for the air cargo industry recommended by the Time and Temperature Task Force members. The work undertaken by this healthcare industry subject matter expert Task Force composed of airlines, ground handling agents, freight forwarders, shippers, international or national organizations, airports and equipment manufacturers led to the inclusion of a specific chapter in the existing IATA Perishable Cargo Regulations (PCR). Today the air cargo industry is using the IATA PCR as the essential reference guide for all parties involved in the packaging, handling and distribution by air of time & temperature sensitive healthcare products. Chapter 17 “Air Transport Logistics for Time and Temperature Sensitive Healthcare Products” in the PCR specifically addresses the temperature control management issues identified by the industry.
Currently the transport of Time and Temperature Sensitive Healthcare Products is an activity within the air cargo industry that needs much greater increase in profile amongst top executive key decision makers. Associated risks, e.g. loss of integrity of the product, the damage to the shipments, can generate substantial costs for the industry stakeholders. As long as the processes within the supply chain are being dealt in a separate way between the stakeholders involved, the current issues are likely to continue.
Therefore, with years of operating experience, airlines have developed very effective handling techniques for chilled and frozen products, providing shippers with optimum, cost-efficient packaging methods for these time and temperature sensitive commodities, but airlines needed to address the issues related to the cold chain for transport of time and temperature sensitive healthcare products. As a result, the Perishable Cargo Regulations Chapter 17 provides the requirements for the transportation of time and temperature sensitive healthcare cargo shipments, with regards to training, quality management systems and also sets out recommended standards such as the use of the IATA Time and Temperature Sensitive label, developed together with the air cargo supply chain, and fi rst introduced on July 1, 2010.
Mandatory Shipping Label
The Time and Temperature Sensitive label came about as a result of standardizing the nearly endless parade of labels applied by shippers throughout the industry. It is a shipment label, specific to the healthcare industry that must be affixed to shipments transported as time and temperature sensitive cargo. Regarded as a recommendation, the air cargo industry recognizes this label as a best practice. Therefore, effective July 1st, 2012 the IATA Time and Temperature Sensitive label will become mandatory for the transportation of healthcare cargo shipments transported as temperature sensitive cargo. The decision to implement this step resulted from a collective recommendation supported by the Time and Temperature Task Force and Working Group members and endorsed by the IATA Live Animals and Perishables Board.
IATA’s aim is to ensure the integrity of the time and temperature sensitive healthcare cargo shipments and that the air cargo supply chain is prepared to handle the demands of these healthcare shipments. The application of this new requirement will enhance the transport and handling of such specific healthcare commodities with the aim to ensure patients safety through effective cold chain distribution. Therefore, it is imperative that airlines, ground handling agents and other stakeholders in the supply chain – including freight forwarders, terminal operators, ULD manufacturers, packaging and tracking and tracing companies – are familiar both with the regulations and the appearance of the label.
The PCR Chapter 17 requirement mandates to indicate on the lower half of the label the external transportation temperature range of the shipment. The responsibility to apply and complete the label for time and temperature sensitive healthcare cargo shipments booked as such rests with the shipper (or designated shipper’s agent by service agreement). Though transportation begins with the shipper, IATA together with its members are putting an emphasis on the initial booking, which is the key step to successful cargo transportation and, which triggers the specific and/or appropriate handling and operational processes associated to healthcare transport and/or logistics. The label only supports the booking, thus the transportation temperature range specified on the label must match the transportation temperature range stated on the Air Waybill, Service Level Agreement (SLA) or Standard Operating Procedures (SOP).
In addition to the label, IATA is working on a number of other projects to help tackle difficulties in pharmaceutical transportation. To strengthen the overall supply chain a 24-hour contact telephone number(s) of a person knowledgeable about the shipment will have to be provided at the time of booking on the Air Waybill as well as in the SLA or SOP, to allow contacting the appropriate person in the event of a significant delay or disruption to the shipment that may impact on the viability of the contents of the shipment.
More information can be accessed on the IATA website using the following link: http://www.iata.org/perishables
Implementation of a Quality Management Systems Approach
The Perishable Cargo Regulation defines the required elements of a Quality Management Systems when involved in the distribution of temperature sensitive healthcare products including but not limited to Quality Management Systems structure and management responsibilities. It is important and necessary that each segment of the healthcare supply chain understand their roles and responsibilities and that of their upstream and downstream supply chain partners. The information in the Regulation allows readers to understand the use of having contractual agreements between parties on how the process should be handled and temperature-mapping recommendations in order to demonstrate suitable storing conditions. Furthermore, by monitoring temperatures the supply chain also becomes more secure (a non-negligible benefit to shippers) and when integrated with standard processes, then total quality is attained.
Supply chain excellence is achieved as a result of applying fundamental principles that answer customer’s needs. Training therefore becomes paramount. Training of staff handling sensitive cargo is crucial to ensure the integrity of the cold chain is maintained. For the stakeholders involved in Time and Temperature Management, it is a prerequisite for the implementation of the PCR and the air transport logistics of healthcare products. The success of a program like Chapter 17 is based on how well it is implemented. It is essential that each member of the supply chain understands what their specific requirements for compliance are, as well as those of others in the supply chain. This allows for greater understanding of the entire supply chain process and smooth integration. As a result, the IATA Training and Development Institute leads training in time and temperature sensitive cargo handling to ensure compliance with the Perishable Cargo Regulation Chapter 17.
Generalizing Auditing Procedures
Speaking of auditing, healthcare companies are often mandated by regulators to audit their supply chain providers. IATA’s concern is that numerous auditing of airline members by pharmaceutical companies and freight forwarders make it difficult for them to go about their day-to-day business. The lack of a common audit format that would minimize the disruptions caused by frequent audits and increase their effectiveness is an area in which IATA will put its effort with the intention of investigating potential standard auditing practices that all parties involved could agree on, i.e. when an airline is audited by one healthcare company it could be recognized by others.
IATA is as well focusing on describing the end-to-end business process flow for transport of time and temperature sensitive healthcare products between the stakeholders of the supply chain. This task undertaken together with the working group will allow the identification of minimum requirements that could be set as standard procedures that will need to be followed by the industry. This exercise is being defined in a roadmap to ensure that by 2012-2013 IATA with the support from the industry will enhance the Time and Temperature Sensitive Cargo environment. It involves reviewing all the relevant key performance indicators, procedures, standards, recommendations, specifications and training material relating to Time and Temperature Sensitive Cargo to ensure that they are relevant, aligned, current and consistent. IATA is working with the industry therefore such an initiative is carried out in cooperation with the appropriate cold chain stakeholders in the healthcare industry. This is only the start and will be followed by continuous development of standards setting to perpetuate IATA’s vision to be the force for value creation and innovation driving a safe, secure and sustainable air transport industry that connects and enriches our world.
Mrs. Andrea Gruber joined the International Air Transport Association (IATA) as Manager Business Process & Standards in the Cargo Division and is responsible for delivering the standards and processes for the air cargo supply chain. Mrs. Gruber is responsible for the IATA regulations related to the transport of Live Animals, Perishables and Healthcare Cargo. She is secretary to the IATA Live Animals and Perishables Board and the Time and Temperature Task Force. Prior to work with IATA, Mrs. Gruber worked at the International Road Transport Union (IRU) as head of a division implementing, at the Customs and business level, tools to assist the application of risk management. Mrs. Gruber studies in Geneva at the University and at the Graduate Institute of International Studies (I.U.H.E.I. and holds a Master of Sciences in International Relations.