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U.S. Covid shot distribution faces new challenges in year two, UPS vaccine logistics head says

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The next phase of the U.S. Covid vaccination distribution effort will be challenging, the president of UPS Healthcare told CNBC, as Tuesday marks one year since the initial shipments.

“The manufacturers are starting to think about how they change the formulation,” said Wes Wheeler, who leads the vaccine logistics effort for the global carrier. “When that happens, inventory becomes an issue, logistics becomes an issue and basically performance becomes an issue.”

UPS and FedEx are the U.S. government partners in Covid vaccine distribution, which began under what was originally called “Operation Warp Speed” in the Trump administration.

Over the past 12 months, the carriers have delivered more than 594 million doses of the Pfizer, Moderna and Johnson & Johnson vaccines domestically, with a 99% on-time delivery rate.

A minimum of 115 million more vaccines will have to be distributed in order to reach a goal of 70% of Americans being fully vaccinated and boosted, according to a CNBC analysis of Centers for Disease Control and Prevention data. About 27% of fully vaccinated Americans have received a booster dose as of Dec. 13, according to the CDC.

“The key is flow, it’s all about flow,” now-retired U.S. Army Gen. Gustave Perna told CNBC, referring to how to sustain the vaccine rollout. Perna was chief operating officer of Operation Warp Speed and continued to serve under the Biden administration before retiring in July.

“Vaccine is available, and it will be distributed when it’s ordered. The key is just to order what you need when you need it and it will be there. If somebody tries to hoard vaccine, bring it too much for ‘just in case,’ that’s when there is going to be problems because you might be taking away from other places where it’s needed and you might not use as much as you thought. So, you want flow,” Perna said.

Wheeler agrees that “flow” is a key, saying the differences between state vaccination, distribution and storage plans could also create logistics issues after delivery. “There will be potentially more vaccines that have to be returned or destroyed because they are not used and they are kept in storage beyond their shelf life. I think that is the next phase for us, to handle that as well as we can.”

Wheeler said the international vaccine effort is also a top priority, especially in Africa where less than 10% of the population is fully vaccinated. UPS is supporting drone vaccine delivery by start-up Zipline in Ghana and other nations. “We are trying to get to the rest of the world,” Wheeler said. “We have a long way to go. We are here to help, and we want to do more,” he added.

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