Friday, September 5, 2014

Knowledge@Wharton: The Critical Need For Cold

From K@W:
From Vaccines to Cheese Caves: Energizing the ‘Cold Chain’
More than two million people die each year from diseases that could otherwise be prevented through the use of vaccines targeted at those ailments. The challenge is not so much a shortage in the supply of those vaccines, but that they must be refrigerated from their point of manufacture to their point of distribution to end-users in remote locations that lack reliable the power required to keep those vaccines properly chilled.

The vaccine industry is only one of several sectors where maintaining the integrity of the “cold chain” is critical for preserving the safety and efficacy of high-value goods, notes Harvey Rubin, professor of medicine at the University of Pennsylvania’s Perelman School of Medicine. Although consumers in the industrialized world often take it for granted, sound management of the cold chain is critical in the manufacturing and distribution of pharmaceuticals, for food service products (for restaurants, hospitals and other institutions), and for high-value products such as frozen foods, meats, fruits and fish. Maintaining the integrity of the cold chain also plays a vital role in efforts to comply with stringent regulations for food and drug safety.

Recently, managing the cold chain has become so profitable that some private equity firms are expanding their ownership in some leading third-party cold-chain management providers. Could IPOs be around the corner for some of those firms?

The ‘Missing Link’
As Rubin notes,“The vaccine story is one small part of the cold chain, and the cold chain story is one small part of the supply chain,” which enables many companies to increase their profitability even as they serve customers in ever-more remote locations around the world. Rubin is a director of Energize the Chain, a Philadelphia-based non-profit whose stated goal is to “solve the missing link in the delivery of vaccines to the world’s poorest” by creating “an economically and technologically sustainable energy infrastructure of the effective transportation and storage of vaccines.” How so? By harnessing the energy potential of telecommunications towers that are found in many of the most remote locations where refrigeration is in short supply....MORE