Senate Commerce Hearing on COVID-19 Vaccine Transportation Transcript December 10

Mrs. Fischer: (00:40)
… Pandemic over 280,000 of our family members, friends and fellow citizens have died from COVID-19. Many more have had the disease, and in some cases with severe symptoms and potential long-term impacts. Even more have felt the economic impacts either through losing a job, facing shorter work hours or being forced to close businesses. And all of us have adjusted to what we modestly call a new normal, which has kept us apart from family, friends, and colleagues. It’s kept us from celebrating holidays together, engaging in our favorite pastimes and enjoying each other’s company in person.

So when we all heard news that vaccines may soon be available, we could be both impressed with the science and the hard work that went into developing them and relieved that we may be nearing the beginning of the end to this pandemic. We must all remember that until vaccines are widely available, and people are vaccinated, we need to continue to wear masks, social distance and wash our hands. Once the vaccines are vetted and approved, we will again rely on the transportation sector as we have throughout this year to complete what has been one of the biggest logistics challenges in recent history.

Today, we have an opportunity to hear about the ongoing preparation to ensure the quick, safe, and efficient transportation of a vaccine to its destination from the manufacturer to state designated providers. First, I wanted to thank the administration. Operation Warp Speed, participating agencies, scientists, and vaccine manufacturers for all of their dedication and ingenuity to getting us where we are today. We must also remember all of the frontline workers who have given so much in this past year.

The CDC says its goal is for everyone who wants to get a vaccine to be able to get one as soon as possible, HHS and DOD as part of Operation Warp Speed aims to procure and assemble enough supply kits to support administering 60 million vaccine doses. UPS and FedEx will play a critical role in ensuring these vaccines are delivered to providers identified by the States. States will then ensure the vaccine is either administered or redistributed as necessary.

Each of the witnesses here today will provide insight into the planning that has already gone into transporting and distributing a vaccine, the anticipated challenges and what Congress and the public should expect from this process. One of the more notable challenges will be maintaining the cold chain, meaning that the vaccine does not experience a warmer temperature during transportation.

Speaker 1: (03:57)
… Vaccine would be contingent upon the ability to conduct further vaccine evaluation, which would occur through a combination of active follow-up of vaccine recipients under the EUA, passive monitoring for clinically significant adverse reactions using established reporting mechanisms for example, the Vaccine Adverse Events Reporting System, observational studies including those that leverage healthcare claims databases, and finally continuation of blinded placebo controlled follow-up in ongoing clinical trials for as long as it’s feasible, and strategies to handle loss of follow-up in those trials.

Speaker 1: (04:40)
We acknowledge that placebo controlled blinded followup cannot continue indefinitely as more information about the vaccine safety and effectiveness becomes available. However, FDA does not consider issuance of an EUA for a COVID-19 vaccine to necessitate immediate unblinding of ongoing clinical trials, or offering vaccine to all placebo recipients. Of course, trial participants may choose to withdraw from followup for any reason, including to receive vaccine made available under EUA. And it may be possible to offer vaccine to placebo recipients in clinical trials in a reasonable timeframe that doesn’t compromise the integrity of the clinical trial. And these considerations will be discussed further this morning

Tammy Duckworth: (06:02)
To our witnesses, thank you for your participation today. Unfortunately, millions of our friends and neighbors are grieving the loss of a family member or loved one this holiday season. This tragedy has been repeatedly exacerbated by President Trump’s refusal to take this pandemic seriously. To say that I am disappointed with the president’s coronavirus response is a depressing understatement of epic proportions.

From the onset of COVID-19, the president has renounced his responsibilities and abandoned logic, stability, and expert advice while prioritizing self-promotion and blame shifting. But for the hard work of many dedicated career public servants, health officials, and frontline workers, COVID 19 may very well have stolen twice as many American lives that the more than 290,000 souls who have already perished.

If committee staff could please bring up the graphics. In October, the president, once again, dismissed the pandemic as a media hoax by suggesting that after election day, and if you look at this graphic, I quote, we won’t be hearing much about it anymore. Well, Mr. President, since election day and additional 55,000 Americans have died and COVID-19 and infections and hospitalizations have spiked to record highs across this nation.

In the past week and a half, the president has held potential super spreader holiday parties at the White House despite the advice of his own health experts he’s held a self-congratulatory vaccine summit and issued an executive order so meaningless that he did not even bother to inform the top scientists for Operation Warp Speed.

As is often the case with this administration, others must plan, others must prepare, and others must implement in the absence of presidential leadership. Fortunately, industry appears competent, particularly FedEx and UPS that they already operate a massive logistics network capable of distributing all types of vaccines nationwide. Perhaps most importantly, the shippers testifying before us today appear to be confident that their respective network of freezers that already exist for transporting perishables, medical goods and supplies will be up to the task of safely shipping vaccines.

Of course, this subcommittee does not exist to simply accept confident predictions at face value. After all in 2020, it is prudent to prepare for and expect things to go terribly wrong or accordingly, I hope today we will learn more about what evidence underlies the competence of our witnesses. Have shippers stress tested their capacity to handle the massive holiday shipping boom and the distribution of a life saving vaccine or multiple vaccines with different storage requirements, for example? Have companies taken the steps to proactively secure supplies like dry ice in anticipation of shortages resulting from a spike in global demand? While the president has undermined American scientists, public health experts and logistics professionals at every turn, our longstanding history of public private partnerships and developing medical countermeasures has enabled us to develop vaccines in record time. Until the Oval Office returns next month to patient and practiced hands, our nation is depending on the private sector and state and local governments to execute what may be one of the most complex logistical challenges our country has ever faced.

This won’t be easy. Our country has lost significant ground. However, I am cautiously optimistic about the outcome because of actions taken thus far by many public and private sector stakeholders to develop and implement a strategic roadmap needed to ensure the safe, efficient, and equitable distribution of vaccines to Americans as quickly as possible.

Again, thank you to our witnesses for participating. Thank you Madam Chair for holding today’s hearing, I’m going to be turning off my camera because as you can see, I am at home. I am doing my daughter’s distance education, and it’s a little crazy here and nobody needs to see this, but thank you everyone. And I look forward to today’s hearing.

Thank you, Senator Duckworth. It has been a pleasure to work with you on the issues that we agree with each other on, and it is always a joy to be able to work out differences so that we can pass good legislation for the people in this country. Senator. Next I would like to recognize Senator Roger Wicker, Chairman Wicker, you’re recognized for an opening statement. I believe you are also at a remote location.

Roger Wicker: (10:43)
Right. I’m at a remote location in the Dirksen Building. Can you hear me, Madam Chair?

I can. I see you’re in your office Sir, good to see you.

Okay. And my office does not compare to Senator Duckworth’s kitchen. Her location is much neater and tidier than my desk, but here we are. And thank you Senator Fischer for your leadership and holding this hearing. I just checked, we just hit over 290,000 deaths in the United States because of the COVID 19 pandemic, and it’s tragic in every way, but really today is a day of good news. I anticipate the FDA will give approval today to one of the vaccines, I certainly hope so.

And also it’s just a time to celebrate the great success of Operation Warp Speed. It’s a breathtaking how our scientists have really exceeded expectations and perform miracles, and here we are where vaccines are now being given globally and will soon be given to the United States. So there’s good news amidst the tragedy. Today’s hearing will inform the committee about the logistics of distributing the vaccines across the country. And these newly developed vaccines were produced at record pace because of Operation Warp Speed, a public private partnership devised by the Trump administration. There’s just no way around that.

And Congress passed legislation to invest in this that’s been bi-partisan and it makes me feel good as an American and as a member of the United States Senate and a member of this committee. Efforts to ship and deliver vaccines will begin immediately once the FDA issues emergency authorization, so we’ll be looking for news today. Our nation’s transportation network has been critical in helping sustain our economy during this pandemic, and it will be just as critical in enabling us to defeat the virus in the months ahead.

I know there’s much left to do, we are turning the corner and as we turn the page on a new year, I think things are really looking up and thank goodness for that. I look forward to hearing today from my witnesses about their roles in ensuring the vaccines are distributed safely and efficiently. We’ll be asking about adequate communication between federal state and local officials, vaccines with the rest of what we’re looking for, and then we’ll be wanting to hear from witnesses about any cyber threats that we might have. So thank you very much. Glad to be part of this. Thank you much to our witnesses and I’ll yield back to you Madam Chair.

Thank you Chairman Wicker. Next, I would like to introduce our witnesses for their opening statements. Let’s begin with Dr. Rachel Levine, secretary of health for the Commonwealth of Pennsylvania. Dr. Levine is also here today as president of the Association of State and Territorial Health Officials. Welcome Dr. Levine.

Dr. Levine: (14:32)
Well, good morning. Thank you very much. And so I would like to thank chairman and Senator Wicker, ranking member Senator Cantwell, subcommittee chair, Senator Fischer, subcommittee member Senator Duckworth, and all of the distinguished members of the Senate, commerce, science and transportation committee for the opportunity to appear before you to discuss the challenges facing states like Pennsylvania due to the COVID 19 pandemic. As you kindly stated, my name is Dr. Rachel Levine. I’m the secretary of health for the Commonwealth of Pennsylvania, and I am currently the president of the Association of State and Territorial Health Officials.

Dr. Levine: (15:12)
I joined the Wolf administration in January 2015 after approximately 20 years at the Penn State Hershey Medical Center and Penn State College of Medicine. As the physician general of the Commonwealth, I was named acting secretary in July of 2017, and then confirmed in 2018. During this time, public health preparedness has always been one of my absolute priorities. And what I would always say is the thing that would keep me up at night would be the risk of a global pandemic or what the CDC has called disease X. And unfortunately, that has come to pass.

Dr. Levine: (15:49)
From a public health perspective, there are three ways to address a pandemic such as COVID-19. You can work on containment, which includes testing and contact tracing with appropriate isolation and quarantine. You can work on mitigation, such as wearing a mask, washing your hands, social distancing, avoiding large and small gatherings and other necessary mitigation factors that have been implemented by States. And then there is a vaccination. We continue to apply containment mitigation measures to control the spread of COVID-19, and we have seen success and we have seen challenges. But as has been mentioned, the only way to truly end this pandemic is through widespread vaccination, and this will be our biggest challenge yet.

Dr. Levine: (16:41)
As it’s been stated, there are two vaccines currently that we anticipate will be available in the next several weeks, the Pfizer vaccine and the maternal vaccine. And I also applaud the success of Operation Warp Speed in terms of the development of these vaccines. These are two vaccines based on novel technology using genetic material called messenger RNA to induce an immune response, it’s never been done before, it’s really a tremendous achievement.

Dr. Levine: (17:10)
Each vaccine needs different methods of containment, transportation, and distribution. In Pennsylvania, we have collaborated with public health officials from across the country to solve these logistical challenges. However, the challenges of this essential mission do go beyond getting the vaccine from point A to point B. We are facing challenges in coordination and in communication in such a massive mission between federal, state and local health agencies.

Dr. Levine: (17:41)
We are facing challenges, and I must say that that States had little or no involvement in any key policy decisions or discussions. We’re facing challenges in terms of the development of a coordinated communication strategy to promote confidence in the public and the safety, and efficacy of the COVID-19 vaccines, and to be able to counter vaccine hesitancy.

Dr. Levine: (18:05)
And finally, we are facing challenges in finding sufficient funding to execute a timely, comprehensive and equitable vaccine campaign over the long haul. But despite this, we are confident in our ability to carry out this mission because running vaccination programs is really fundamental to our work in public health. We do have experience in vaccinations, and we have detailed plans to meet the challenge of this historic moment. But I emphasize this will not be a short-term operation. In the $300 million allocated to states’ territories and big cities is simply insufficient.

Dr. Levine: (18:44)
We break it down, there are about 330 million people in the United States. So that’s a little over a dollar per person in the United States to mount an immunization enterprise that’s unparalleled in scale and publication, and it is insufficient. The Association of State and Territorial Health Officials, which I am president has partnered with the Association for Immunization Managers, and we are requesting that Congress provide $8.4 billion in emergency supplemental funding for this ongoing mass vaccination campaign.

Dr. Levine: (19:16)
That will include funding for workforce, for infrastructure, for outreach to priority populations, communications, and educational efforts to increase vaccine confidence and combat misinformation. At the Pennsylvania department of health, our vision is a healthy Pennsylvania for all, and we are laser-focused in moving towards that mission and ensuring all people have access to the COVID-19 vaccines.

Dr. Levine: (19:42)
I am so proud of the immense public health work we have done in Pennsylvania and across the country that has worked to slow the spread of this virus and save lives. But one thing this pandemic has reinforced is the need for continued investments in public health, and place a spotlight on the need for additional funding to support our efforts to vaccinate the entire country to bring this pandemic under control. Thank you so much for the opportunity to offer this testimony and for all of your partnership, and I’m pleased to answer any questions.

Thank you, Dr. Levine. Next, I would like to introduce Richard Smith. Mr. Smith is the regional president of the Americas and executive vice president of Global Support for FedEx Express. In this role, he oversees operations in the United States domestic market, Canada, Latin America, and the Caribbean. Welcome.

Richard Smith: (20:36)
Thank you. Chairman Fischer, ranking member, Duckworth and members of the committee, thank you for inviting me representing FedEx and UPS here today to speak about our efforts, to support the upcoming distribution of vaccines to combat the spread of COVID-19. We recognize that this is complex and critical work and appreciate the subcommittee’s focus on this mission. Before I begin, I would like to express my sincere appreciation for the courageous work of our more than 600,000 FedEx global team members who have been on the front lines since the start of this pandemic providing essential transportation services and keeping critical supply chains moving.

As a result of their dedication and commitment to the communities we serve, we have delivered over two billion face and surgical masks, 55 kilotons of personal protective equipment, and over 9,600 discrete humanitarian aid shipments to support the global response to COVID-19 to date. Earlier this year when the pandemic reached the United States, we work quickly to support over 40 community testing sites spanning across 10 States delivering test kits and samples for analysis.

I’m very proud of the significant positive impact that FedEx team’s work has had on the response to this pandemic, and we’ll continue to have as we enter this next critical phase. I’m grateful for and humbled by their continued unrelenting commitment to service, which we refer to at FedEx is delivering the purple promise.

47 years ago, FedEx was created for the exact purpose and service required for today’s mission. Fast, reliable delivery of time sensitive, high priority goods. As the largest global express transportation provider, FedEx has an unparalleled worldwide network serving over 220 countries and territories connecting more than 99% of the world’s gross domestic product. Within the United States, we can deliver to every zip code. With the largest fleet of cargo airplanes, over 670, and over 180,000 motorized ground vehicles, we deliver more than 17 million packages on an average day.

Every day at FedEx, we focus on what we can control and prepare for the things we cannot. We invest in our team members and innovative technologies all in preparation to serve the needs of our customers and communities. FedEx has a long history of supporting critical relief efforts around the world, and we are ready for the challenge ahead. For the past several months, we’ve been working closely with our healthcare customers both the vaccine manufacturers and distributors, as well as the federal government on vaccine distribution plans. We have years of experience in this area, shipping flu vaccines every flu season, and moving vaccines globally for decades, as well as transporting over 80 million vaccine doses to combat H1N1 in 2009.

We also regularly carry vaccines for commercial and government organizations, both domestic and international. Our healthcare team has been able to leverage this experience, flex our comprehensive network and work with various stakeholders to build customized solutions to achieve our collective goal. Moving COVID-19 vaccine shipments as safely, securely, and quickly as possible. This is who we are and what we do.

Once the vaccines are approved and ready for distribution, vaccine and related healthcare shipments will be the top priority for FedEx Expresses Network. Our priority alert team will actively monitor and track vaccine shipments for our healthcare customers using a suite of advanced tracking and monitoring tools, including sensor ID, which uses FedEx patented technology, as well as our FedEx around platform, providing predictive analytics.

These technologies provide increased visibility in real-time updates on sensitive packages, enabling us to intervene and intercept the shipment if necessary. Long ago, we recognized that information about the package was just as important as the package itself. We invested in these innovative solutions for this exact purpose. We have also made significant investments in our cold chain infrastructure over the years, including our packaging aircraft, motorized vehicles and facilities. At present, we have more than 90 temp control facilities across five continents with plans to open additional facilities in the coming years. We are also expanding our network of ultra low temperature freezers at some of our major hubs, as demonstrated by these actions, we have planned for the various contingencies required for missions like this and are prepared to respond as needed.

Finally, maintaining the health and safety of our central frontline workers will remain our top priority throughout this effort. To date, we have spent over 225 million in personal protective equipment and cleaning services to keep our employees safe. We will continue to invest in our employee health, safety and monitoring programs, providing safety equipment, regularly cleaning our facilities and ensuring that our employees have access to COVID-19 testing. Their health and fitness are vital to this effort.

From day one of our operation, FedEx has taken the necessary steps and is well positioned to respond both here and abroad. This concludes my statement, I appreciate your time today and look forward to answering any questions you may have.

Thank you, Mr. Smith. Next I’d like to introduce Wesley Wheeler. Mr. Wheeler is the president of Global Healthcare at UPS. In this role, he oversees UPS’s work related to pharmaceuticals and medical device transportation, wholesalers, retail distributors, and customers of regulated healthcare products. Welcome, sir.

Wesley Wheeler: (25:52)
Good morning Chairman Fischer, ranking member Duckworth and members of the subcommittee. My name is Wes Wheeler, I’m the president of UPS Healthcare, the company’s healthcare and life sciences division. Thank you for the-

Mr. Wheeler: (26:03)
Healthcare, the company’s healthcare and life sciences division. Thank you for the opportunity to appear for you this morning and discuss our involvement in COVID-19. I’ll focus my testimony today on our capabilities, our involvement in Operation Warp Speed, and the solutions we are implementing to ensure the safe and effective delivery of vaccines upon approval. I trust that my testimony tonight will clarify our involvement and I look forward to your responses and questions. While the UPS is known primarily for its brown trucks and drivers, members of the subcommittee may not be aware that UPS is also a longstanding provider of supply chain services for the many healthcare companies around the world. We handle medicines in more than 10 million square feet of facilities in more than 30 countries. Our regulated facilities are designed to handle biologically-derived drugs, such as vaccines at any temperature.

We also offer end-to-end cold chain transportation service by air, ground, or ocean, and we deliver on average more than 25 million packages per day. UPS has been on the front lines of COVID-19, as FedEx has, since February of this year. We supported FEMA and Project Airbridge by moving more than 24 million pounds of PPE and opened up our facilities to the National Strategic Stockpile Program. We also supported 32 states by distributing millions of diagnostic test kits and biologic samples for COVID-19. We’re also involved in clinical trials. Our UPS healthcare group was proud to be the logistics partner for the Pfizer COVID-19 vaccine clinical trial. In fact, we are providing logistics support for eight of the 10 leading vaccines in clinical trials today. Our experience with these trials helps us to prepare for vaccines when they come to market.

UPS is a proud partner of Operation Warp Speed, and we were delighted to present at the vaccines summit this week for the president, and we are in daily contact at all levels with the team and just last week, General Perna and Dr. Slaoui visited one of our newest healthcare facilities in Louisville, Kentucky. We reviewed our supply chain planning and the preparations we have in place. We discussed how we will handle ultra-low temperature shipments and, in particular, how our dry ice replenishment program will be managed. I believe they left feeling confident with our degree of readiness. Let me elaborate further on the transportation security and temperature issues, which I believe the subcommittee is interested in. Please understand that UPS has spent many weeks designing the supply routes and expected data flows for these vaccines. Capacity has been reserved in our air network, our operating hubs, and our ground operations. Our 3000 US-based pilots will know they are carrying vaccines.

Our trailers will have escorts. We will monitor all vaccine shipments in a newly dedicated 24/7 command center, which collects data from all sources, including GPS and temperature monitors. Each package will also carry a UPS exclusive active tag, which provides visibility in our network. Command center staff have been trained to monitor and, if required, intervene and recover a vaccine package. UPS has also designed software, which can detect network disruptions before they occur. On the issue of temperature control, UPS has extensive experience handling shipments at any temperature. However, it is important to note that in the case of these vaccines, the temperature in transit will be maintained by its packaging, which is designed to keep its internal temperature at temperature for several days. Pfizer and McKesson have chosen appropriate, validated, and environmentally-friendly packaging for these two vaccines and we have extensively tested both. UPS has also invested in dry ice manufacturing capacity for replenishment at dosing sites where required. UPS will produce over 24,000 pounds of dry ice per day in Louisville, and we will ship 40 pounds of dry ice to all Pfizer dosing locations one day after the vaccine arrives.

UPS is also nearing completion of two very large coolers and freezers in the same facility for storage of future vaccines in the pipeline, and we offer a program to supply ultra-low temperature freezers for dosing sites where dry ice may not be available. We are ready. I’d like to take a moment to thank the thousands of UPSers who are poised and ready to deliver the greatest contribution to this country we could possibly imagine. Together with General Perna and our colleagues at Operation Warp Speed, none of this would be possible. Thank you very much, Chairman Fischer. I’ll take your questions.

Thank you, Mr. Wheeler, and thank you to all of our panel. I’d like to begin the first round of questions. Mr. Wheeler and Mr. Smith, as you know, we are in the midst of peak shipping season when transport capacity is expected to be tight. At the same time, tens of millions of vaccine doses are likely to be available today. Once vaccines are approved will UPS and FedEx ensure capacity is available in your network for COVID-19 vaccines and, if so, how will you ensure that capacity is available? Mr. Smith?

Well, we began planning for peak in January of that year so we recognized early on this would be a record peak season and, of course, throughout the months as the COVID picture changed, and we saw all of the folks ordering things at home and the volume spike, we adjust our plans accordingly. So, we’ve even taken to calling this peak, the shipathon months ago because we knew it was going to be a record peak. But just as my esteemed competitor here said about their network, we also knew the vaccines would be coming when we started planning for this with Operation Warp Speed and our healthcare customers, the manufacturers, and distributors who would play a role in this.

So, we started reserving capacity for that. We’ve been preparing for months working with all of our customers, as I said, to match network capacity with the demand we expect to see just as we do for any surge event, whether it’s peak season, a new iPhone release, or any new product introduction, we’ve been planning for this for some time. We’ve also hired 70,000 more team members across the FedEx enterprise to support all of our needs this season. Again, as I said before, this is who we are and what we do. This is what we were built for, and we plan for things like this regularly. Maybe not on this scale with all of the ins and outs, but we are well-versed in this type of planning.

Also, I’ll point out for FedEx, we have different operating companies that focus on different things. You may note that you’ll see a FedEx Ground truck on the road, and sometimes you’ll see a FedEx Express truck. The FedEx Ground system, which we’ve been investing in tremendously, will handle the bulk of the surging online retail orders, all of your Christmas presents, and the express network focuses more on time-definite critical deliveries like vaccines. That is the company that will be focused on delivering your mission-critical vaccines. Thank you.

Mr. Wheeler?

Thank you. I’m an engineer. About two or three months ago, we started building a forecasting model trying to predict as best we could how many vaccine companies would be approved this year and next year, where the manufacturing locations were. So, we had the origins. We started to think about how many doses per shipment and we built a very detailed forecasting model, which would allow us to predict how much we would be having to reserve in our capacity. During peak, of course, we’re now above our 25 million per day. We’re at 34 million I think a couple of days ago.

We have reserved plenty of capacity in all the lanes from all the manufacturing locations, even for the vaccines that are still in development. So, we’ve talked to all the companies, including Novavax, AstraZeneca, J & J, to find out just how much volume may come through the pipeline at the first of the year or beyond. So, we have reserved plenty of capacity in all the lanes. We’re ready now. We have the dry ice capacity to start with a large number of Pfizer vaccine shipments starting next week we hope, and we’re very much looking forward to that.

So, if I’m understanding you both correctly, you knew this was going to be a peak season anyway, and now you put COVID on top of it and the challenges that we face there just in our daily lives with people becoming ill and having to have time off and having those people replaced. So, you hire more people, you use different delivery systems, whether it’s for regular shipping compared to the shipping we’re going to see now with the vaccines. Do foresee a need that the vaccines are going to have to become a priority? Because if the development of them increases at a higher capacity, at a faster capacity, have you planned for that? And then, how do you plan to get that out? Do you plan to follow a model of hiring more people, getting the resources you need, whether it’s finding other shipping companies, air freight, and then the freezing capacity and getting it delivered throughout the United States?

Well, we’ve said throughout this that there will be no higher priority shipments in our network than these vaccine shipments. So, they will have the highest priority of anything we carry in all of our FedEx networks, but certainly in the FedEx express system that’ll be carrying them. We’ll be using new technologies and I’m sure someone will get to a question on that, so I won’t go into too much detail about our respective monitoring and tracking technologies that will allow us to have positive control of these shipments at all times, know where they are, give them that highest priority in our network, and make sure they’re delivered, intercede if there’s any unforeseen delays, weather-related, on-road traffic delays, we’ll have eyes on them. We’ll be able to jump into action, but make-

I’m going to interrupt you. Do you have a good working relationship with airports, for example?

Absolutely.

That you will move into priority lanes there? Do you transport by rail, trucking?

These shipments will move in our integrated air-ground system, the express network, but we’re working closely with the FAA and we have great relationships with the airports, but we’re working with the FAA to identify the flights that will have these shipments so they will get the highest priority. To your question on staffing, as I said, we staff up just like UPS does for peak. We hire a lot of new team members during peak. We know that as these vaccines come on and ramp-up, we will continue operating at elevated levels post-peak, but we’re confident we have the team members in place and we’ll maintain a lot of those team members that we’ve staffed up for peak to continue with this vaccine distribution beyond.

Thank you. Mr. Wheeler did you have anything?

Very similar. So, every year, we plan on peak. We’ve added 100,000 temporary workers to get us through. This was going to be our biggest peak ever and I believe that’s probably the same for my colleague here. So, planning for the capacity is something we do every year and we’ve done this now for several months. It turns out that the volume is there. We’re seeing that. In terms of the vaccines, similar, to what Richard was showing is we have a UPS premier gold service. There’s four radios in this label. This label will go on every single vaccine package and every dry ice package. This allows us to see the package as soon as it arrives in any of our locations. So, as soon as it arrives in any hub, any airport, and even some of our ancillary supplier areas, we will see the package. It’ll get priority. It goes on the plane first, it comes off the plane first. So, that gives us the ability to see the package.

We have triple redundancy, so when the packages leave Kalamazoo, Michigan, or one of the locations of the vaccine manufacturers, the trucks will have a sensory device. This is a GPS tracker that also gives temperature, that gives light exposure and motion. So, it gives us a lot of data, and Pfizer is also providing data from their own packages so we have three ways of looking at the package through the system and all that data streams into our command center and we transmit that data to Operation Warp Speed. So, we’re all watching the packages all day long, and we have very, very high confidence that we’ll see all the packages running through the network.

Thank you, sir. Senator Klobuchar.

Senator Klobuchar: (39:08)
Thank you very much, and thank you to all the witnesses here. I think we all know that this vaccine or the vaccines are going to be critical to getting our economy moving again in such a big way. And while states, including my own state of Minnesota, are making the decisions about exactly their own plans for distribution, I think we all know they can’t do it alone. So, that’s why this time is so critical as we’re in this hearing room, and I want to thank the chair and the ranking member for holding this important hearing at this time. We’ve got to make sure that the resources are there for the states and locals. So, I guess I would start with a quick question there of Dr. Levine, and that is, could you explain, Dr. Levine, and thank you for your good work, why it’s so important to get some federal help in getting the vaccine distribution going?

Dr. Levine: (40:03)
Well, thank you very much, Senator, for that question. So, the states and the territories, as well as the big cities chosen for this mission, stand ready to accomplish it and to immunize everyone in the United States that will accept the vaccine, but that’s a critical point. It is absolutely essential that we have proper communication and education messages from the CDC, but also from each state, territory, and city, to be able to educate people about the safety and effectiveness of the vaccine and to educate people and to dispel misconceptions about the vaccine, as well as work past vaccine hesitancy.

Dr. Levine: (40:48)
We currently have no funding to accomplish that part of our mission, so again, $340 million to all of the states. Pennsylvania’s share of that is approximately $ 14.6 million, and that is going to give us a start as we work to distribute and administer the vaccine, hopefully starting next week and then through December and into January. But this is a long mission-

Agreed.

Dr. Levine: (41:14)
And It’s going to take much more funding and we have no money for the communication.

Okay. Thank you. Mr. Smith, you feel like everyone’s becoming doctors now, and Mr. Wheeler, thank you for the work and also of your employees right now. I left my apartment building in Washington, so all the packages and people working hard, including postal service employees, your employees, and so many people every single day are on the front line. So, I want to thank them through you for that. Make no complaints about package deliveries. Everything’s been going well. But I was concerned about how these vaccines are going to get to the rural areas because they’re not just going to be parachuted in the middle of Luverne, Minnesota, or to one of the communities in Nebraska for Center Fisher. So could you talk about how you’re paying attention to that?

Sure, of course. As I mentioned in my remarks, we have the capability to serve every zip code in the United States of America. We do it every day. We have over 1.7 billion zip code service combinations. So, with this network capacity, whether you live in Chicago, Illinois, or Murdo, South Dakota, we’re able to ensure time-definite deliveries of these shipments and we feel very confident in our capabilities in this regard. This is what our network was built to do.

Okay. And then could I add, Mr. Wheeler, just because time’s limited here, pharmaceutical companies have reported that about 5 to 20% of vaccines spoiled during distribution. Not your fault. It’s just a fact. Since they are highly perishable products. We don’t have an unlimited supply. More than ever, it’s really, really important that they not do that, and I assume this tracking technology that you both were talking about is part of that. So, in addition to talking about rural, could you get at that?

If I understand the question, Senator Klobuchar, it’s about the protection of the product?

Mm-hmm (affirmative).

Okay, well this is the product. This is a two mil vial. So, this is the Pfizer vaccine. Not the actual vaccine.

Okay. That’s good to know.

Five doses from this when they dilute it. The packaging that Pfizer has developed and … exclusive to Pfizer. We presented that to the president’s vaccine summit this week. Very, very highly complex. It has dry ice in the bottom, and it has a payload in the middle. It has what we call pizza trays, where they can put up to 195 of these small vials in the tray, and then they’re packed with more dry ice, and then there’s a tracking device on top. I can assure you that I’ve never seen packaging quite that complicated before, and they’ve been very proud to develop that and we were the first to show that out this week. I’m pretty confident aside from real big damage, that we’re going to have a lot less spoilage than you think.

And my last question is just the dry ice that I think, Mr. Wheeler, you talked about how I know UPS Healthcare announced increased dry ice production capacity, producing something like 1200 pounds of dry ice per hour, is that right?

24,000 per day.

Okay. Can any of that dry ice be made available for hospitals and clinics that need extra cold storage and how has supply for necessary transportation and storage materials kept up with this increased demand? I’m trying to look at this as the entire supply chain here as we get this vaccine out.

I’m sure we both agree on the same that there’s plenty of third-party supply for dry ice and we’re both prepared to do that. We have that now, and we’re fine with the first several months of dry ice, but to top that off, we actually built a dry ice manufacturing plant in Kentucky. So, we now have the contingency dry ice, and we are able if we have extra dry ice and I’m sure we will, we can provide that to independent hospitals and clinics around the world, around the country.

Very good. Want to add anything, Mr. Smith?

No, I think he covered it well. We’ve talked to a number of vendors we use across the country, across the world, on dry ice in terms of dry ice replenishment or top off for packages when they experience a delay, particularly an international package with a prolonged delay where you may be asked by the customer to top it off. We’re not being asked in this instance to do that while it’s in transit. Post-delivery, there may be some dry ice top off that certain specialty couriers and vendors, Marken, which UPS acquired and is part of their healthcare business, which Mr. Wheeler ran, will be providing some of those services where they top off post-delivery. But in talking to all these vendors out there, they do not believe that this talk of a dry ice shortage is real. They think there’s plenty of dry ice out there.

Okay, good. Thank you, both of you and thank you, Dr. Levine, as well.

Thank you, Senator Klobuchar. I appreciate your comments on how to get things out to rural America. I live an hour and a half South of Murdo, South Dakota, and with that, I’d like to recognize Senator Johnson.

Senator Johnson: (46:20)
Thank you, Chairman Fischer, for holding this important hearing in the midst of such a challenging year. We’re excited about the high level of innovation and ingenuity that went into developing these vaccines, and it’s going to take a high level of ingenuity and innovation and coordination, obviously, to get it distributed across the country. I also will echo what Mike Chair from Nebraska and my colleague from Minnesota said about getting into rural areas, particularly places like Murdo, so I appreciate your focus on that. I want to know, obviously it’s going to take a sophisticated multimodal supply chain at this scale, and that’s going to require logistical coordination, not only within individual organizations but between them. At least two vaccines each with its own set of considerations and methods for distribution are likely to be authorized in the near future.

Could you speak, Mr. Smith and Mr. Wheeler, to how are you preparing to simultaneously distribute these vaccines at scale in a safe and rapid manner, and does the potential authorization of additional vaccines add further complexity to that challenge?

Well, there are two models currently with the vaccines that we’re talking about here, the Pfizer and the Moderna vaccine. Moderna has opted to use McKesson to put together the full package if you will, to do the kitting of the vaccine with the syringes, needles, alcohol wipes, and if vaccines require a diluent or Agilent, they will do all of that at the distributor site. Ship it out at once. Pfizer’s model’s a little different. The actual vaccine will come from the Pfizer manufacturing site, and it will marry up with the kitting, which will come from McKesson at the administration site. Having said that, as I alluded to earlier when I talked about the discreet, just in the U.S., the discreet origin-destination pairs we can connect with our network and a network like UPS, that’s not really a challenge.

As more vaccines come on, this is what we do every single day. They are asking us to transport them rapidly and reliably from point A to point B, to get them from either the manufacturer or the distributor site to tens of thousands of administration sites. We do that every single day and the packaging, as Mr. Wheeler alluded to, the onus of protecting the product is mostly on the packaging in transit unless there’s some sort of unforeseen delay.

I think Richard said it well. I think I’ll just add to this that there’s a complex difference between the two. The Pfizer vaccine does require a diluent and the diluent is going with the McKesson shipment with the kits and the PPE and the syringes that are necessary. The good thing about that process is that those kits are going out from UPS a day before the vaccines arrive. It gives us good visibility of where the vaccines will be delivered so if there’s any errors at all in the addresses, we’ll know that. So, when the kits arrive at the dosing sites, then the vaccine the next day, and then we top it up with dry ice. That’s the Pfizer. Moderna is a little different. Just as Richard said, the whole package is going together from McKesson. It makes it a little bit easier. We’re picking up from the McKesson site in Shepherdsville, Kentucky, and then taking it to all destinations that we’re assigned.

So, in addition to the work that you all are doing, there are some passenger carriers included United, American, and Delta, they’re preparing also to rapidly distribute some of the vaccines. Can you describe how your companies plan to coordinate with other carriers in that distribution?

Well, in the domestic United States, we don’t have a need to collaborate with any passenger carriers. As I mentioned, we run the largest all-cargo airline in the world. Our esteemed competitor here runs a pretty substantial airline themselves, and we have plenty of capacity for this in our own system, particularly in the domestic United States, but we think worldwide.

As you know, the U.S. Department of Transportation is committed to providing the regulatory flexibility that’s necessary for rapid vaccine distribution. Beyond the actions that have been taken by the department so far, do you have any suggestions for regulatory relief that would improve the ability of supply chains to adequately meet the task? Are you getting what you need from the Transportation Department?

I mean, in our view, the federal government’s been highly supportive in helping essential service providers to continue to operate during these difficult times. As one example, the DOT’s been proactive issuing guidance and providing relief on expiring drivers and pilots licenses, medical certifications, facilitating alternative methods of training where appropriate, developing guidance on employee health safety practices, and working with states and foreign governments on policies that allow our team members to continue to work. So, we’ve been getting a lot of great support.

Okay. Mr. Wheeler?

I’ll just add one thing. It was mentioned earlier. We are working with the FAA. They have actually asked us to send them a file every day of where the flights are landing. So, in the event that they have difficulties or backup landing aircraft in a certain airport, they will know that vaccines are coming and they’ll give priority to those shipments coming in.

Good. I’m pleased to hear that. Madam Chair, I think that the willingness of the DOT to make this as easy as possible, given, obviously, all the regulations that you all live by on a daily basis is really important.

Speaker 2: (52:03)
Relations that you all live by on a daily basis is really important to expedite it, get it out there as quickly as possible in a safe way, so thank you. Appreciating you being here.

Chairman Fischer: (52:11)
Thank you, Senator Thune. Next we have Senator Peters, please.

Senator Peters: (52:16)
Thank you, madam chair. Good morning, gentlemen. Good to have both of you here and a third via online here. Dr. Lavigne, a question for you. I think it’s a similar question that was asked of Mr. Smith but I think it’s important for me to get a sense from your state because Pennsylvania is a lot like Michigan. Michigan is the home of a significant number of rural communities. In fact, 2/3rds of our state is classified as rural, and about 30% of those residents in those areas are over 60 who, as you know, are high in priority for receiving the vaccine. But given the number limited, number of medical facilities and infrastructure in these communities, give me a sense of how you’re preparing to make sure these vaccines remain stable and at the temperature that they need. It’s a significant challenge and we’ve got to get a sense of what you’re doing in Pennsylvania. It may help us as we’re thinking through our issues.

Dr. Levine: (53:11)
Well, thank you very much for that question, Senator. Yes, Pennsylvania is a very rural state. For the first vaccine, the Pfizer vaccine, we have approximately 100 hospitals that will be to serve as the first stage of the vaccine to be able to immunize healthcare workers for that first part of the mission. Those are hospitals that have the ability to do two things; one is to have the cold-change storage and the refrigeration capacity at their hospital, and the second is to do a widespread vaccination of at least 975 doses with the first trays, as our colleagues talked about.

Dr. Levine: (53:53)
After that, we’re anticipating that the Moderna vaccine will come out, hopefully, within several weeks. That is the vaccine that’ll be distributed to the rural hospitals, much of whom do not have the capacity to be able to store the Pfizer vaccine and will be accomplishing the mission of immunizing healthcare workers in those areas with a hub-and-spokes method.

Dr. Levine: (54:14)
In terms of long-term care living facilities, both vaccines will be going to distribution centers through our pharmacy partners, CVS and Walgreens, and then they have hired significant personnel to go out to nursing homes and other facilities to accomplish those immunizations.

Does your state or other states have resources to implement perhaps a mobile vaccination clinic to reach some of these areas rurally?

Dr. Levine: (54:40)
Yes, we will. That will come into play with future phases of the vaccine, particularly phase two and phase three where, actually, the Department of Health is coordinating much of the vaccination through vaccine clinics, through FQ8C’s and through something like mobile vans.

Dr. Levine: (55:02)
For phase one, it really is going to be the hospitals that’ll be immunizing most of the healthcare workers, and again, CVS and Walgreens, our pharmacy partners, going directly to long-term care facilities to accomplish those immunizations.

Right. Well, thank you. Questions for Mr. Smith and Mr. Wheeler. IBM recently released a very disturbing report detailing cyber attacks on COVID-19 vaccine distribution infrastructure. And just last month, a cold-chain storage company also reported that they were the target of a cyber attack. My question to both of you is what specific steps are you taking to ensure hackers are not able to disrupt the distribution networks for the vaccine through your companies?

Thank you, Senator. I appreciate this question. I know you understand the sensitivity of this type of information that we’re dealing with. We certainly do at FedEx, and we’re engaged with all the relevant agencies and stakeholders on this issue. We’re taking all the necessary precautions using the latest technology, as we pointed out, to safely and securely support these vaccines.

We also have a tremendously strong information security group, info sec, we call it, at FedEx. It’s not my area. I run operations and network planning and engineering for the Americas. But we can certainly followup with you with more specifics on all of the things we’ve done. They do a fantastic job hardening our network and protecting us from attacks.

Great. Thank you. Mr. Wheeler?

Just to add to that; I think a good way to answer the question is Pfizer and Mckesson, the two primary distributors coming up soon, are long-standing clients of ours. I’m sure FedEx works with them as well. The data movement between these companies… And UPS is well, well trodden. It’s a path that we’ve been walking for a very long time. Those data feeds are well protected. We have firewalls, we have all the necessary security measures. And we actually presented this yesterday at the Operation Warp Speed headquarters here at HHS to give them the assurance that we have the right security measures in place.

Right. Thank you.

Thank you, Senator Peters. Next we have Senator Capito.

Senator Capito: (57:25)
Chair. And thank you all for being here. Can you see me here?

Yes, we see you.

Okay, got it.

We hear you as well.

Great, great. Thank you for having this hearing and thank you, all three of you, for being here. As you can imagine, this is very much top of mind of many, many people, certainly in the state of West Virginia, but all across the country. The logistics of this, I think, are exceedingly important so Dr. Lavigne, I’d like to ask you the first question. At your neighboring state of Pennsylvania you might’ve noticed our state of West Virginia, we’ve really relied on our National Guard to be supply chain, to do PPE for our schools, they’ve done a lot of testing and have really filled in an enormous gap for us as a state and have really been the frontline workers, and the governors relied quite a bit on them. But is there any plan in Pennsylvania to use that supply chain, or that knowledge, that the Guard has accumulated over the last eight to nine months to be a part of this distribution once you secure the vaccine?

Dr. Levine: (58:31)
I know that other states do plan to utilize the National Guard for that mission. Right now in Pennsylvania, we do not. Our National Guard members, who’ve also been integral to our response, are actually working primarily in nursing homes and long-term care living facilities. We have used medical personnel extensively as strike teams to go into challenged nursing homes to provide direct care to patients who have specific… in nursing homes that have particular staffing issues because their staff either have COVID-19 or they’re in quarantine.

Dr. Levine: (59:09)
In addition, if we have to open alternative care sites for hospitalized patients, then we would use National Guard for that purpose. We have not used the Guard in our planning.

Okay. Second question is on the dosages. Let me ask a simple question; if you get the Pfizer first dose, is the amount of the first dose the same of the amount of the Pfizer second dose? In other words, are they like … Yes.

Dr. Levine: (59:36)
Yes.

Okay. On tracking that, I think this is going to be a potential problem. Particularly in rural America, how do you track who’s gotten the first one? How do you re-track if you don’t have connectivity for certain areas? Who has the responsibility of that? Do you as the chief medical officer? Does Pfizer have that responsibility? Where does that responsibility lie and where is the re-check going to be on this? Because my understanding is that second dose is very critical.

Dr. Levine: (01:00:04)
You are correct; the second dose is critical to produce the appropriate immune response so that the individual will have a really good chance of being immune to COVID-19. It is primarily our responsibility to track when the first dose is given and the second dose is given. We will be, of course, working with the healthcare providers themselves who have to input into our system that those doses are given. And both the healthcare providers and the Department of Health have recall mechanisms to contact patients who don’t come for their second dose.

Senator Capito: (01:00:38)
Do you have the systems already available to you that would be perfect for inputting this data so that you could follow up quickly and all that? That system, I’m going to assume, exists now. It’s not something you have to build.

Dr. Levine: (01:00:51)
No, the system exists now. We did have to update our current [inaudible 01:00:55] system and make it much more robust with redundancies for this mission, which is much bigger than other immunization campaigns we’ve had. But we have those systems present now.

Okay. Mr. Smith and Mr. Wheeler, let me ask you this question in terms of last house; my understanding that is in some cases the last house delivery from UPS or from FedEx may be from the US Postal Service. Is that a correct assumption? Am I right there?

Richard Smith: (01:01:24)
Do you want to take this? We both have services where we utilize the United States Postal Service for final mile delivery, primarily of light-weight, low value e-commerce items.

Okay. Would the vaccine fall into this? Or would that be something that you-

Absolutely now. The vaccine will be delivered by FedEx Express by a FedEx Express courier to these administration sites.

And is that the same with UPS?

Mr. Wheeler: (01:01:53)
Exactly the same with UPS. We are a 100% UPS network. And as you know-

Okay, good.

Mr. Wheeler: (01:01:58)
… all the employees are UPS employees.

Good. Well, I would imagine utilization of that, the fewer hands between the-

Mr. Wheeler: (01:02:08)
We agree.

… vaccine and the person who actually receives it obviously eliminates any kind of room for error there so I’m pleased to hear that.

Mr. Wheeler: (01:02:16)
Agree 100%.

Good. And then I was interested to hear too that there’ve been some relaxations of certain regulations, times of service. I heard expired licenses of pilots or extension of pilot licenses and other things; I understand that’s going to be very helpful to both of you to make sure that you got full capacity to be able to move forward. Do you have anything to add on that aspect where you might need some other flexibilities?

Mr. Wheeler: (01:02:44)
We’re actively testing all of our pilots on a regular basis to make sure that we can rotate the pilots efficiently. We have 3,000 pilots in the US and we are testing them all.

We’re doing the same. Our pilots are being tested before they fly on the mission, particularly internationally, so same.

Okay. But then let’s say, let’s go to your trucks; same thing? There are hours of service restrictions on those too. Do those come into play for you or not in this instance?

We think we can manage those and we don’t have any additional asks in that regard here.

Okay.

Mr. Wheeler: (01:03:23)
I’ll just add we said before that we’re giving priority to all the vaccine shipments so as soon as they arrive in the destination location, our sort facilities or our hub facilities, the drivers will know exactly that they’re moving the vaccine. It’s a priority for them. They’ll put those packages on their trucks first and the others will follow.

Okay, final question for both of you obviously getting a vaccine; I saw you with the little vial of the fake Pfizer vaccine. Obviously you need swabs, you need injection devices. Are you in contact with those manufacturers too to make sure that… Are you a part of that whole stream of logistics that are going to be important to delivering this vaccine, Mr. Wheeler?

Mr. Wheeler: (01:04:08)
Yeah, UPS moves everything. We are moving insularity supplies to our customers, we’re moving glass vials-

[crosstalk 01:04:15] No, I mean is that something that you’re making special considerations for as you are for the vaccine itself?

Mr. Wheeler: (01:04:20)
Of course.

Yeah.

We’re planning for a-

Mr. Smith?

Yeah, same. We’re planning for everything. Anything that we’re asked to move, from a distributor like Mckesson or directly from a manufacturer like Pfizer in terms of just shipping vaccine, or whether we’re shipping vaccine and kitting, we are same as UPS; we’re prepared for it and ready and planning that with them.

Okay, thank you.

Chairman Fischer: (01:04:46)
Thank you, Senator Capito. Senator Baldwin, you are recognized.

Senator Baldwin: (01:04:51)
Thank you, madam chairwoman. Like so many of my colleagues, we’re very much looking forward to hearing from the FDA later today, but we all know that we have a lot of work to do. We still need to wear our masks, we still need to limit our gatherings until at least 70% of Americans are vaccinated. And there are states that are going to need support. I want to share that in hearing from Wisconsin officials, they’ve been working overtime to provide care to patients with COVID-19, reduce the spread, and prepare for the vaccine distribution.

But the state estimates that they will need an additional $10 million for vaccine infrastructure readiness over the months to come. States are doing as much as they can to get ready but they can’t do this work alone, as we all know. And I’m concerned about the potential for breakdown in coordination between the federal government states and partners of the private sector. We’ve got to get this right from the very start. Mr. Wheeler and Mr. Smith, given your roles in the distribution process, can you describe which points in the distribution coordination will be the most critical and where yous see the potential for breakdowns? What do we need to do to ensure better coordination at these various points?

Mr. Wheeler: (01:06:26)
I think what I would ask is that the state jurisdictions that are working with Operation Warp Speed come up with a very good forecasting model. As soon as we can see that the volume coming through the pipeline and through the system, the better. I think that’s probably the best way to answer it. We are taking orders from Mckesson and Pfizer for these two vaccines that come straight in. We have embedded employees at their locations so we’re scanning everything from the origin to the final destination. And Operation Warp Speed is really driving the train here. They’re the ones giving us the orders to move.

And I would just second that. We feel very confident, as I know UPS does, about our role in this, particularly the transport from point A to point B. We don’t decide where the vaccines go, how much is allocated to each state, how it’s allocated within the state. We’re the transportation provider and our mission is to get it there rapidly and reliably, safely and securely. But we’re very confident about it and our system. There are certainly things before it enters our system that are outside of our control. There are things after we deliver it that are outside of our control, but I’m confident about it when it’s within our control. And I’ll just echo what-

Mr. Wheeler: (01:07:44)
I might add that it’s very useful to have CVS and Walgreens signed up as really the primary destinations, at least for these first few months. That’s very helpful because both companies know CVS and Walgreens very well. We have all the addresses, we deliver everyday for all sorts of things. Having that focus is very, very important to the supply chain, I believe.

Thank you. Dr. Lavigne, I’d like to ask you about dry ice, especially given its essential role in delivering the Pfizer vaccine doses. Pfizer has developed plans to secure access to dry ice for their initial shipments, but I’m wondering about the second phase of dry ice demand when Pfizer shipping containers are replenished with dry ice at the state and local level. I understand that it is state and local health leaders, or whoever receives the shipment within the state, who are responsible for ensuring their supply at that point. This is all happening at a time of heightened demand for dry ice around the holidays and in an industry that operates in a just in time basis given the short window to use dry ice after it’s manufactured. Do state and local leaders who anticipate receiving a shipment of Pfizer vaccines have clear and robust information about how and where to source dry ice that’s needed for the replenishment and adequate cooling of the supplies that they are likely to receive?

Dr. Levine: (01:09:25)
Yes, the Pennsylvania Department of Health working with PEMA, the Pennsylvania Emergency Management Agency, would be able to obtain dry ice if necessary. For the first stages, we actually don’t anticipate it’ll be necessary because, again, the Pfizer vaccine will be going to hospitals. And particularly, that vaccine will be going to hospitals that have themselves the refrigeration capacity to be able to keep it at the ultra-cold storage temperature that is necessary.

Dr. Levine: (01:09:55)
And then for the long-term care facilities, as was mentioned, it’s going to distribution centers at CVS and Walgreens, and those centers also have the refrigeration capacity to be able to keep it at a ultra-cold temperature.

Dr. Levine: (01:10:08)
Now, with future distributions as it goes more out to FQ8C’s and et cetera, we’re going to be able to really try to work that they can be administered right when the box is open and we can administer that amount of vaccine.

Dr. Levine: (01:10:26)
I think the Moderna vaccine, which has less requirements, will be much easier to distribute, as I mentioned, to rural Pennsylvania and other parts of Pennsylvania that won’t really have access to those refrigeration capacities.

Is there any information that you would like to be made available by the federal government or through cooperation of the industry to ensure that local health officials have a clear direction on dry ice sourcing protocols or alternative sourcing plans if needed and pricing? Any sort of dashboard that should be required?

Dr. Levine: (01:11:03)
Absolutely. I think what we’ve shown is that it is really challenging when the states are almost competing with each other for needed resources. And that occurred in the spring, particularly for personal protective equipment. Since we know that every state in the country is going to need this material for the eventual distribution as time goes on of the Pfizer product, it would be helpful if the federal government coordinated that and we didn’t have to bid against our sister states.

Thank you.

Chairman Fischer: (01:11:39)
Thank you, Senator Baldwin. Senator Tester, you are recognized.

Senator Tester: (01:11:44)
Well, thank you Chairman Fischer. And I want to thank you and the ranking members for holding this hearing. It’s one of the reasons I don’t normally sit on the sub-committee, but it’s a critically important area and I want to thank you guys for doing this. And I want to thank all the folks who have testified. Now, this is for Mr. Smith and Mr. Wheeler. We’ve got about 10,000 doses coming into Montana in this first round. They’re all going to be allocated to hospitals that are in the seven major cities in Montana. I hope there’s going to be no problem there, and I don’t think there will be a problem. It sounds like you guys have planned for that. They have access to things that a lot of the rural and frontier towns that have hospitals in them do not.

I think if this vaccine is going to be distributed throughout the country, and I think chairman Fischer knows this as well as anybody, the rural areas are really going to, I think, pose some issues. And so the first question I had for either or both of you is, and I know it depends on location, but how long to the furthest location out there do you think it will take to get from the distribution center where you pick the vaccine up to its final location? Assuming that it’s more than just those seven major cities in Montana. Assuming it’s a town like Chester, Montana or Harlowton, Montana that have much smaller populations that are a ways away from these more populated areas in the state of Montana.

I have to take this one because I can’t resist. In the United States, as our old tagline used to say, absolutely, positively overnight.

Okay, good. Mr. Wheeler?

Mr. Wheeler: (01:13:36)
We’re planning on next-day 10:30 AM arrival anywhere that we’re assigned. Of course, FedEx and UPS have split the country into two. We know exactly what states we have and they know what states they have. We’re guaranteeing overnight from the time that it leaves the Pfizer location or the Mckesson location until it arrives the next morning at 10:30. And, of course, remember that the dry ice packaging with Pfizer is a 10-day package. It’s good for 10 days and then they’ll have additional 40 pounds of dry ice to replenish, which gives you more life.

No, I think that’s good. I think the key is to get the vaccine into the bodies of the people who need it. Has Pfizer or Moderna or anybody, CVC or anybody, told you guys what the protocol is going to be to let you know when you’re going to pick it up so that the hospital knows? You guys are going to deliver it overnight, or by 10:30 the next day. That hospital has to be ready for it, they have to let their patients know it’s available, and probably individually call the patients who are most susceptible. Have they told you what the protocol is going to be to letting people know that this vaccine’s coming to X-town in Montana?

Mr. Wheeler: (01:14:54)
Not really, but we have an idea how they want to do this. Pfizer has very, very specific protocol for how the package is handled, how many times a day it can be opened, how many vials can be withdrawn. I think the best answer to the question is the states and the jurisdictions and all the dosing centers have to have their patients lined up; lined up so they don’t waste any vials. Once you take the vials out of the box and they thaw, you can’t re-freeze them.

Gotcha.

[crosstalk 01:15:23] Yes, I’ll just echo my colleague here that they have those processes they’re working on. When it tendered to us, we are told to transport it to the administration site overnight. And as Wes pointed out, we also deliver it by 10:30. We have the same commit time for our priority overnight shipments to business locations by 10:30. Like good competitors, we keep each other, one another, on our toes and we have the same commitment.

We like competition. This isn’t on you guys, but I certainly hope somebody out there… We’re going to distribute these vaccines in the winter, truthfully, and some will be done in the spring too, but primarily in the winter. And you guys know, because you deal with this stuff, if they’re going to get ahold of the patients, get them there so we don’t waste the vaccine, it’s going to take some planning. I hope somebody’s listening to this hearing that has some stroke in that because, quite frankly, you get a blizzard that blows through and it’s going to screw stuff up, and so it’s important.

Mr. Smith, I want to touch base with you. And this is a question that Senator Thune asked and it didn’t go over to Wheeler, but very, very quickly he talked about Delta and American and the airlines, the commercial airlines, potentially carrying this. His question was is how are you going to work with them? And you said, “We’ve got the capacity. Don’t worry about it.” Well, let’s say that whoever’s the king maker out there says, “Well, you know what? I don’t care if UPS or FedEx has the capacity, we’re using Delta,” for whatever reason it might be. Do you guys have that relationship to be able to work with those commercial airlines in case it isn’t on your ship?

Sure. We work with them in the international environment, both our companies do, which the industry called freight forwarding, where we’ll use passenger underbelly lift to move deferred air cargo point-to-point, airport to airport, as we say. But in the United States, we have plenty of capacity, as I pointed out. That decision to use a commercial airline I don’t think would make a lot of sense because they don’t have the infrastructure to connect all those origin destination pairs that I talked about, the 1.7 billion zip code combinations we connect. Because it’s not just about moving it from airport to airport; you’ve got to move it from the ramp at the airport to the station and then get it out into the field so they don’t have the infrastructure ability to do that and connect the country on such a widespread basis. I don’t think [crosstalk 01:18:01] that would happen in the US, but we would certainly work with them if they were brought in.

So I don’t think that would happen in the U.S., but we would certainly work with them if they were brought in.

Okay, that’s fine. That’s good. Thank you very much. And once again, Madam Chair and ranking member Duckworth, I just want to thank you guys for doing this hearing. I appreciate all the witnesses. Thank you.

Mrs. Fischer: (01:18:16)
Thank you, Senator Tester. While we’re waiting for a couple more senators to come I’m going to ask a couple more questions here, please. Dr. Levine, you noted in your testimony that during mock vaccine shipments, a quarter of the states experienced a lag in receiving the ancillary supply kits. Could you elaborate on what the challenge was and have you noticed any corrective action that’s being taken to address it?

Dr. Levine: (01:18:45)
Well, as you have stated, through ASTO, we keep in touch with all of the state health officials and there was a dry run. In Pennsylvania we did receive the mock shipment and the mock kitting that was discussed that that will be shipped separately for the Pfizer product, but insignificant number of states, they did not all come at the same time. So as was mentioned, you’re going to have three different components, the vaccine itself, the diluent, and the kitting, and it all these to arrive at the exact same place at the right time so that the vaccine can be administered.

Dr. Levine: (01:19:21)
Now, we don’t transport that. That’s being transported through our partners here, the other testifiers as well as under the jurisdiction of Operation Warp Speed. And so when the ball comes to us and all of it is present, and then our supervision comes in and we work with the hospitals and then with the pharmaceutical partners to administer the vaccine. So all of that was related to Operation Warp Speed about the challenges that some of the states had. And so hopefully those difficulties will be ironed out and everything will arrive at the correct time next week when the Pfizer product hopefully will ship.

Thank you. And Mr. Smith or Mr. Wheeler, is FedEx or ups planning to be involved in the shipping of the ancillary supply kits? And how are you ensuring those shipments are timed to arrive with the vaccine doses ready to ship?

Mr. Wheeler: (01:20:21)
Yeah, I was going to mention that this week when we presented to the vaccine task force, McKesson basically said that they built 150 million test kits already, so they’ve stockpiled the ancillary supplies. Moderna and Pfizer, both being built now, so they’re ready to go. That has the syringe, the diluent, the PPE, the instructions to the dosing sites, the mixing vials as well. All that is ready to go. UPS will be supplying a hundred percent of all the kits to the country. FedEx and UPS will then follow with the vaccine shipments and then we will follow all a hundred of the sites with dry ice.

Okay, thank you.

So in some respects, just to point out how profound this is, you have two fierce rivals here and competitors in FedEx and UPS who literally are teaming up to get this delivered, and in some cases, that relationship is interdependent with them shipping the kitting and us shipping the vaccine to certain states. So we’re relying on one another. It’s almost like, and I hope Senator Wicker is still watching, but it’s almost like two rival college football teams say Ole Miss, Hotty Toddy, and Mississippi State coming together on the same NFL team to play as teammates.

Thank you, Senator Blumenthal, you are recognized.

Senator Blumenthal: (01:21:46)
Thanks Mr chairman, and thank you both for being here. Thanks for your cooperation. I don’t know whether football is a perfect analogy, but on this issue, I’m glad you’re on the same team and that you are working together because the American people really need that kind of cooperation and we are on the cusp of historic approval of the Pfizer vaccine, hopefully next week. The Moderna vaccine, and as you know, there are challenges in shipping it. I’m proud to say that a number of efforts by manufacturers are innovating in this area on cold storage and transport. In fact, I attended a virtual demonstration of the Bozrah based Gilman brothers vaccine transport system, demonstrating their capability for vaccine transportation and I think that kind of innovation and invention can help in the massive, and I emphasize massive, challenge of distribution. People expect that it will arrive at their local CVS tomorrow, because that’s the way American enterprise works but I recognize you have great challenges ahead.

I want to emphasize one particular aspect of this challenge, which actually arose yesterday in a hearing of the veterans affairs committee, the head of the veterans affairs health system indicated that they are facing obstacles and challenges to deliver the vaccine to their health facilities. That is veterans health facilities. Could you address what specific steps you’re taking to provide this vaccine to our veterans, which is so important. They are in the age group that is most vulnerable. Many of them are veterans of wars of decades ago and they need this vaccine and they need it right away. They’re going to get it, hopefully through their veterans facilities, like the West Haven facility in Connecticut, which right now is apparently not on the list to receive it because of these logistical obstacles. So maybe you can address that aspect of the issue.

I’m not aware of any logistical obstacles that prevent us from delivering to the veterans. We were founded by a proud veteran of the Marine Corps, Vietnam veteran, who did two tours of duty in Vietnam so we live to serve our veterans. We employ a lot of veterans. We don’t have any control over where the vaccine goes. We are told where to deliver it. We’re simply the transportation provider here. So I’m not aware of any logistics challenges that would prevent us from delivering to the VA hospitals or to getting it to our veterans. Certainly willing to look into that. Anything you’ve heard on the logistics side, because I have not heard that.

Mr. Wheeler: (01:24:53)
Senator Blumenthal, I think Connecticut is assigned to UPS so we’ll be delivering to Connecticut. We don’t have the addresses yet. I was on the phone with General Perna yesterday and we’re waiting for the addresses any day now. We have sent the kits out, so the kids have gone. They’re arriving this morning. We’ll look at the addresses and make sure we get them.

I’m so glad to hear that because I think our veterans will expect it and I’d like to work with both of you, have my staff perhaps contact you, and work with the VA to make sure that there are no difficulties. I’m not attributing any of those obstacles to you I should emphasize, but I just want to make sure that we focus on getting the job done. As you know, onsite cold storage is as critical to vaccine efficacy and effectiveness as storage during transportation. What challenges do you anticipate providers may face after receiving those vaccine shipments?

Mr. Wheeler: (01:25:56)
Yeah, we’ve talked a lot about, I mean Moderna and Pfizer are a little bit different. So Moderna is at minus 20, typical freezer temperature. So in terms of storage at the sites, there’s probably more of that available at most of these sites. Pfizer, recognizing that, has built this amazing package that can keep that minus 70 for 10 days and we’re providing additional dry ice to keep it longer. And beyond that, we’ve offered to many sites. In fact, we already have a hundred orders of portable freezers that you plug into your outlet at minus 70 degrees and this maintains temperature forever and so we’ve offered that as well.

Thank you.

We we’ve talked to some of the big pharmacies like Walgreens who’s our customer, and they’re acquiring some of these freezer units as well to stage the product and keep it ultra cold after delivery.

Thank you, thank you both. My time has expired, but this topic is top of mind, I think for all of us and your being here today, along with Dr. Levine of Pennsylvania is very welcome and I’m sure we’ll be hearing from you again. Thanks so much.

Thank you, Senator Blumenthal. As we wait for the ranking member, Senator Cantwell, to come ask questions, I have a couple more questions that I’d like to ask. Dr. Levine, the CDC and Operation Warp Speed planning documents indicate that the jurisdictions will be responsible for any redistribution of vaccines after the doses are shipped to the identified provider. Do you anticipate jurisdictions redistributing many vaccine doses after those have been received by the providers and if so, can you outline what those redistribution procedures may look like?

Dr. Levine: (01:27:46)
Well, so as the Moderna product is going out, particularly because it doesn’t require the ultra cold chain, to hospitals, we will distribute some of those for instance, to federally qualified health centers, because we want to think of healthcare providers extremely broadly. It’s not just hospital providers. It really has to be anybody that is on the front lines, seeing patients with COVID-19. For instance, including EMS providers. So we do anticipate some re-distribution, particularly of the Moderna, to accomplish that.

Thank you. And for the entire panel, given the magnitude of transporting so many vaccine doses, I anticipate flexibility among all stakeholders is going to be extremely important. How are each of you planning to incorporate changes into your logistics or planning as the vaccination effort progresses? Dr. Levine, would you like to start please?

Dr. Levine: (01:28:49)
Sure. So, all of the vaccine plans that we have really, I consider drafts for our state and for all of the states, because there are many different factors that are going to come up on as this mission proceeds. For example, we don’t yet know what recommendations the FDA might state about the Pfizer and then the Moderna product, which would change our vaccine plans, as well as when it goes to the advisory committee on immunization practice from the CDC, which might have some specific recommendations about administration, which would then change our plans. And that would be true of the Moderna product as well. Of course, as the time is going and we are immunizing according to the three phases of the CDC, things are going to change in terms of the spread of the virus and which groups might be most impacted. And so I think that it will be very important for the states, territories, and cities involved to be very nimble and flexible with their plans going forward, just to make sure that we’re able to immunize the members of the public as is necessary.

Thank you. Mr. Smith.

Sure. There’s an old saying I’m very fond of. Men make plans or men and women make plans and the gods laugh. We deal with the unforeseen everyday. Weather, traffic, you name it. For international shipments, regulatory holds, customs delays, and that sort of thing. So our plans have to be flexible every single day and it’s customer specific often. I mentioned a new product introduction like a new iPhone or a new medicine that’s being brought to market. I mean, those things require tremendous planning and sometimes the forecasting is wrong. So you have to adjust. So we do this every day, adjust to changes on the battlefield, as we say, and we’re well-versed in it. And we don’t expect anything that we won’t be able to handle in that regard.

Okay.

Mr. Wheeler: (01:30:51)
The beauty of our network is that all of these vaccine shipments are going from, for the first couple of months anyway, until we get the next vaccine approved, will come from three locations into our Louisville world port facility. Every day we have 400 flights landing and 400 flights taking off to reach destinations around the country the next morning. Every time a vaccine shipment is sourced. It comes with the tag, the tag gives it priority and as soon as we have a change in addresses or change in priority or change in volume, we can immediately pivot to make sure those that those vaccines arrive the next day at whatever location is required. We’re taking direction from general Perna and his team and we’re very flexible, both companies.

I should add that both of these networks have tremendous redundancy built into them. So we have our express super hub in Memphis, Tennessee, we have our other major inland sort location in Indianapolis. We also have hubs and Newark, Greensboro, Miami, Dallas-Fort Worth, Oakland, and Anchorage, Alaska just in the United States alone. So we have redundancy in the event of weather events or other unforeseen things.

Okay, and I’d like to go back to follow up a little bit on Senator Peters’ question about the IBM report on the cyber attacks. IBM specifically identified phishing email attacks in its report. What also are you doing to ensure employees have the appropriate cybersecurity training to ward off these attacks?

Yeah, we battle those every day. As I mentioned, our InfoSec, information security department is extremely good. We can certainly follow up with more information about all of the things they’re doing in cooperation with federal agencies and internally to battle this. We have regular training and communications that go out to employees. We mark any email that doesn’t come from within the FedEx system, behind the firewalls, as external. So they know that it’s an external email. We tell them not to open links, not to open the email. We can constantly train them and refresh that training. So we do a number of things to harden our systems, but also to educate our employees about what to look out for.

I imagine you both face hundreds of thousands of attacks every single day. In this public setting, can you give us any information on if you have been specifically targeted by any type of cyber attack and if it was to your administration or was it to an employee? Can you tell us any of that in this setting?

Mr. Wheeler: (01:33:40)
We’re not in a position to say that today, but we have attacks every day and we have information security and cyber security, and we work with CYSA on best practices, whatever comes up in the industry that’s new, that’s better than we have, we adopt those things. But we have incredibly tight email systems and systems around the country and as I said earlier, Pfizer and McKesson, the data flows between Pfizer McKesson and UPS and Operation Warp Speed are well-established and have been for quite some time.

Thank you very much, Senator Cantwell.

Senator Cantwell: (01:34:15)
Thank you, Madam chair and thank you to you and Senator Duckworth for holding this important hearing. I’ve had to be in and out because small businesses also talking about PPP so we’re really trying to pay attention to what we need to help people dealing with this unbelievable COVID pandemic that’s increasing in impact right now in a very critical moment. So I wanted to ask a question about what we’re doing to help states and municipalities on the delivery system. I’ve heard from my mayors, I’ve heard from our health officials, this is a very intense operation on the ground, and they’re going to need help and resources in the delivery system. And I want to make sure that we’re thinking about how you give equitable access. I heard in some of the discussion about nursing homes and definitely agree about that distribution, but I want to make sure that we’re getting equitable distribution to very challenged and underserved communities.

We obviously, in the state of Washington, have 29 tribes in a big geographic area and delivering to Native Americans, and I’m sure I could give other examples. And then I just want one more time to ask the question that Senator Capito was trying to get at with our major layoffs in the aviation sector. Are we sure that there is nothing we need to do there in making sure that we have both pilots and equipment to be ready on the rotation side? When you obviously lay people off, they have to then re-qualify and when you have equipment that’s been out of service, it needs to be, I don’t know, what the right word is re-evaluated and put back into service in a new way. So I just want, if you can answer those questions or address those issues, which are, what do we need to do to help state and local governments on the distribution side? What do we need to make sure to do equitable for minority communities? And are you sure we have this figured out on the workforce and equipment side?

Let me answer those in reverse order. We were very confident and I believe that Wes would say the same, that we have the assets, we have the crews, we have the infrastructure to support this mission. We have the-

And is that, just if I could, and is that because nobody in the rest of the larger aviation sector will be called on or will there be some transport over our general carriers because they are in the carrier business too? So is there nothing that they’re going to be impacted on?

We don’t believe at this point in time in the United States to deliver this, we’re going to need to rely on the passenger airline sector at all. Again, they could fly it airport to airport. We have plenty of capacity for that. Plenty of well-trained, excellent pilots and crew members who fly our missions every day. I know UPS is the same. We have plenty of capacity in the United States, but also the ability with these networks we operate. There are only two companies in the United States of America that have the networks to connect all those O&D pairs that I talked about on an overnight basis, and they’re both represented at this table. So the reason we’re both here and we’re both doing this is because we’re the only ones that can. So that’s the answer to the last question.

On the second, in terms of equitable distribution, we have no say in how this is being distributed. We are simply the transportation arm and our job is to get it from point A to point B rapidly and reliably, safely and securely. That’s just not a decision that we make. We’re told where to take the vaccines on a daily basis and that’s what we do. And then getting it out to rural areas. As I mentioned, we service every zip code in the United States of America. So does UPS, and we do that every day on an overnight basis by 10:30 the next day.

Mr. Wheeler: (01:38:06)
A lot of what he said, but just to add to that, the the beauty of our network is that it works only as a network. So we are planning a hundred percent with the UPS aircraft, UPS package cars and drivers and trucks, but we also have a very extensive courier network. So if we get into trouble anywhere and we have to get a vaccine overnight on a commercial aircraft, we have relationships with all of them, and charter aircraft. And we are actually working with a lot of the manufacturers to move active ingredient and bulk product into the United States from overseas on charter aircraft. So we have that ability. To go back to the question about helping states, we got pretty good at this with the test kits. So when we started and moving laboratory samples from patients to lab companies, we got very, very familiar with the state governments, the state jurisdictions and the health authorities there and we were helping a lot of the states to do that. And we still are, and that allows us to give you help wherever you need it.

Yeah, I think Madam chair, thank you again. This is so great that you had this hearing, but I think we need to figure out whether it’s us or someone else has to have the rest of this conversation. It reminds me a lot of what happened with the hurricanes in Puerto Rico, where we had a lot of cargo on the docks, but not distributed. And I know you have equipment that can get you into communities, but we still have this big question of who are you delivering it to and what do they have set up? And we see the complexity on TV of what it takes to actually use and do the vaccine. So the question is, who’s going to do that? And my sense is that states, cities, and public health districts, and they need resources and we need to make sure they have them. Otherwise, you’re going to do a really great job, and then we’re still going to have a roadblock. So thank you so much, this is helpful.

Very familiar with the situation in Puerto Rico because we flew a ton of that cargo into Puerto Rico. A lot of the issue there on the ground was the infrastructure being wiped out so.

Well, you have to have the infrastructure to deliver the vaccine. So anyway, we’ll get to this question, but again, thank you Madam chair, and thank you for working around the clock to help us on this pandemic.

Thank you, Senator Cantwell. At this time, I asked consent to enter several letters into the record. A statement from McKesson regarding their role in the vaccine distribution process, a letter from the transportation intermediaries association regarding third-party logistic providers role in the distribution process, letters from transportation industry and labor associations regarding vaccine prioritization, and a letter from the transportation safety associations regarding the safe transportation of vaccines. Without objection, so ordered.

The hearing record will remain open for two weeks. During this time, senators are asked to submit questions for the record. Upon receipt, the witnesses are requested to submit their written answers to the committee as soon as possible.

I would like to thank all of our panel today for a very informative hearing that we had. I appreciate the work that you and the people you represent do every single day to keep this country moving and keep us being able to receive what we need, when we need it so that it’s effective. So thank you very, very much. Thank you, Dr. Levine remotely. We appreciate your comments as well. With that, the hearing is adjourned.

Senate Commerce Hearing on COVID-19 Vaccine Transportation Transcript December 10

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