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CEIV Workshop

Bogotá, May 29, 2019


CEIV Introduction,
Overview & Next
Step
Ronald Schaefer
Senior Principal
Ronald SCHAEFER
Senior Principal, Consulting
IATA
[email protected]

3
Aim of the presentation

• Understand the risks and the potential gaps along the cool chain and live animal supply
chain

• Learn how IATA’s standards improve the handling of pharmaceutical cargo

• Introduce and provide an update of IATA’s CEIV Pharma Program:

• Introduce IATA’s CEIV Fresh Program:

• Introduce IATA’s CEIV Live Animals Program:

• Seek your input and constructive feedback


4
IATA Competition Law Compliance

Follow the prepared agenda.

Do not discuss:

• Pricing, including fares, service charges, commissions, etc.


• Bids on contracts or allocation of customers
• Geographic/Product market allocations and marketing plans, including
• Expanding or withdrawing from markets
• Group boycotts
• Your commercial relations with agents, airlines or other third parties
• Any discussion aimed at influencing the independent business decisions of your competitors

You will be asked to leave the meeting, and the meeting may be terminated, if the above-mentioned
discussions occur.

Remember: All discussions count, even informal ones outside the meeting

5
Content Page

1.0 Introduction: CEIV Introduction, Overview & Next Step 6


2.0 Standards + Regulations: The nature of the industry requires strong cooperation and 11
IATA as a standard setting organization
3.0 CEIV Pharma is a concerted effort to improve the level of competency, operational 38
and technical preparedness
4.0 CEIV Fresh is a concerted effort to improve the level of competency, operational and 106
technical preparedness
5.0 CEIV Live Animals is a concerted effort to meet environmental demands that impact 151
animal’s welfare and comfort
6.0 CEIV approach, governance, and organization: A partnership model and approach 186
tailored to the needs of the different stakeholders in the value chain with qualified
experts

6
Content

1.0 Introduction: CEIV Introduction, Overview & Next Step


2.0 Standards + Regulations: The nature of the industry requires strong cooperation and
IATA as a standard setting organization
3.0 CEIV Pharma is a concerted effort to improve the level of competency, operational
and technical preparedness
4.0 CEIV Fresh is a concerted effort to improve the level of competency, operational and
technical preparedness
5.0 CEIV Live Animals is a concerted effort to meet environmental demands that impact
animal’s welfare and comfort
6.0 CEIV approach, governance, and organization: A partnership model and approach
tailored to the needs of the different stakeholders in the value chain with qualified
experts

7
What is CEIV?

8
Industry Leverage of Quality & Excellence

9
How can it be implemented?

10
Industry Leverage of Quality & Excellence

11
Content

1.0 Introduction: CEIV Introduction, Overview & Next Step


2.0 Standards + Regulations: The nature of the industry requires strong
cooperation and IATA as a standard setting organization
3.0 CEIV Pharma is a concerted effort to improve the level of competency, operational
and technical preparedness
4.0 CEIV Live Animals is a concerted effort to improve the level of competency,
operational and technical preparedness
5.0 CEIV Fresh is a concerted effort to improve the level of competency, operational and
technical preparedness
6.0 CEIV approach, governance, and organization: A partnership model and approach
tailored to the needs of the different stakeholders in the value chain with qualified
experts
7.0 CEIV approach, governance, and organization: A partnership model and approach
tailored to the needs of the different stakeholders in the value chain with qualified
experts
12
IATA is a Standard Setting Organization
Implementation and dissemination of standards driven by industry

Step 1: Implementation Step 2: Dissemination

Industry feedback driving improvements:


• Need for standardization in safety, Support Adoption
security, operations, e.g. the handling of
pharmaceutical products in air cargo
environment Prove Concept
• Need to enhance partnership and
communication
• Need to ensure appropriate training in Develop
the supply chain Standards

The industry usually asks IATA to address


their needs to ensure compliance and quality services

13
IATA is a Standard Setting Organization
How are standards developed?
Cargo
• Cargo Committee Committee (CC)
• Reports to the Board of Governors
• Develops cargo strategy, positions and plans

• Cargo Procedures Conferences Management Group Cargo Procedures


• Supports Cargo Committee strategy Conferences Management
• Prioritizes, assigns and monitors the activities of Cargo Group (CPCMG)
Services/Agency Conferences

• Cargo Services/Agency Conferences


Cargo Services Cargo Agency
• Cargo Services Conference (CSC) & Cargo Agency
Conference Conference (CAC)
Conference (CAC) develop standards with anti-trust
(CSC)
immunity

14
IATA is a Standard Setting Organization
IATA ensures that both safety and animal welfare are addressed in all regulatory issues
pertaining to transportation of live animals by air

CARGO SERVICES CONFERENCE


(CSC)

Cargo
Dangerous Live Animals and Cargo Border
Airmail Board ULD Board Operations and
Goods Board Perishables Management
(AMB) (ULDB) Technology
(DGB) Board (LAPB) Board (CBMB)
Board (COTB)

15
IATA is a Standard Setting Organization
CARGO SERVICES CONFERENCE (CSC)

CSCRM

Dangerous Live Animals and Cargo Border Cargo Operations


Airmail Board ULD Board
Goods Board Perishables Management and Technology
(AMB) (ULDB)
(DGB) Board (LAPB) Board (CBMB) Board (COTB)

TCR ULDR CIMP & CXML


DGR AHM

PCR LAR

16
IATA a standard setting organization
IATA adopted a supply chain approach by liaising with all stakeholders…

IATA
Cargo Services Conference (CSC)

Live Animal & Perishable Board


(LAPB)

Time & Temperature Working Group


(TTWG)

Temperature
Freight Ground controlled
Shippers Airlines Airports
Forwarders Handlers packaging
suppliers

17
IATA a Standard Setting Organization
…from the health care industry to establish common standards

2007 2010 2012 2014


Perishable Cargo PCR Mandatory Provides requirements +
Regulations (PCR) New Chapter 17 T&T Sensitive standards for
Industry standard New T&T Label transporting pharma
Sensitive Label products

Must be affixed to all


shipments booked as
T+T sensitive cargo

2008 2009 2011 2013


Mandatory
Standard
Checklist

18
IATA a Standard Setting Organization
Ensure that Live Animals Regulations (LAR) are updated

Promote animal care and welfare by keeping the


Live Animals Regulations (LAR) updated.

19
IATA a Standard Setting Organization
The Perishable Cargo Regulations (PCR) is the leader in temperature control and cold chain
management for goods from the food sectors

2007 The PCR includes:


Perishable Cargo
Regulations (PCR) ▪ Up-to-date airline and government requirements pertaining to the
Industry standard transport of perishable cargo

▪ Requirements on handling, marking & labeling

▪ Necessary packaging requirements

▪ Information on the necessary documentation required when transporting


perishable cargo

▪ A comprehensive classification of 100’s of perishable commodities


▪ Whether you are a shipper, a freight forwarder, an airline, or shipper, the
PCR is your essential guide for the for optimizing your time sensitive
supply chain.

20
IATA a Standard Setting Organization
IATA’s Live Animal Regulations (LAR) are already considered the minimum worldwide
standards…
IATA Live Animal Regulations (LAR)
• Live Animal Standards in the LAR are not set in isolation. The
standards are a combination of operational experience and based on
modern science
• Based on input from
• Airline members;
• Industry stakeholders involved with the transport of animals;
• Trade;
• International and national organization;
• Animal care team;
• Advisory panel.

• Provides General Container Requirements such as:


• Construction Requirements
• Ventilation Requirements
• Safety Requirements
• Animal Welfare and Health Requirements
• Food and Water Requirements
• Care and Handling Requirements
21
IATA a Standard Setting Organization
…for transporting animals by air

IATA Live Animals Regulations (LAR)


• IATA’s LAR is the worldwide standard for transporting live animals by
commercial airlines.

• All persons who ship, accept, handle or load animals must be familiar with
the specific handling requirements for the individual species to ensure that
animals always travel in safe, healthy and humane conditions.

• IATA LAR have been adopted by a number of countries as their national


regulations for transporting live animals

22
IATA a Standard Setting Organization
Regulatory authorities make reference to the IATA LAR

International Organization or Governmental Agencies

• The OIE and CITES or USFWS all reference the IATA LAR as the guidelines
that must be followed for the carriage of live animals by air;

• The Canadian Food Inspection Agency (CFIA) requires that all live animals,
including live avian and live aquatic species, transported by air be
transported in containers as specified in the latest edition of the container
requirements of the IATA Live Animals Regulations;

• The European Union has adopted the IATA LAR as the minimum standard
for transporting animals by air that member states need to comply with.

23
IATA a Standard Setting Organization
IATA uses different means to disseminate standards in the industry

PUBLICATIONS

STRATEGIC
PARTNERSHIPS TRAINING
PROGRAM

BUSINESS
EVENTS
INTELLIGENCE

CONSULTING

24
Overview of Export Market in Colombia
In 2018, Colombia exported total value of USD 66.6 billion worth of goods worldwide

Top ten produces in Colombia in 2018


(in millions USD)
Millions • In 2018, Colombia exported total value
0 2000 4000 6000 of USD 66.6 billion worth of goods
worldwide
Crude oil

Coal • Crude oil (6.47% of total export market


Coffee share), coal (5.37%) and coffee
(2.56%) are the top three most traded
Bananas
goods from Colombia
Non crude oil

Ferroalloys • Fresh produces such as bananas and


cut flowers and buds contribute to
Cut flowers & buds
2.03% and 1.28% of total export
Passenger vehicles market share respectively
Waste & scrap of precious metals
• Over the past five years, export of
Cane sugar
bananas increased around 58.7%
Source: CIA Factbook

25
Overview of Import Market in Colombia
15% of Colombian imported goods were transported by air

Major destinations of imports by air in Colombia in 2016

67% Marine
3.1%
5.3%

18% Land 7.6%

10.4%

15% Air 7.8%


65.9%

Bogota Antioquia Atlantico


C/marca V. del Cauca Other

• In 2016, the value of total imports to Colombia was around CIF 44.0Bn – around 55% entered Bogota
• Eldorado airport is the main airport of the country
• Pharmaceutical, technological and machinery products are the three main product groups imported by air
Source: District Department of Planning

26
Overview of Air Cargo Market in Colombia
Colombia is the country with largest share of air trade in South America

Air trade volume in South America in 2017


(% share by country)
3.4% • In 2017, total air trade volume in South
1.4%
America was 927,000 tonnes

• In 2017, Colombia has the largest size


6.5%
Colombia
of air trade market in South America,
25.8%
7.8%
Chile
with a market share of around 25.8%
Brazil
Peru
• Most of Colombian air trade consist of
11.7% goods with destination to North
Ecuador
Argentina
America
Venezuela
24.6% Other
18.8%

Source: Boeing

27
Overview of Pharmaceutical Market in Colombia
The size of Colombian pharmaceutical market was $3.419M in 2017

Pharmaceutical market share in Colombia by company in 2017


(% share)
• The size of Colombian pharmaceutical
market was $3.419M in 2017,
GSK, 12% representing 15% of total healthcare
expenditure of the country or 1.1% of
total GDP
Pfizer, 8%
• Per capita pharmaceutical expenditure
in 2016 was $64
Bayer, 8%
Other, 51%
• Colombian pharmaceutical market is
Tecnoquimicas,
7%
primarily dominated by international
players such as GSK, Pfizer and Bayer.
Sanofi, 7%
However, domestic pharmaceutical
companies started to gain market
Abbott, 7% share gradually.

Source: Procomer

28
Overview of Pharmaceutical Market in Colombia
More than 47% of Colombian imported pharmaceutical products originated from European Union

Import of medical products by origin continent in 2017


(% share)
• Most of Colombian imported
Other, 2%
pharmaceutical products come from
Rest of Europe, European Union (47%), followed by
7%
North America (27%) and Asia (8%)
North America,
South America,
27%
8% • On a country level, United States (18%),
Asia, 8% Germany (17%) and Mexico (7%) are the
largest country providers of medical
products to Colombia in 2017

European Union,
47%

Source: Procomer

29
Overview of Pharmaceutical Market in Colombia
In 2017, Colombia exported around USD 319M pharmaceutical products

Export of medical products by country of destination in 2017 Exports of pharmaceutical products in Colombia
(% share) ($Million of USD, 2013 – 2017)
700

Millions
Other, 15%
600
Costa Rica, Ecuador, 29%
3% 491
500 458 464
El Salvador,
3%
394
Dominican 400
Republic, 4% 319
Guatemala, 300
5%
200
Mexico, 5%
Panama, 12%
100
United States,
6%
Chile, 6% 0
Peru, 12% 2013 2014 2015 2016 2017

Source: Procomer

30
Overview of Pharmaceutical Market in Colombia
Around 19% of Colombian pharmaceutical products were exported by air

Export to Colombia by mode of transportation in 2017


(% share)

Other
El Dorado airports,
Marine Air transport, Airport,
transport, 81% 19% 12%
Bogota,
88%

Source: Pharmaceutical Commerce

31
Overview of Live Animals Market in Colombia
In 2018, Colombia export of live animals were close to USD50M

Top five livestock produced in Colombia in 2017 Colombia animal export by country in 2017
(in thousands) ($ Million of USD)

Millions
0 5 10 15 20 25 United States

Lebanon
Cattle 22.5
Jordan

Russia
Pigs 5.2
Iraq

France
Horses 1.2
Hong Kong, China

Ecuador
Sheep 1.0
Spain

Vietnam
Goats 0.8
0 20 40 60 80
Source: FAOSTAT
Millions

32
Overview of Fresh Product Market in Colombia
Major types of commodities by air from Latin America to North America

Commodities transported by air from Latin America to North


America
• The top three product category
transported by air from Latin America to
North America are all perishable
23.1%
products:
Flowers
27.2%

Fish • Flowers (27.2%)

Fruits and vegetables • Fish (25.6%)


6.7%
Small packages and
shipments
• Fruits and vegetables (17.4%)
Other
17.4% 25.6%

Source: Boeing, flexport

33
Overview of Fresh Product Market in Colombia
Fresh produce exports in Colombia is led by bananas, plantains and pineapples

Top ten produces in Colombia in 2017


(in tons)
• Colombia is the third largest country in
Millions
- 10 20 30 40
Latin America in terms of area of
planted lands for fruits and vegetables
Sugar cane

Oil palm fruit • Fresh produce exports in Colombia is


led by bananas, plantains and
Bananas
pineapples
Plantains and others

Rice, paddy • Fresh fruits with the most growth


potential are avocados (increased by
Potatoes
182% in 2016) and pineapples (241%)
Cassava leaves

Cassava

Maize

Pineapples

Source: FAOSTATS, Oxford Business

34
Overview of Fresh Product Market in Colombia
United States is the largest importer of vegetables produced in Colombia

Colombia export of vegetables by region in 2017 Colombia export of vegetables by country in 2017
($ Million of USD) ($ Million of USD)

Millions Millions
0 2000 4000 0 1000 2000 3000

North America 2,727.5 United States 2,490

Europe &Central Asia 2,090.7 Belgium 412

East Asia& Pacific 498.6 Netherlands 406

Latin America & Caribbean 338.4 Japan 311

Middle East & North Africa 47.8 United Kingdom 276

Sub-Saharan Africa 2.0 Germany 274

South Asia 0.5 Canada 238

Source: World Integrated Trade Solution

35
Case: Colombia Cut Flower Export
Colombia is the world’s second largest cut flower export country

World’s largest cut flower export countries in 2018


(% share)

1%
2% • Colombia is the world’s second largest cut
1% 1% 11% Netherlands flower export country with around 16% market
Colombia share
1%
Kenya
2% Ecuador • In 2018, total export of flowers exported from
Ethiopia Colombia was USD 1.4Bn
9% 48% Malaysia
China • United States is world’s largest importer of fresh
Italy cut flowers – in 2018, total imported value
8%
Belgium reached around USD 8.9Bn
Germany
16% Rest of the world • Around 60% of United States’ imported flowers
were from Colombia

Source: ITC

36
Case: Colombia Cut Flower Export
Top 5 importers of Colombian fresh cut flowers

2.7% • Colombian flowers were distributed


to 89 countries
2.4%
78.4% 2.8%
• 80% of Colombia’s flower exports
3.7%
go through the El Dorado
International Airport in Bogota
Top 5 importers of
Colombian fresh cut
flowers
1. United States (78.4%)
2. Japan (3.7%)
3. United Kingdom (2.8%)
4. Canada (2.7%)
5. Netherlands (2.4%)

Source: ITC

37
Case: Colombia Cut Flower Export
Flow chart for Colombian flowers to United States

Farm Farm truck to Post-harvest Refrigerated El Dorado Airport


post-harvest collection point truck (1 hour) (4 – 8 hours)
collection point

Retailer Refrigerated Miami Airport Airfreight


truck (6 hours) (2 – 4 hours) (6 hours)

Source: Worldbank

38
How to become CEIV
Pharma Certified
Content Page

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of competency,
operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

40
Background: Pharmaceutical Market Development
The global biopharma sales trend is projected to go upwards

Global Biopharma Sales Trend 2014 - 2022


($ Billions)
• By 2022, world sales of cold-chain drugs and
$1,600
$1,430 of biologics will likely top $416 billion, in a
$1,400 $1,310 global biopharma market exceeding $1.43
$1,188 trillion.
$1,200 $1,105
• An expansive future for cold chain logistics
$1,000 is expected (at a 5–6 % growth rate), driven
$1,014
$940 by
$800 $870
$833 • continuing transition to biologically based
$600 products;
$416
$400 $318
$370 • tightening requirements for life sciences
$272
shipments;
$200 • growing internationalization of
$0 pharmaceutical trade;
2016 2018 2020 2022 • continued strong growth in vaccines; and
Cold Chain (+53% growth) Non-Cold Chain (+26% growth) Total (+29% growth) • continued expansion of clinical trials
logistics
• broader adoption in underdeveloped
Source: Pharmaceutical Commerce
economies.
41
Background: Pharmaceutical Market Development
Cold chain logistics spending is expected to be fastest in Asia and in North America

Global Biopharma Sales Trend 2014 – 2022 / Per region


($ Billions)
• With 20% of world’s population, Europe and
North America consume more than 60% of
$20 $18.6 the total pharmaceutical products (in dollar
$18 $16.8 $1.4 terms).
$16 $15.0 $1.2

$14 $13.3 $1.1 $4.7 • If Asia and the rest of the world used
$4.2
$0.9 pharmaceuticals at the same level as Europe
$12 $3.7
$3.3 and North America, the global market would
$10
$6.6 be 3x as large.
$8 $6.2
$5.8
$6 $5.3 • Asia is expected to account for the largest
$4 regional share growth with ~$1.5 billion in
$2 $4.4 $5.2 $5.9 cold-chain logistics spending growth between
$3.8
2018 and 2022.
$0
2016 2018 2020 2022
Asia Europe North America Rest of World
Source: Pharmaceutical Commerce

42
Background: Pharmaceutical Market Development
Spending in biopharma logistics will continue to rise to meet demand

Global Biopharma Logistics Spending (2016 – 2022)


($ Billions)
• It is estimated cold-chain logistics
$93.7 spending in 2018 will be about $15.0
$86.7
$100 $82.3 billion worldwide in a $82.3 billion overall
$73.3 pharma logistics market.
$90
$80 $18.6
$16.9
$13.3 $15.0
$70
$60
• The year-over-year growth rate is ~8% for
cold chain logistics and ~2%for non-cold
$50
chain logistics.
$40
$69.8 $73.1
$66.0 $67.3
$30
$20
$10
$0
2016 2018 2020 2022
Non-Cold Chain Cold Chain

Source: Pharmaceutical Commerce

43
Background: Pharmaceutical Market Development
It is estimated the global industry will spend $15 billion on cold chain logistics in 2018, up from
$10.1 billion in 2015
Estimated Breakdown of Logistics Spending (2015 vs 2018)
($ Billions)
• It is estimated $10.6 billion will be
spent in cold chain transportation

$4.8 $7.0 $4.7


$10.6
• $4.4 billion will be in specialized
tertiary packaging and instrumentation
$3.1 $4.4 such as:
$4.8 $7.0 $3.1 • insulated boxes;
• blankets;
• phase-change materials;
• active temperature-control shipping
$43.1 $62.6 containers; and
$43.1 • various temperature sensors and
recorders.

Cold Chain Transport Cold Chain Packaging • There is a trend towards more
Non-Cold Chain Transport Non-Cold Chain Packaging spending on devices and systems for
Source: Pharmaceutical Commerce
controlled room temp (CRT)
44
Background: Pharmaceutical Market Development
Out of the USD 10.6B, USD 7.8B of Cold Chain Transport Spending will be spent on Air Freight

Estimated Breakdown of Cold Chain Transport Spending By Mode (2018)


($ Billions)

$0.1

$4.7
$2.7
$10.6
$62.6
$7.8
$4.4

Air & Parcel Sea Truck & Multi Mode


Source: Pharmaceutical Commerce

45
Background: Pharmaceuticals Use Air Transport
Pharmaceutical transport by air has shown stronger growth than the air cargo market as a whole
Long Term Air Trade Growth 2000 - 2016 (% CAGR)

5.0% 4.7%
4.5%

4.0%

3.5% 3.4% 3.4%

3.0% 2.7% 2.8%


2.6%
2.5% 2.4%

2.0% 1.8%
1.5%
1.5%

1.0%

0.5%

0.0%
Raw Materials High Tech Machinery Perishables Fashion Chemicals Automotive Pharma Global Air Trade

Source: Seabury Global Trade Database (May 2017)

46
Background: Pharmaceuticals Use Air Transport
The United States is the biggest exporter and importer of pharmaceuticals by air

Pharma Air Trade Destinations JAN-AUG 2017 (Thousand Tonnes)

0 50 100 150 200 250 0 50 100 150 200 250

USA 86 USA 73

India 54 China 23

Germany 33 Japan 13
Export Import
China 20 Germany 13

France 19 Brazil 12

UK 14 Netherlands 9

Belgium 12 India 8

Other 127 Other 214

Source: Seabury Global Trade Database (November 2017)

47
Background: Pharmaceuticals Use Air Transport
Pharmaceutical represent an important and lucrative sector for air cargo, contributing
approximately US$ 1.4 billion to total airline cargo revenue

Pharmaceutical Trade By Air 2017 Per Volume, Airline Cargo Revenue and Value (%)

10.0%
9.0%
8.0%
7.0%
6.0%
5.0%
9.4%
4.0%
3.0%
2.0%
1.0% 2.6%
1.9%
0.0%
Volume Airline Cargo Revenue Value

Source: Seabury Global Trade Database (November 2017)

48
Background: Pharmaceuticals Use Air Transport
Pharmaceuticals shipped under CRT, COL or ACT command an average premium of 25-60%
above the rate charged for the average air cargo shipment on the same country pair
Pharma Rates by Handling Code 2017

2.5

1.5

CRT = Controlled Room


Temperature
1
Avg. Air Cargo Rate = 1 COL = Cool Goods

0.5 ACT = Active Temperature


Controlled

0
Avg. Air Avg. PIL Avg. CRT Avg. COL Avg. ACT
Cargo
Source: IATA Economics

49
Background: Pharmaceuticals Use Air Transport
As a result, pharma air trade growth is based on high value pharma products (> $150/kg)
compared to pharma ocean trade growth which relies on low value products (< $15/kg)

Pharma Trade By Product Value: Air vs Ocean 2000 – 2016 (Thousand Tonnes)

600 6000
188 550 255 73 5,437
AIR OCEAN 586
500 5000
1,792

400 82 4000

300 265 23 3000 2,731

-8
200 2000

100 1000

0 0

Source: Seabury Global Trade Database

50
Content Page

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of competency,
operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

51
Background: Air freight has lost “market share” to ocean freight
Over the past 16 years, ocean pharma trade has added significant volumes particularly in the
mid-value pharma category

Pharma Share: Air vs Ocean


Global Trade of Pharma, 2016 Air Weight Share, 2000 – 2017 (MAR)

30%

Air Share Losing Out to


OCEAN 91% Ocean

70%

AIR 9%
Weight Value

Source: Seabury Global Trade Database

52
Background: Critical Issues Raised by the Shippers
The use of air-mode transportation is re-considered unless industry partners ensure quality
services

Of vaccines reach their destination


25% degraded because of incorrect
shipping
Of scrapped pharmaceuticals can
30% be attributed to logistics issues
alone
Of temperature-sensitive products
20% are damaged during transport due
to a broken cold chain

• Due to a lack of compliance, standardization, accountability and transparency across the air transport
supply chain a majority of all temperature excursions occur while the package is in the hands of
airlines/airports.
• Temperature deviation denature the product, render it worthless and be harmful to the health of the patient.
• Products can be lost, scrapped, returned leading to significant costs.

53
Background: Critical Issues Raised by the Shippers
Looses associated with temperature excursions in healthcare are around a staggering ~USD 35B

Losses associated with temperature excursions


In USD Billion

Total: USD 34.1B


1.00

3.65
2.35
• The average costs of root
15.20 5.65 cause analysis for each
2 excursion can range from $3K
to up to $10K (avg. USD
1.3 6.5K per year)
8.60
Opportunity Labor Costs Direct Labor Costs
Trial Production Costs
Wasted Logistic Costs Replacement Costs Clinical Trial Costs
Root Cause Analysis Lost Product Cost
Source: World Health Organization, Parenteral Drug Association, worldpharmaceuticals.net, cargosense.com, other industrial analysis

54
Air Cargo Industry Concerns and Challenges
Temperature Excursions – Where do they occur?

Origin

Freight Airline
Manufacturer Trucker Airline
Forwarder Cargo Handler

Transfer

Airline
Airline Airline
Cargo Handler

Destination

Airline Regulatory Freight


Airline Trucker Trucker Consignee
Cargo Handler Authority Forwarder

Source: Expeditors Low Risk Medium Risk High Risk

55
Air Cargo Supply Chain Challenges
The process is quite complex and shippers have difficulties to identify stakeholders that meet
standards and regulations

Example of Flow from BRU to SYD


Shipper Forwarder X Forwarder Y Consignee
BRU SYD

Pick-up In Out In Out In

In Out BRU out SIN in out SYD in In Out

Ground handler BRU Airline BRU – SIN - SYD Ground handler SYD

14 milestones from start to end.


HOW CAN YOU MANAGE THIS ?
56
Air Cargo Supply Chain Challenges
Temperature control share of pharma

Temperature management market, 2013-2017


In percentage of total business
• A big share of pharmaceutical shipments in the 15-
25°C segment are shipped as general cargo.
Active Passive
Temp 10% 10%
20%
Control
25% • A significant part of pharmaceutical shipments
30%
45%
requires temperature controlled transport.

• 75% of shipments require passive cooling


90% 90%
General
80% solutions, and
Cargo 75%
70% • 20% require active temperature control.
55%
• Active temperature control solutions demand a
yield premium due to complex requirements.
• Passive solutions drive volume and are less
Pharmaceuticals A B C D E
costly to implement.

Source: Seabury, BRU Cargo

57
Air Cargo Supply Chain Challenges
From origin to destination pharmaceutical products can be exposed to different climates

IN-FLIGHT
Manufacturer & CONDITIONS
Shippers

LOADING
PACKAGING Distributors
& Consignees

Solutions UNLOADING
Providers

Airport AIRSIDE Airport


Origin Forwarders Ground Handlers TRANSPORT Ground Handlers
& Trucking Co’s
Destination Forwarders
& Trucking Co’s
HANDLING HANDLING
HANDLING ROAD ROAD
TRANSPORT TRANSPORT

-10°C +35°C

58
Air Cargo Industry Concerns and Challenges
Heavily regulated industry with no global standards and certification for handling of
pharmaceutical products

Regulations for transporting pharmaceutical


products vary around the world
• Increasing number of regulations around the
world to implement and comply with

• Increasing number of audits

• Airlines, GHAs and forwarders subjected to


multiple audits for handling, transportation
and distribution (e.g. WHO Appendix 5, EU
92/25/EEC, IATA PCR Chapter 17 & TCR)

• No global certification for handling of


pharmaceutical products

59
Shippers Expectations in Cold Chain
Modal shift is a reality because shippers need products to maintain integrity and efficacy during
transportation

• Compliance, standardization, accountability and transparency across


the supply chain

• Properly trained stakeholders on regulations and standards

• Adequately equipped facilities throughout the supply chain

• Global certification for handling of pharmaceutical cargo

• Common audit format to minimize the disruptions and increase


effectiveness

• Ability to easily search and identify stakeholders that meet


requirements

60
More compliance on the horizon?
Growing regulatory environment, higher business complexity and increased focus on
accountability
• Pharmaceutical companies operate in one of the most dynamic environments.

• Changes in regulations by leading bodies such as US Food and Drug Administration (USFDA) and the
European Medicines Agency (EMA) have increased the significance of regulatory compliance
management for drug manufacturers.
• Pharma companies across the globe are compelled to alter their compliance practices to conform to
changes in regulations and stringent anti-corruption laws.

• Historically pharmaceutical industry has been dealing with malpractices across the value chain ranging from
improper branding to masking safety information and disregarding quality manufacturing standards. This has led
to regulators keeping a strict watch on the pharma companies.

• Enforcement agencies the world over have become more active. Any violation of regulatory methods or non-
compliance of standards could tarnish a company’s reputation, risking its future.

• According to the 2014 global survey on reputation risk conducted by Deloitte, reputation problems had a severe
impact on revenue, loss of brand value and regulatory investigations.

61
More compliance on the horizon?
In the US and European markets, companies have become increasingly cautious about
regulatory compliance
Pharma shippers situation Impact on Air Cargo industry

• Leading pharma companies in these markets have • Compliance is a priority for the air cargo sector.
reportedly implemented effective compliance • Air cargo sector performance not encouraging and
management systems internally. increased regulation will continue to contribute to the
compliance challenges facing the industry.

• Pharma companies are realigning their quality and • They will demand the same from their business
compliance structure to conform to the constantly partners.
evolving regulatory guidelines.

• With the FDA and other regulators broadening the scope of • Companies ought to be proactive in setting up stringent
compliance requirements, it helps if companies have a internal controls as part of their commitment towards quality
holistic approach and make regulatory compliance part and compliance.
of their corporate strategy. • Include effective training, proper timely communication,
periodic reviews / follow-up, and support from the top
management.

Challenge Will Regulators focus on aligning country-specific regulatory


frameworks to global standards enabling harmonization of
standards and help companies drive efficiencies?

62
Content

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of
competency, operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

63
Center of Excellence for Independent Validators
for Pharmaceutical Logistics (CEIV Pharma)

Inspired by Shippers, Driven by Industry!


64
Center of Excellence for Independent Validators (CEIV)
Improve together to protect and grow our industry

The solution
The Need
▪ … for more safety, security and  Develop standards with regulators
efficiency
 Train industry stakeholders on standards and
▪ … to raise the bar to (re)gain confidence regulation

▪ … to improve compliance to  Assess operations against standard check list


standards/regulations

▪ … for independent assessments vs.  Train independent validators on standards


self-assessments and regulations

▪ … to identify and recognize the best  Certify and then register best players on a
players publicly website

▪ … to harmonize and reduce the number  Get States recognition to ensure audits are
of audits valid for all

65
Center of Excellence for Independent Validators (CEIV)
Approach of the CEIV programs

EXISTING NEW
1 2 3 4 5
Standards and Training Validation Re-
Regulations
Regulations and Standards (Recurrent Assessment (Audit) & Validation
Training) Award (Re-Audit)*

▪ Advocate for globally accepted standards and regulations


▪ Train instructors on behalf of the airlines, cargo and ground handlers
▪ Manage the pool of qualified instructors
▪ Train the Independent Validators to a common standard and validation methodology
▪ Train operational staff
▪ Run on-site pre-audits to prepare for validation
▪ Conduct the validations
▪ Manage the database of Independent validators
▪ Manage the database of certified companies

66
Center of Excellence for Independent Validators (CEIV) for Pharma
The CEIV Pharma aims to ensure a higher and more consistent level of pharmaceutical handling
through validations with registered independent validators and instructors

EXISTING NEW
1 2 3 4 5
Standards and Training Validation Re-
Regulations
Regulations and Standards (Recurrent Assessment (Audit) & Validation
Training) Award (Re-Audit)*

▪ Advocate for globally ▪ Develop training ▪ Develop pre- ▪ Manage deployment ▪ Manage database of
accepted standards contents validation of validators validated locations
and regulations ▪ Develop assessment assessment toolkit ▪ Audit documentation, and operators
▪ Establish validation criteria for instructors ▪ Develop a standard processes and ▪ Manage re-validation
checklist with and validators exam validation operations schedule
industry ▪ Train instructors, methodology and consistently
▪ Establish industry validators and assessment tool ▪ Manage quality of
steering group industry stakeholders validations
▪ Manage database of ▪ Follow-up
certified instructors ▪ Award and recognize
and validators operators and
locations as "CEIV
Pharma certified"

67
CEIV Pharma
To ensure the integrity of the product throughout the supply chain

OBJECTIVES
Prevent sanitary issues caused by temperature Improve handling of pharmaceutical products and
excursions during transportation. compliance with existing regulations +
standards.

Ensure product integrity

Elevate staff competency levels through efficient and Create a global and consistent certification that
robust training program. industry can rely on.

68
CEIV Pharma Targets
Who does CEIV Pharma target? The supply chain

From point of origin to destination

3 4
Origin
Shippers Ramp/Cargo Airports Consignee
Handlers

1 2 5 6 Destination
Trucking Freight Airlines Ramp/Cargo
Companies Forwarders Handlers

69
CEIV Pharma Standard
CEIV Pharma standard focuses on global coverage and universality

IATA GUIDELINES GOOD LOCAL +


DISTRIBUTION REGIONAL
PRACTICES GUIDELINES

E.g. Singapore

+ + GDP & GDPMDS


or FAGG in
Belgium

CEIV Pharma:
= =
• encompasses various regulations and standards e.g. EU GDP.
• covers GDP requirements.
• aims at covering international standards and country-specific requirements.
• aims at reducing the number of audits or simplifying them.
• aims to align air cargo stakeholders needs.

70
CEIV Pharma Standard
Review, compare against best practice, offer recommendations for change, identify and mitigate
risks, develop implementation plan

Criteria applied Issues tackled


• Quality management • Content of manuals and guidelines
• Personnel • Procedures for Audits
• Training • Procedures for describing packaging
systems
• Documentation
• Acceptance checklist quality and operating
• Infrastructure + equipment
agreements
• Operations
• Packaging requirements
• Complaints, returns and counterfeit
• Documentation & labeling
• Supplier management
• Acceptance & control
• Self-inspections
• Facilities and equipment
• Transportation
• Staff training requirements
• Specific provisions for brokers
• Training adequacy and currency

71
CEIV Pharma Standard
Compliance vs. non-compliance

IMPORTANT

Non-Conformance Ratings:

MINOR non-conformance – minor or less serious non-conformance which is


unlikely to pose a risk to product quality;
-> need to be closed for the CEIV Certification

MAJOR non-conformance – failure to satisfy a key or mandatory requirement


and/or one which may pose a risk to product quality;
-> need to be acted upon for the CEIV Certification.

Recommendations are provided as suggestions for potential


improvements only and won’t be reviewed for CEIV Certification

72
EU GDP – CEIV Pharma Comparison
CEIV Pharma aims at global and consistent assessments specific to air transport

GDP’s are:
▪ in some cases very region centric
▪ not consistent and not transparent GDP
Local
▪ not supported by shippers for air cargo industry regulations
▪ focused on storage of pharma, not transportation
▪ not aligning stakeholders in the supply chain
TCR
▪ ignoring transport in areas such as such as
ground/tarmac transportation and aircraft (un)loading
which are not covered by existing GDPs.

▪ CEIV Pharma focus is placed on unique handling


and storage circumstances that apply to air cargo
transport

73
EU GDP – CEIV Pharma Comparison
CEIV Pharma aims to avoid one of the most “dangerous misunderstandings” of GDP certification

1 4 Gap filled by non- 5


Transport companies
accredited bodies who
face strong pressure to
be listed in the
issue commercial GDP “QP” Certificates from
certificates which are not independent consultants
EudraGMDP Database
compliant as they are are also not valid
of companies meeting
not issued by competent
EU GDP compliance
supervisory authority

2 3 However GDP
As per EU GDP SOLUTION?
Competent Authorities do
Guidelines, only
not typically carry out
competent supervisory
GDP inspections at
authorities can carry
transport companies
out GDP inspections
(shipping companies)
or at airport hubs
Source: GDP Group, 14/10/2015

74
EU GDP – CEIV Pharma Comparison
GDPs assist wholesale distributors in procuring, holding, supplying or exporting medicinal
products, CEIV Pharma focuses on airfreight and temporary storage
EU GDP IATA CEIV Pharma
Wholesale Distribution Authorization CEIV Certification
Wholesalers, 3PL’s with storage activities Supply Chain Stakeholders
Procuring, holding, supplying or exporting medicinal Handling and transporting pharmaceutical products
products by air
EU Guidelines International Regulatory requirements, Regulations
and air freight standards
Encompasses storage and distribution requirements Focuses on air freight and temporary storage
Applied interpreted by each Member States (e.g. Globally harmonized with consistent requirements
warehousing rules)
Accredited service providers will carry out GDP Validation also on air freight operations (e.g.
inspections at transport companies or at airport hubs ground/tarmac transportation and aircraft
(un)loading)
Country specific auditing tools Same Audit Checklist everywhere
Considered as a reference globally Recognition is increasing in the industry

75
EU GDP – CEIV Pharma Comparison
Which compliance recognition program to choose from?

…The one that best meets your needs and


requirements!
• Does your company comply with the required regulations?
• Does your company need a level of recognition?
• Does your company need a WDA (Wholesale Distribution
Authorization)?
• Where in the supply chain is your company?
• Are the activities out of Europe, international, global?
• ......?
Keeping in mind that the industry
is following the same objective…
76
EU GDP – CEIV Pharma Comparison
A collaborative approach is vital

…Patient safety…
It is collaborative responsibility!

77
Content

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of competency,
operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as
processes, train stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

78
Certification Approach and Methodology
IATA will certify companies in several steps

1 3 4
Preparation Assessment Validation

• Assemble team • On-site assessment by • On-site visit by an 5


• Prepare project logistics Independent validator Independent Validator to
Certification
• Assessment versus ensure full compliance with
• Send data and information minimum IATA CEIV the IATA CEIV Pharma
request Pharma Checklist checklist and also review
• Send interview request • Comparison against best the progress made against
sheet for first visit practice recommendations during
• Establish findings and offer the assessment phase
recommendations for • Drafting of report
change
• Develop implementation
plan and secure resources
• Draft gap analysis report
2 6
Additional
Training required for certification Training

79
Training required for certification
Successful completion of the courses is essential for certification

Training required for


certification

Temperature Audit, Quality and


Controlled Risk Management for
Cargo Operations Temperature
Controlled Cargo

Successful completion of:


• 2 key personal on the “audit” training (5 days); and
• 2 competent personal on the “handling” training (3 days).

80
Training
Temperature Controlled Cargo Operations

Training required for


certification

Key topics:
• The regulatory environment
• Overview of the global pharmaceutical industry
• The differences between “ordinary” perishables and healthcare products
• Packaging Technology
• Documentation and Labelling
• Handling Procedures and Acceptance Control
• Temperature Management in the supply chain
• The critical control points and associated risk factors
• Service Level Agreements (SLAs) and Standard Operational Procedures (SOPs)
• Quality Management
✓ 2 competent personnel per station should be trained on the Classroom course

81
Training
Audit, Quality + Risk Mgt. for Temperature Controlled Cargo

Training required for


certification

Key topics:
• The Regulatory framework
• Quality Management System (QMS)
• Audit and Quality Control Principles
• Self assessment and validation
• IATA Time and Temperature Sensitive Audit Checklist
• Effectiveness of risk management control
• Trigger corrective and preventive measures
• Quality Risk Management (QRM)
• Risk assessment, control and management methodology
• Root Cause Analysis and Lean Basics
✓ 2 key personnel per station should be trained on the Classroom course

82
Training required for certification
For both, key personnel vs competent personnel, successful completion of the course is a pre-
requisite for certification

Training required for


certification

Temperature Controlled Audit, Quality and Risk Management


Cargo Operations (3 day for Temperature Controlled Cargo (5
classroom) days classroom)

2 Competent personnel per station 2 Key personnel per station


• Handling manager • QA manager
• Warehouse manager • Pharma product manager
Who? • Shift manager for acceptance, • Station manager
handling, ramp and storage of • Internal Trainer
pharmaceutical goods • …
• Other staff involve in procession
pharmaceutical goods
83
Training Options In-Company vs Training Center

Training required for


certification

TRAINING IN-COMPANY
CENTER TRAINING

$ $$ Cost

4 12 No. of Participants

Inflexible Flexible Location

84
Assessment
Focus is on preparing the organization for validation and creating awareness

Assessment

Raise awareness On Pharma handling requirements

Assess client To identify potential gaps using the IATA CEIV Pharma checklists

Of facilities, staff, equipment, processes, practices, and


Conduct on-site observation
systems

Prepare client For the subsequent validation exercise

Capture and convey ‘lessons


To assist client in achieving "CEIV Pharma Certified" status
learned’ and suggest ‘best practice
Analyze observations
Highlight findings and provide recommendations
and produce report

Collaborative work Helping creating an action plan and project plan

85
Validation
Validate to ensure all requirements are in compliance, …

Validation

Review of progress on action plan

Action
• During the validation, the independent validator will Packages
• Schedule
go through the checklist one more time and also
review the progress made against recommendations
during the assessment phase Actions
• Personnel
• Quantitative
• Qualitative

Implementations

• At the end of validation decision on


whether all requirements have been
fulfilled.

86
Validation
…and gaps as well as recommendations have been implemented

Validation

▪ After 2 months IATA


reserves the right to
request ▪ If the client does not
▪ Client agrees to close ▪ an up-to-date action supply IATA satisfactory
minor findings identified plan, together with information within thirty
during the validation (30) days of IATA
process and recorded as notifying the client, then
▪ the last Self-Inspection
open in the final validation IATA will withdraw its
report and associated
report within a timeframe CEIV Pharma
action plan, as well as
of two (2) months. registration certificate
with immediate effect.
▪ the Minutes of the last
Management Review.

87
Assessment and Validation
Deliverables

Step 1: Assessment Step 2: Validation

• Pharma handling criteria checklist. • Progress report to review the progress made
• Report covering the findings and against recommendations during the assessment
recommendations based on the assessment. phase.
• Implementation plan. • Implementation plan update.
• Report and implementation plan will set out • Recommendation to award certification as "CEIV
assumptions, findings, results, conclusions and Pharma certified" based on satisfactory compliance
recommendations and will specifically: of CEIV criteria.
• Identify critical elements that are not compliant • Presentation of the validation findings to Senior
with national and international Regulations and the Management.
defined CEIV Pharma Handling criteria (e.g. TCR);
• Outline the impact of non-compliance; and
• Identify elements that are inefficient.
• Presentation to Senior Management.

88
Additional Training
Introduction to Time and Temperature Pharmaceutical Products

Additional Training

4-6 hours training. Key topics:


• Pharmaceutical products
• Processes & procedures related to job functions
• Identification and labelling
• Effect of temperature on pharmaceutical products
• Avoidance of counterfeits
• Passive and active packing
• Product security
All personnel involved in handling pharmaceutical products activities per station
should be trained on “IATA Introduction to Time and Temperature Pharmaceutical
Products course“ (or equivalent)) within period of 12 months after the “Certification”

89
CEIV Pharma: Path to Certification
In a nutshell
Step 1 Preparation

Step 2 Training

Step 3 Assessment

Step 4 Validation

Step 5. CERTIFICATION

Step 6 Training (remaining staff)

90
Certification Timeline (general approach)
Over the years we have seen companies completing the process within 6-7 months

4-6 12-26
Preparation Assessment Validation
weeks weeks
2 days on- 2 days on-
site Timeframe site
depends on
results of
assessment.

Additional
Training required for certification Training
4-12 weeks
12 months
• Ideally completed before
after
assessment.
certification
• Needs to be completed before
validation.

91
Certification Timeline (requirement)
Pharma shippers demanded to impose timelines

Not more than 6 months Not more than 12


Mandatory Trainings between latest training Assessment months between Validation
and assessment assessment + validation

• In case companies pass deadline, key


personnel need to take refresher training

Total certification not to last longer than 18 months from last training to certification

CEIV Pharma 92
CEIV Pharma Caveat
Once a client obtains the CEIV Pharma Certificate, IATA or an IATA representative mandated by
IATA will have the right to conduct spot checks to ensure continuing quality of the certification
• Client agrees to close minor findings identified during the validation process and recorded as open in the final
validation report within a timeframe of two (2) months. After two (2) months IATA reserves the right to request an up-
to-date action plan when minor findings identified during the validation process were still recorded as open in the
final validation report, together with the last Self-Inspection report and associated action plan, as well as the Minutes
of the last Management Review. If the client does not supply IATA satisfactory information within thirty (30) days of
IATA notifying the client, then IATA will withdraw its CEIV Pharma registration certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Pharma Certificate still meets the
criteria, IATA reserves the right to require at any time, submission by the client of all required current documentation
and information relating to the certification for IATA’s review and approval. If the client does not supply IATA
satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its CEIV Pharma
certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Pharma Certificate still meets the
criteria, IATA reserves the right to require at any time, submission by the client of all required current documentation
and information relating to the certification for IATA’s review and approval. If the client does not supply IATA
satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its CEIV Pharma
certificate with immediate effect.

CEIV Pharma 93
Recertification
Recertification will take place every three years – includes assessment and one refresher training
plus a validation if necessary

CEIV Pharma
Certified Re-assessment

3 years Max. 2

days

X Close
gaps
Validation

1 - 2 days
REFRESHER TRAINING
• e.g. update on new regulations, development on new
standards, development of new containers, etc.

94
Content

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of competency,
operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

95
CEIV Pharma – Key Benefits
CEIV Pharma is a win-win situation for the industry

Shippers Airlines, GHAs, Forwarders, Airports


• Conduct simpler audits of operators • Protect and grow revenues in fastest growing segment of
• Obtain guarantee that products would be handled in line air cargo
with regulations • Obtain recognition for operations, facilities and staff after
• Experience lower rate of damage and loss due to meeting standards
temperature excursions • Experience simpler audits from various organizations
• Be able to prepare their products ready for acceptance • Promote their best practices to the shipper’s community
• Speak with one voice

Regulators IATA
• Ensure safety of pharmaceutical products shipped by air • Disseminate standards in the industry
• Access to structured and consistent training • Common audit criteria and global certification
• Registry of independent validators and certified • Promote air transport and so limit the modal shift
operators

96
Content

3.1 Introduction: Pharma logistical market growing


3.2 However, air cargo losing market share to other modes of transportation
3.3 Objective: CEIV Pharma is a concerted effort to improve the level of competency,
operational and technical preparedness
3.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
3.5 Benefits: A win-win opportunity for all stakeholders
3.6 CEIV Pharma: Update of activities

97
CEIV Pharma Development
From Pilot to Launch

Launch of
Community
Joint development of Concept at BRU
Community Concept
with BRU

SATS Pilot Official launch of CEIV Recertification of CEIV Pharma


Pharma program program
Discussion
with SATS
about a Pilot

Development of CEIV Pharma Development of CEIV Development of CEIV Pharma Standard Development of CEIV Pharma Standard
Standard 1.0 Pharma Standard 1.0 1.1 and 1.2 + Guidelines 1.3 + updated Guidelines

All companies of the first community will


undergo recertification
Unreliable cargo industry loosing
pharma industry: IATA sleeping
09/13 11/13 01/14 03/14 05/14 07/14 09/14 11/14 01/15 03/15 11/17

98
CEIV Pharma Checklist
CEIV Pharma checklist and guidelines will be included in IATA’s Temperature Control
Regulations as Annex

CEIV Pharma Audit Checklist

CEIV Pharma Audit Guidelines

99
Visibility for CEIV Pharma validated entities
Validated entities are visible on IATA’s website

100
Visibility for CEIV Pharma validated entities
New database combining different IATA certifications under one roof – Coming in 2019

Preliminary layout

101
CEIV Pharma (Certified Entities)
Certified Pharmaceutical Trade Lanes Development

1
11 2 3
21
14 1
2 5 11
11
1
2 12 5 9
29 3 2 4
1 15
8 1 1
2 1 7
1 5
2 3
2 2 2
Locations 10
1
229 Certification Completed 1
1
Certification in Progress 1
+75 (estimate) 1 1 3
1 1
+99 Certification under discussion *
* Estimate

102
CEIV Pharma (Community Approach)
Community Approach Development Worldwide

Location
20 Ongoing Communities

6 Communities in Discussion

103
Endorsement from European Shipping Council

104
Endorsement from Belgian Regulator
On November 25, 2014, the Belgian Regulator FAGG – AFMPS formally endorsed the CEIV
Pharma Program

The Belgian regulator, the federal agency for medicines and health
products (famhp) is endorsing the IATA CEIV program. It has been
involved in the BRUcargo community certification from the start of
the program. Famhp Inspectors have also participated in the
training sessions and workshops.
Josiane Van der Elst, Director General DG Inspection FAGG says
“Although this type of IATA certification is not an authority-issued
regulatory document, initiatives of structured control on transport are
important and welcomed by famhp DG INSPECTION. The IATA
certification gives more confidence that pharmaceutical air freight
shipments are handled in accordance with EU GDP guidelines”.

fagg – afmps, November 25, 2014

105
Testimonials This is not an IATA program. It was drawn up
‘IATA CEIV Pharma is an industry-wide standard that serves as a sign by the pharma shippers and ourselves and
of the commitment we are making not only to our customers but also to disseminated by IATA. The criteria are set by
pharma industry and end consumers. It has been a year since the shippers and ignoring this program is
AirBridgeCargo Airlines have gained IATA CEIV and we were able to ignoring the interests of the pharmaceutical
demonstrate our ability to protect quality, integrity and consistency of industry.”
temperature-sensitive pharma products. Being perceived as an industry Steven Polmans, Head of Cargo, Brussels
benchmark, CEIV raised the bar of our performance, encouraging our Airport
customers’ level of credibility and increasing our volumes, which
constitutes 3% of total cargo carried for 9 months of 2017 – significant
twofold increase as a confirmation of our competency and expertise in
Holistic/community approach
pharma sector.’
is the competitive advantage
Fedor Novikov, Pharma Director, Global AirBridgeCargo Airlines Holistic/community approach
vs other program. The fact
that the program is industry is the competitive advantage
specific is a key differentiator vs other program. The fact
vs GDP. that the program is industry
specific is a key differentiator
Frank van Gelder, Adelantex, vs GDP.
Freight Forwarder
‘it is obvious that we in Duesseldorf engaged for this ever Frank van Gelder, Adelantex,
increasing vertical and are glad to share this with you.. Duesseldorf Freight Forwarder
Airport is situated in one of the most industrialized regions in
Europe where Pharmaceutical Manufacturing plays a vital role!
Ever since we obtained our certification, we saw an increase of
15% of Pharmaceutical Products going through our facilities. The program helps reducing the scope of
“Increasingly, we are seeing more Gerton Hulsmann, Managing Director, Duesseldorf Cargo GmbH shipper audits. CEIV is good sales tool to
shippers requesting for their promote our business to clients: it ensures
pharmaceutical cargo to be routed via IATA a robust cold chain in every step in the
CEIV Pharma certified hubs and trade supply chain through the airport for
lanes.”. handling the pharma shipper’ temperature
sensitive products.
Mr. Lim Ching Kiat, Managing Director, Air
Hub Development at Changi Airport Group Eric Veeckmans, UTi Brussels, Freight
Forwarder

106
How to become CEIV
Fresh Certified
Content

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

108
Economic growth is the main driver behind air freight

20-year forecasts for freight tonnes kilometers from 2017 to 2035


(Index 100)
• Air cargo services are connecting global
markets regardless of the geographic
locations

• The growth for air freight is expected to


double in the next 20 years, and the main
driving force is worldwide economic
development

• Back in 2014, over 80% of worldwide


perishable food is imported by developed
countries. Today with the increase of
income and population in developing
nations, the perishable trades also shift
from developed to developing countries

Source: IATA Economics


109
Demand for fresh products is growing worldwide

Consumer spending on fruit and vegetables by geographic location


(% share)

€ 2.1tn € 4.8tn • Perishable cargos is a general category of


100% air freight that refer to time-sensitive agro-
11% 8%
90% 8% food products and horticultural products
8%
80% such as seafood, meat, fruits, dairy,
16% vegetables and cut flowers
70% 21%
15%
60% • Over the past years, a global surge in
14%
50% demand for premium perishables especially
40% from the Americas, EMEA and Asia Pacific
30%
46%
56% • Global consumption for fruits and
20% vegetables segment alone is expected to
10% reach 4.8 trillion euro in 2030. Asia and
0% Oceania will be the main driver behind this
World 2015 World 2030 growth
Asia & Oceania Middle East and Africa Europe Latin America North America

Source: Oliver Wyman


110
Perishables are the main driver of air cargo

Split of perishable products by type


(% share)
• Global perishables are the main driver of air
9%
cargo. Perishable goods transportation
market expect a steadily annual growth of
7.73% from now until 2022

17% • In January 2019, air transport of perishables


increased 6%. Leading forwarders such as
47% Kuehne + Nagel, Panalpina, DB Schenker
and Newport recorded double digit growth
(between 13 – 16%) in the beginning of
2019

27% • Forwarders and carriers now see ‘high value’


perishables as a prime business, as demand
for such premium products increases around
Fruits & vegetables Fish & seafood Flowers Meat the world
Source: WorldACD, Air Cargo News
111
Perishable export and import worldwide

18%* of North
America’s export to
East Asia were
vegetable and animal
products 26%* of European air
Garments and
trade commodities to
perishables were the
More than 70%* of East Asia are
primary commodities
Latin America’s perishables, such as
exported from Middle
northbound goods fish, meat, fruits and
East to Europe
consist of perishables flowers.

Perishables, e-
African air export is
commerce and
dominated by electronic goods are
perishables
growing strongly in
Intra-Asia and
*Data from 2017 Oceania air cargo
markets
Source: Boeing
Ranking of top 10 countries of origin for perishables by air in 2015

1. Kenya
2. India
3. United States
4. Australia
5. Netherlands
6. Egypt
7. Ecuador
8. Colombia
9. Norway
10. Chile

Source: WorldACD
Flow of perishables by air in key markets

UK
Netherlands

USA
Japan

Colombia
Ecuador Kenya
Peru
Fruits & vegetables
Fish & seafood
Chile
Flowers

Source: WorldACD
Content Page

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

115
Fresh transportation challenges

• Due to the time-sensitive feature of perishable products, from the moment the produce leaves its source, time and
distance are the major challenges faced by the entire fresh supply chain. Fast delivery and efficient coordination
among supply chain stakeholders are the primary objectives

• To preserve the quality and freshness, temperature control is critical– food bacteria grow best between 40 to 140º
F and could double in as short as 20 minutes within this temperature range. Inadequate temperature management
during transit could cause safety issue and spoilage of the produce before reaching the end customer

• Although the carrier might be able to control temperature during transit, in some cases, challenges also occur when
the produce are beyond the shipper’s control – for instance, waiting for custom clearance and inspection at the
holding area

• Transportation of quality control – many fresh products such as eggs are delicate and require specialized
equipment and packaging shipping from the farm to the retailer

• Transportation of perishable involve many stakeholders along the supply chain. Traceability and efficient
communication between different stakeholders during transport lifecycle. Poor communication might result
inventory loss or damage
Source: IATA research
116
Fresh transportation challenges
From the moment the produce leaves its source, time and distance are the major challenges
faced by the entire fresh supply chain
Time before spoilage for different type of perishable produces
(days)
Fish Strawberry

Due to the time-sensitive feature of perishable products, from the moment the produce leaves its source, time and
distance are the major challenges faced by the entire fresh supply chain.

Fast delivery and efficient coordination among supply chain stakeholders are the primary objectives
Source: IATA research
117
Fresh transportation challenges
To preserve the quality and freshness, temperature control is critical

Optimal storage temperature


(ºC)

14 • To preserve the quality and freshness,


temperature control is critical– food
12 Banana, 12 - 16ºC bacteria grow best between 5 to 60º C and
could double in as short as 20 minutes
10
within this temperature range
8
• Inadequate temperature management during
6 Melon, 6 - 9ºC transit could cause safety issue and
spoilage of the produce before reaching the
4
Fish, in melting ice
Lettus, 0 - 2ºC end customer
2 0 to -0.5ºC
• Although the carrier might be able to control
Apple, 0 - 2ºC Dairy, 0 - 2ºC
0 temperature during transit, in some cases,
challenges also occur when the produce are
-2
Fresh meat, -1.5ºC
Poultry, -1.5ºC beyond the shipper’s control – for
Meat product, -2ºC
-4
instance, waiting for custom clearance and
inspection at the holding area
Source: Oxford Journal, IATA research
118
Fresh transportation challenges
Traceability and efficient communication between different stakeholders during transport lifecycle

Transportation of perishable food

• Transportation of quality control – many


fresh products such as eggs are delicate
and require specialized equipment and
Processing Land Cargo Indoor packaging shipping from the farm to the
facilities transportation terminal transfer retailer

• Transportation of perishable involve many


stakeholders along the supply chain. Poor
Unloading Landing Flight Loading communication might result inventory
loss or damage

Indoor Land Distribution


Customs
transfer transportation center
Source: IATA research
119
Shippers Expectations in Cold Chain
Modal shift is a reality because shippers need products to maintain integrity and efficacy during
transportation

• Compliance, standardization, accountability and transparency across


the supply chain

• Properly trained stakeholders on regulations and standards

• Adequately equipped facilities throughout the supply chain

• Global certification for handling of Perishable cargo

• Common audit format to minimize the disruptions and increase


effectiveness

• Ability to easily search and identify stakeholders that meet


requirements

120
Content

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

121
Center of Excellence for Independent Validators
for Perishable Logistics (CEIV Fresh)

Inspired by Shippers, Driven by Industry!


122
Center of Excellence for Independent Validators (CEIV)
Improve together to protect and grow our industry

The solution
The Need
• … for more safety, security and • Develop standards with regulators
efficiency
• Train industry stakeholders on standards and
• … to raise the bar to (re)gain confidence regulation

• … to improve compliance to • Assess operations against standard check list


standards/regulations

• … for independent assessments vs. • Train independent validators on standards


self-assessments and regulations

• … to identify and recognize the best • Certify and then register best players on a
players publicly website

• … to harmonize and reduce the number • Get States recognition to ensure audits are
of audits valid for all

123
Center of Excellence for Independent Validators (CEIV)
Approach of the CEIV programs

EXISTING NEW
1 2 3 4 5
Standards and Training Pre- Validation Re-
Regulations
Regulations and Standards (Recurrent Validation (Audit) & Validation
Training) Assessment Award (Re-Audit)*

• Advocate for globally accepted standards and regulations


• Train instructors on behalf of the airlines, cargo and ground handlers
• Manage the pool of qualified instructors
• Train the Independent Validators to a common standard and validation methodology
• Train operational staff
• Run on-site pre-audits to prepare for validation
• Conduct the validations
• Manage the database of Independent validators
• Manage the database of certified companies
124
Center of Excellence for Independent Validators (CEIV) for Perishable
The CEIV Fresh aims to ensure a higher and more consistent level of Perishable handling
through validations with registered independent validators and instructors

EXISTING NEW
1 2 3 4 5
Standards and Training Pre- Validation Re-
Regulations
Regulations and Standards (Recurrent Validation (Audit) & Validation
Training) Assessment Award (Re-Audit)*

• Advocate for • Develop training • Develop pre- • Manage deployment of • Manage database
globally accepted contents validation validators of validated
standards and • Develop assessment toolkit • Audit documentation, locations and
regulations assessment criteria • Develop a standard processes and operators
• Establish validation for instructors and validation operations consistently • Manage re-
checklist with validators exam methodology and • Manage quality of validation schedule
industry • Train instructors, assessment tool validations
• Establish industry validators and • Follow-up
steering group industry • Award and recognize
stakeholders operators and locations
• Manage database as "CEIV Fresh
of certified certified"
instructors and
validators
125
CEIV Fresh
To ensure the integrity of the product throughout the supply chain

OBJECTIVES
Ensure overall food safety and reductions of loss of Improve handling of Perishable products and raise
products in the air industry. awareness of existing regulations +
standards.

Ensure product integrity

Elevate staff competency levels through efficient and Create a global and consistent certification that
robust training program. industry can rely on.

126
CEIV Fresh Targets
Who does CEIV Fresh target? The supply chain

From point of origin to destination

3 4
Origin
Shippers Ramp/Cargo Airports Consignee
Handlers

1 2 5 6 Destination
Trucking Freight Airlines Ramp/Cargo
Forwarders/Pet
Companies Handlers
Shippers

127
CEIV Fresh Standard
Review, compare against best practice, offer recommendations for change, identify and mitigate
risks, develop implementation plan

Criteria applied Issues tackled


• Quality management • Content of manuals and guidelines
• Personnel • Procedures for Audits
• Training • Procedures for describing packaging
systems
• Documentation
• Acceptance checklist quality and operating
• Infrastructure + equipment
agreements
• Quarantines & complaints
• Packaging requirements
• Supplier management
• Documentation & labeling
• Self-inspections & internal audits
• Acceptance & control
• Transportation
• Facilities and equipment
• Operations
• Staff training requirements
• Training adequacy and currency

128
CEIV Fresh Standard
Compliance vs. non-compliance

IMPORTANT

Non-Conformance Ratings:

MINOR non-conformance – minor or less serious non-conformance which is


unlikely to pose a risk to product quality;
-> need to be closed for the CEIV Certification

MAJOR non-conformance – failure to satisfy a key or mandatory requirement


and/or one which may pose a risk to product quality;
-> need to be acted upon for the CEIV Certification.

Recommendations are provided as suggestions for potential


improvements only and won’t be reviewed for CEIV Certification

129
Content

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as
processes, train stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

130
Certification Approach and Methodology
IATA will certify companies in several steps

1 3 4
Preparation Assessment Validation

• Assemble team • On-site assessment by • On-site visit by an 5


• Prepare project logistics Independent validator Independent Validator to
Certification
• Assessment versus ensure full compliance with
• Send data and information minimum IATA CEIV Fresh the IATA CEIV Fresh
request Checklist checklist and also review
• Send interview request • Comparison against best the progress made against
sheet for first visit practice recommendations during
• Establish findings and offer the assessment phase
recommendations for • Drafting of report
change
• Develop implementation
plan and secure resources
• Draft gap analysis report
2 6
Additional
Training required for certification Training

131
Training required for certification
Successful completion of the courses is essential for certification

Training required for


certification

Perishable Cargo
Logistics
Management

Successful completion of:


• 2 personal on the “audit” training (3 days).

132
Training
Perishable Cargo Logistics Management

Training required for


certification

Key topics:
• How to use IATA’s PCR
• Government and airline regulations
• Shipper’s and airline’s responsibilities
• Documentation and labelling
• Perishable handling procedures
• Damage, claims and tracking
• HACCP-based perishable safety
• CEIV fresh audit checklist

✓ 2 personnel per station should be trained on the Classroom course

133
Training Options In-Company vs Training Center

Training required for


certification

TRAINING IN-COMPANY
CENTER TRAINING

$ $$ Cost

4 12 No. of Participants

Inflexible Flexible Location

134
Assessment
Focus is on preparing the organization for validation and creating awareness

Assessment

Raise awareness On Perishable handling requirements

Assess client To identify potential gaps using the IATA CEIV Fresh checklists

Of facilities, staff, equipment, processes, practices, and


Conduct on-site observation
systems

Prepare client For the subsequent validation exercise

Capture and convey ‘lessons


To assist client in achieving "CEIV Fresh Certified" status
learned’ and suggest ‘best practice
Analyze observations
Highlight findings and provide recommendations
and produce report

Collaborative work Helping creating an action plan and project plan

135
Validation
Validate to ensure all requirements are in compliance, …

Validation

Review of progress on action plan

Action
• During the validation, the independent validator will Packages
• Schedule
go through the checklist one more time and also
review the progress made against recommendations
during the assessment phase Actions
• Personnel
• Quantitative
• Qualitative

Implementations

• At the end of validation decision on


whether all requirements have been
fulfilled.

136
Validation
…and gaps as well as recommendations have been implemented

Validation

▪ After 2 months IATA


reserves the right to
request ▪ If the client does not
▪ Client agrees to close ▪ an up-to-date action supply IATA satisfactory
minor findings identified plan, together with information within thirty
during the validation (30) days of IATA
process and recorded as notifying the client, then
▪ the last Self-Inspection
open in the final validation IATA will withdraw its
report and associated
report within a timeframe CEIV Fresh registration
action plan, as well as
of two (2) months. certificate with
immediate effect.
▪ the Minutes of the last
Management Review.

137
Assessment and Validation
Deliverables

Step 1: Assessment Step 2: Validation

• Perishable handling criteria checklist. • Progress report to review the progress made
• Report covering the findings and against recommendations during the assessment
recommendations based on the assessment. phase.
• Implementation plan. • Implementation plan update.
• Report and implementation plan will set out • Recommendation to award certification as "CEIV
assumptions, findings, results, conclusions and Fresh certified" based on satisfactory compliance of
recommendations and will specifically: CEIV criteria.
• Identify critical elements that are not compliant • Presentation of the validation findings to Senior
with national and international Regulations and the Management.
defined CEIV Fresh Handling criteria (e.g. PCR);
• Outline the impact of non-compliance; and
• Identify elements that are inefficient.
• Presentation to Senior Management.

138
Additional Training
Introduction to Time and Temperature Perishable Products

Additional Training

4-6 hours training. Key topics:


• Perishable products
• Processes & procedures related to job functions
• Identification and labelling
• Effect of temperature on Perishable products
• Avoidance of counterfeits
• Passive and active packing
• Product security
All personnel involved in handling Perishable products activities per station should
be trained on “IATA Introduction to Time and Temperature Perishable Products
course“ (or equivalent)) within period of 12 months after the “Certification”

139
CEIV Fresh: Path to Certification
In a nutshell

Step 1 Preparation

Step 2 Training

Step 3 Assessment

Step 4 Validation

Step 5. CERTIFICATION

Step 6 Training (remaining staff)

140
Certification Timeline (general approach)
Over the years we have seen companies completing the process within 6-7 months

4-6 12-26
Preparation Assessment Validation
weeks weeks
2 days on- 2 days on-
site Timeframe site
depends on
results of
assessment.

Additional
Training required for certification Training
4-12 weeks
12 months
• Ideally completed before
after
assessment.
certification
• Needs to be completed before
validation.

141
Certification Timeline (requirement)
Perishable shippers demanded to impose timelines

Not more than 6 months Not more than 12


Mandatory Trainings between latest training Assessment months between Validation
and assessment assessment + validation

• In case companies pass deadline, key


personnel need to take refresher training

Total certification not to last longer than 18 months from last training to certification

CEIV Fresh 142


CEIV Fresh Caveat
Once a client obtains the CEIV Fresh Certificate, IATA or an IATA representative mandated by
IATA will have the right to conduct spot checks to ensure continuing quality of the certification
• Client agrees to close minor findings identified during the validation process and recorded as open in the final
validation report within a timeframe of two (2) months. After two (2) months IATA reserves the right to request an up-
to-date action plan when minor findings identified during the validation process were still recorded as open in the
final validation report, together with the last Self-Inspection report and associated action plan, as well as the Minutes
of the last Management Review. If the client does not supply IATA satisfactory information within thirty (30) days of
IATA notifying the client, then IATA will withdraw its CEIV Fresh registration certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Fresh Certificate still meets the
criteria, IATA reserves the right to require at any time, submission by the client of all required current documentation
and information relating to the certification for IATA’s review and approval. If the client does not supply IATA
satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its CEIV Fresh
certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Fresh Certificate still meets the
criteria, IATA reserves the right to require at any time, submission by the client of all required current documentation
and information relating to the certification for IATA’s review and approval. If the client does not supply IATA
satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its CEIV Fresh
certificate with immediate effect.

CEIV Fresh 143


Recertification
Recertification will take place every three years – includes assessment and one refresher training
plus a validation if necessary

CEIV Fresh
Certified Re-assessment

3 years Max. 2

days

X Close
gaps
Validation

1 - 2 days
REFRESHER TRAINING
• e.g. update on new regulations, development on new
standards, development of new containers, etc.

144
Content

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

145
CEIV Fresh – Key Benefits
CEIV Fresh is a win-win situation for the industry

Shippers Airlines, GHAs, Forwarders, Airports


▪ Conduct simpler audits of operators ▪ Protect and grow revenues by gaining stake in the
▪ Obtain guarantee that products would be handled in line growing perishable market
with regulations ▪ Obtain recognition and visibility for operations, facilities
▪ Reduce food loss and waste and staff after meeting standards

▪ Be able to prepare their products ready for acceptance ▪ Experience simpler audits from various organizations
▪ Promote their best practices to the shipper’s community
▪ Speak with one voice

Regulators IATA
▪ Ensure food safety along the supply chain ▪ Disseminate standards in the industry
▪ Access to structured and consistent training ▪ Common audit criteria and global certification
▪ Registry of independent validators and certified ▪ Promote air transport and so limit the modal shift
operators

146
Content

4.1 Introduction: Perishable logistical market growing


4.2 Objective: However, air cargo faces several challenges
4.3 Objective: CEIV Fresh is a concerted effort to improve the level of competency,
operational and technical preparedness
4.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
4.5 Benefits: A win-win opportunity for all stakeholders
4.6 CEIV Fresh: Update of activities

147
Visibility for CEIV Fresh validated entities
Validated entities are visible on IATA’s website

148
Visibility for CEIV Fresh validated entities
New database combining different IATA certifications under one roof – Coming in 2019

Preliminary layout

149
CEIV Fresh (Certified Entities)
Certified Perishable Trade Lanes Development

Locations
3 Certification Completed

Certification in Progress
+1 (estimate)

10 Certification under discussion *


* Estimate

150
CEIV Fresh
Pilot Project Status

▪ Pilot is ongoing to determine the feasibility of CEIV


Fresh

▪ Airline, cargo terminal operator and ground handling


agents involvement

▪ Staff from participating companies being trained

▪ Assessment of organization’s documents, processes,


infrastructure and operations

▪ Final validation ensuring that the findings have been


resolved confirming compliance to the program
requirements

▪ Pilot completion expected by April 2019

151
How to become CEIV Live
Animals Certified
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet


booming and profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

153
Live Animal Handling Market Status
Live animals have been transported by air since the early 1930's

Live animals have been transported by air since


the early 1930's. In today's modern world, carriage
of live animals by air is considered the most
Airlines play an important
humane and expedient method of transportation role in this process, offering
over long distances.
the most humane and
Live animals are transported internationally for
expedient way of
many reasons – as livestock, as consumable relocating the animals.
foodstuffs, as pets, for species conservation, etc.

154
Live Animal Handling Market Status
Live animal handling is a competitive yet booming and profitable business

Strong business case for Air Cargo

• Live animal transport by air is a competitive business,


estimated at only 1% of all air cargo
• Costs have risen over the years due to:
• Specialized aircraft (e.g. some freighters can
maintain four different climate zones)
• Specialized facilities (e.g. some airline facility
handled 100 million animals including 80 million
tropical fish and 300 tons of worms)
• Specialized personnel
• Rigorous mitigation procedures in case of
emergency

155
Live Animal Handling Market Status
Whether it is a family relocating with their pet, or a race horse flying to its next event, or even
pandas to support the preservation efforts many species of animals travel through airports and
expectations about their welfare is a priority
• Types of animals transported by air include (but not limited):
• pets,
• service and emotional support animals,
• race horses,
• farm animals,
• research animals,
• Animals breeding or commercial shipment (non-exotic),
• circus and zoo animals, and
• many other assorted land and marine animals.
• Transporting animals by air is essential because of:
• Speed
• Existing international recognized standards and Regulations
• High level of security for high value animals

Transporting live animals by air is a complex and highly planned operation involving various stakeholders in
the supply chain to ensure that animals always travel in safe, healthy and humane conditions as well as to
meet customer’s expectations.

156
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet booming and
profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental
demands that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

157
Why CEIV Live Animals
Industry feedback is driving improvements

Call for more enforcements and compliance with the Live Animals
Regulations as well as quality services!

✓ Reduce Animal Stress, Injury & Death


✓ Improve Compliance with Standards & Regulations
✓ Raise the professionalism in the industry

• Increase standardization in the handling and transport of live animals in the air freight environment
• Provide proper documentation through better expertise
• Enhance communication between stakeholders
• Ensure specialized personnel with appropriate training

158
Why CEIV Live Animals
Concerns Raised by the Industry

• Non Compliance • Lack of knowledge


(e.g. Crates, and experience from
Equipment, the different • Failure to meet environmental
Facilities) stakeholders demands can impact animal’s
welfare

• Critical issues can lead to


animal death

• Emotional loss can lead to


reputational issues

• Lack of recognition and


• Poor Communication • Need to reinforce transparency on handling
and Information Training capability
sharing Requirements

159
Why CEIV Live Animals
An Airport Cooperative Research Program (ACRP) study revealed there are 6 issues that must be
addressed when dealing with live animals at the airport

Relief Areas

Animal Stress
Training Needs
Reduction

ACRP Findings

Proper
Communication Weather-related
with Shippers/ Matters
Travelers
Proper
Documentation

160
Why CEIV Live Animals
The in-flight environment, thermal environment, handling, airport and en-route environments, are
a few of many factor to be considered for safe transport of live animals.

• Outside air temperature - The higher the air temperature, the more time is required to cool the cargo compartment prior to loading
animals.
• Quantity, size, and type of animal cargo - These factors affect the heat load, moisture, and CO2 in the cargo compartment.
• Airplane environmental systems’ capability and configuration - Auxiliary power unit (APU) and air-conditioning performance
are affected by the ambient air temperature relative to ventilation capability.
• Airplane condition prior to loading animals - Heat soak and preconditioning the cargo compartment both affect the amount of
time required for the compartment to reach the desired temperature.
• Time on ground with loaded cargo - The longer the time that the airplane is on the ground with loaded live animal cargo, the
longer the airplane will be required to cool the cargo compartment to a desired temperature.
• Animal packaging and stocking densities -The longer the time on the ground and the duration of flight, the lower the
recommended density of animals in the cargo compartment.

Failure to meet the environmental demands will impact on the


animal’s welfare, comfort and survivability thereby impacting the
operator’s revenue as well as reputation

161
Why CEIV Live Animals
There are a lot of live animal handling regulations out there

Example of Some of the Entities Involved with Transport of


Live Animals in the U.S.

• The U.S. Department of Agriculture has the Animal Welfare Act


(AWA) and the Animal and Health Inspection Services (AHIS) health
regulations for the transport of animals on either public or private
transport.

• The Centers for Disease Control (CDC) sets standards and


regulations for animals imported into the U.S. including vaccination
requirements, disease testing and quarantine.

• U.S. Customs and Border Protection is responsible for allowing (or


barring) entry of animals arriving in the U.S. The CBP serves as a
clearing agent for the federal government by verifying all shipping and
health documents are in order and that the owner/agent asking for
release is a legitimate entity.

• U.S. Fish and Wildlife conducts screenings at certain airports to


ensure the Convention on International Trade in Endangered Species
(CITES) of Wild Fauna and Flora

• Each state has its own criteria and requirements for USDA or
State Governments veterinarian issued certificates
162
Why CEIV Live Animals
There are a lot of live animal handling regulations out there
International Live Animal Inspection
(Examples)

• Certain countries have very specific and strict


live animal handling regulations:

• Australian National Consultative


Committee on Animal Welfare

• European Union Regulation 1/2005

• UKCAA Guidance on Welfare of Animals


during Transport by Air

163
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet booming and
profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental
demands that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

164
CEIV Live Animals
IATA strategy

Strategy Protect the health


and welfare of
animals globally
Promote a uniform Improve animals
approach for the health and welfare
transport of live appropriate risk
animals. management.

Enhance capability of Reinforce trust


modern live animals through transparency
transportation. Strategy and communication.

The strategy includes many steps to improve standards and ensure that they serve their target: the animals
welfare and Health

165
CEIV Live Animals

Objectives
ImproveImprove animal Elevate staff
transportation competency
health of
and
live animals in level through
welfare
compliance with efficient and
appropriate risk
existing regulations robust training
management
and standards. program.

Ensure animal
safety and welfare
Ensure all animals Support andReinforce trust
are transported recognize through
safely and organizations in
transparency and
humanely by air. their compliance with
communication
live animals
regulations.

166
CEIV Live Animals
Who does CEIV Live Animals target? The supply chain

From point of origin to destination


3 4
Origin
Shippers Ramp/Cargo Airports Consignee
Handlers

1 2 5 6 Destination
Trucking Freight Airlines Ramp/Cargo
Forwarders/Pet
Companies Handlers
Shippers

167
IATA combined its own LAR with other local and regional guidelines

IATA GUIDELINES LOCAL + REGIONAL


GUIDELINES

168
CEIV Live Animals: The Standard
CEIV Live Animal Checklist Criteria

Quality Management …  Organization and management


 Key Performance Indicators

Personnel and Training…  Responsible Person


 Training requirements

Documentation…  Infrastructure & Equipment Documentation


 Process Documentation

Infrastructure and equipment…  Premises & Equipment


 IT System, Maintenance

Complaints & Quarantinee  Process implementation

Supplier Management…  Supplier Selection


 Risk Management

Self-inspections…  Process implementation

Transportation …  Information for Road and Air Transport

Operations …  Ground & Tarmac transportation, Acceptance


 Aircraft Loading & Aircraft Unloading

169
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet booming and
profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as
processes, train stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

170
CEIV Live Animals: Project Approach and Methodology
IATA will certify companies in several steps

2 3 4
Preparation Assessment Validation
• Assemble team; • On-site assessment by • On-site visit by an Independent

Validation

Prepare project logistics; Independent Validator Validator to review progress


• Send data and information • Assessment versus minimum made against recommendations
request; IATA Live Animal Audit during the assessment phase.
• Send interview request sheet for Checklist; • Drafting of report.
5
first visit. • Establish findings and offer • Min 6-8 weeks after the Certification
• 4 weeks before assessment. recommendations for change; assessment.
• Develop report, implementation
plan and secure resources.

1 6
Training required for certification Additional Training
Training

• Prepare logistics for in-house or  Train remaining staff.


register for class room session;
• Conduct training and pass exam.
• Before assessment.

171
CEIV Live Animals: Project Approach and Methodology – Training
Ensure that reminder if the staff also get acquainted in the latest of handling Live Animals

Training required for


certification

Facts Upon completion participants will be able to…


• Number of instructors: 1 • Manage technical turnaround of aircraft, coordinating resources
• Duration: 3 days and processes
• Class Size: Up to 20 participants • Apply best practices for safety, punctuality and to be
• Venue: Your Office or IATA training centers commercially successful in aircraft turnaround
• Examination and issuance of Certificate of Completion • Understand and apply safety and punctuality aspects of loading
• Design and offer consistent services according to AHM and I-
Who benefits: Live Animals
GOM standards
• Quality manager Transportatio
• Take a leading role in technical ramp teams
• Station manager n
• Company Veterinarian
• Trainer
• … • Marking and labeling
• LAR, Government and CITES regulations • Acceptance + handling of live animals
• Shipper and carrier’s responsibilities • Loading procedures
• Reservation, schedule and routings • Specific handling procedures
• Animal behavior • Animal health and hygiene
• Classification & nomenclature of animals • Airport handling
• Documentation & responsibilities • Shipment of exotic, laboratory and pregnant animals
• Container requirements • Crisis and delay management
Key topics

172
Assessment
Focus is on preparing the organization for validation and creating awareness

Assessment

Raise awareness On Perishable handling requirements

To identify potential gaps using the IATA CEIV Live Animals


Assess client
checklists
Of facilities, staff, equipment, processes, practices, and
Conduct on-site observation
systems

Prepare client For the subsequent validation exercise

Capture and convey ‘lessons


To assist client in achieving "CEIV Live Animals Certified" status
learned’ and suggest ‘best practice
Analyze observations
Highlight findings and provide recommendations
and produce report

Collaborative work Helping creating an action plan and project plan

173
Validation
Validate to ensure all requirements are in compliance, …

Validation

Review of progress on action plan

Action
• During the validation, the independent validator will Packages
• Schedule
go through the checklist one more time and also
review the progress made against recommendations
during the assessment phase Actions
• Personnel
• Quantitative
• Qualitative

Implementations

• At the end of validation decision on


whether all requirements have been
fulfilled.

174
Validation
…and gaps as well as recommendations have been implemented

Validation

▪ After 2 months IATA


reserves the right to
request ▪ If the client does not
▪ Client agrees to close ▪ an up-to-date action supply IATA satisfactory
minor findings identified plan, together with information within thirty
during the validation (30) days of IATA
process and recorded as notifying the client, then
▪ the last Self-Inspection
open in the final validation IATA will withdraw its
report and associated
report within a timeframe CEIV Fresh registration
action plan, as well as
of two (2) months. certificate with
immediate effect.
▪ the Minutes of the last
Management Review.

175
Assessment and Validation
Deliverables

Step 1: Assessment Step 2: Validation

• Perishable handling criteria checklist. • Progress report to review the progress made
• Report covering the findings and against recommendations during the assessment
recommendations based on the assessment. phase.
• Implementation plan. • Implementation plan update.
• Report and implementation plan will set out • Recommendation to award certification as "CEIV
assumptions, findings, results, conclusions and Live Animals certified" based on satisfactory
recommendations and will specifically: compliance of CEIV criteria.
• Identify critical elements that are not compliant • Presentation of the validation findings to Senior
with national and international Regulations and the Management.
defined CEIV Live Animals criteria (e.g. LAR);
• Outline the impact of non-compliance; and
• Identify elements that are inefficient.
• Presentation to Senior Management.

176
CEIV Fresh: Path to Certification
In a nutshell

Step 1 Preparation

Step 2 Training

Step 3 Assessment

Step 4 Validation

Step 5. CERTIFICATION

Step 6 Training (remaining staff)

177
Certification Timeline (general approach)
Over the years we have seen companies completing the process within 6-7 months

4-6 12-26
Preparation Assessment Validation
weeks weeks
2 days on- 2 days on-
site Timeframe site
depends on
results of
assessment.

Additional
Training required for certification Training
4-12 weeks
12 months
• Ideally completed before
after
assessment.
certification
• Needs to be completed before
validation.

178
Certification Timeline (requirement)
Perishable shippers demanded to impose timelines

Not more than 6 months Not more than 12


Mandatory Trainings between latest training Assessment months between Validation
and assessment assessment + validation

• In case companies pass deadline, key


personnel need to take refresher training

Total certification not to last longer than 18 months from last training to certification

179
CEIV Fresh Caveat
Once a client obtains the CEIV Live Animals Certificate, IATA or an IATA representative
mandated by IATA will have the right to conduct spot checks to ensure continuing quality of the
certification
• Client agrees to close minor findings identified during the validation process and recorded as open in the final
validation report within a timeframe of two (2) months. After two (2) months IATA reserves the right to request an up-
to-date action plan when minor findings identified during the validation process were still recorded as open in the
final validation report, together with the last Self-Inspection report and associated action plan, as well as the Minutes
of the last Management Review. If the client does not supply IATA satisfactory information within thirty (30) days of
IATA notifying the client, then IATA will withdraw its CEIV Live Animals registration certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Live Animals Certificate still meets
the criteria, IATA reserves the right to require at any time, submission by the client of all required current
documentation and information relating to the certification for IATA’s review and approval. If the client does not
supply IATA satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its
CEIV Live Animals certificate with immediate effect.

• In order to determine whether a client and/or station that has received the CEIV Live Animals Certificate still meets
the criteria, IATA reserves the right to require at any time, submission by the client of all required current
documentation and information relating to the certification for IATA’s review and approval. If the client does not
supply IATA satisfactory information within thirty (30) days of IATA notifying the client, then IATA will withdraw its
CEIV Live Animals certificate with immediate effect.

180
Recertification
Recertification will take place every three years – includes assessment and one refresher training
plus a validation if necessary

CEIV Fresh
Certified Re-assessment

3 years Max. 2

days

X Close
gaps
Validation

1 - 2 days
REFRESHER TRAINING
• e.g. update on new regulations, development on new
standards, development of new containers, etc.

181
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet booming and
profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

182
Benefits: A win-win opportunity for all stakeholders
CEIV Live Animals ensures compliance with stringent regulations pertaining to live animal
handling and transport demanded by the industry

Competitive advantage Certainty in compliance


with the IATA LAR

Benefits

Reliability and assurance in


Visibility of credible live animal transport
partners in the supply chain operations for customers
and partners

183
Content

5.1 Introduction: Live animal handling is a competitive and challenging yet booming and
profitable business
5.2 Challenge: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.3 Objective: CEIV Live Animals is a concerted effort to meet environmental demands
that impact animal’s welfare and comfort
5.4 Approach and methodology: Validate knowledge, facilities, as well as processes, train
stakeholders and recognize compliance
5.5 Benefits: A win-win opportunity for all stakeholders
5.6 CEIV Live Animals: Update of activities

184
Certified Entities
“Customers will be looking for


end-to-end excellent service which they
HARC certificate handover can appreciate if everyone in
with Alexandre de Juniac
the supply chain has done the

CEIV program”

Tristan Bradfield,

Heathrow Animal Reception Centre

185
(HARC)
“It’s important that our customers know we’re Certified Entities
handling their pets in a very high, regulated and

prescribed manner and they can absolutely be First Airline to be certified

certain that their animal will be cared for. Air Canada


Having achieved a CEIV certification let’s

them know that we are at the top of our

game and at the top of anyone in the

world’s game.”

Tim Strauss, Air Canada Cargo


First Airline to Achieve CEIV Live Animals Certification
CEIV approach, governance, and
organization: A partnership model and
approach tailored to the needs of the
different stakeholders in the value chain
with qualified experts
CEIV Pharma Certification Approach
There are different approaches to obtain certification

Individual Community Coalition

• One company • A group of • A group of


decides to get "CEIV companies at one companies decide to
Pharma Certified“ airport decide to get get "CEIV Pharma
"CEIV Pharma Certified" at several
• One or several Certified" airports to form
stations several “pharma
• Form a “pharma gateways”
gateway”
• Supply chain
• Supply chain approach
approach

188
Project Governance
Everyone in the value chain can participate in the certification process
Project structure - Who is involved and who can participate?
Example (BRU Cargo)
Pharma shippers

Forwarders with pharma focus

Handlers

Truckers
Facilitators

Airlines

Regulators

TTTF
189
Advocacy
Strong emphasis on engaging stakeholder and advocate for endorsement and recognition

WHO? TASK
Industry
• IATA Live Animal and Perishable Board (LAPD) • Approve standards + guidelines
• Time and Temperature Working Group (TTWG) • Approve trainings
Global • WHO • Global Shippers Forum (GSF)
• FIATA • Cool Chain Association • Endorse + recognize
• TIACA • Pharm.Aero standards

Regional
• EU
• Pharmacopeia
• Endorse + recognize
trainings
Local
• Local stakeholder associations
(Shippers, Freight Forwarders, Ground • Endorse + recognize
Handlers, Airlines) trainings
• Local BARs

190
Advocacy
Strong emphasis on engaging stakeholder and advocate for endorsement and recognition

WHO? TASK
Industry
• IATA Live Animal Board • Approve standards + guidelines
• Approve trainings
Global • WTO • FIATA
• TIACA • Endorse + recognize
• ACI standards
• GSF
Regional
• EU
• FDA
• Endorse + recognize
trainings
Local
• Local stakeholder associations
(Shippers, Freight Forwarders, Ground • Endorse + recognize
Handlers, Airlines) trainings
• Local BARs

191
Advocacy
Strong emphasis on engaging stakeholder and advocate for endorsement and recognition

WHO? TASK
Industry
• IATA Live Animal Board • Approve standards + guidelines
• Approve trainings
Global • WHO • FIATA
• TIACA • Endorse + recognize
• CITES standards

Regional
• CDC
• USDA
• Endorse + recognize
trainings
Local
• Local stakeholder associations
(Shippers, Freight Forwarders, Ground • Endorse + recognize
Handlers, Airlines) trainings
• Local BARs

192
CEIV Pharma – Who is auditing/training?
Qualification and management of independent validators

Qualification Management

▪ IATA conducts preliminary ▪ IVs are registered in IATA


interview with candidate to pre- database and available to complete
qualify candidate for training the assessments and validations

▪ IVs must undergo IATA training ▪ Coordination of IVs is managed


by the IATA team for assessments
▪ IVs need to complete trainings and validations
within six months
▪ IV cannot have been in a
▪ IV’s can also become instructors commercial relationship with
but need to undergo the IATA entity to be validated 12 months
Train-the-trainer course (optional) prior to the engagement

193
Organizational Chart
How is CEIV Pharma organized?

Frederic LEGER Laurent DELARUE

Head QM
Ronald SCHAEFER Independent
Validator

Compliance Standards Training


Ronald SCHAEFER Andrea GRUBER Yaniv SORANY

Validators Instructors
Person X Person X

Person Y Person Y
External

194
Organizational Chart
How is CEIV Fresh organized?

Frederic LEGER Ronald SCHAEFER

Head QM
TBD Independent
Validator

Compliance Standards Training


Ronald SCHAEFER Andrea GRUBER Yaniv SORANY

Validators Instructors
Person X Person X

Person Y Person Y
External

195
Organizational Chart
How is CEIV Live Animals organized?

Frederic LEGER Ronald SCHAEFER

Head QM
Maria Jitomirski Independent
Validator

Compliance Standards Training


Ronald SCHAEFER Andrea GRUBER Yaniv SORANY

Validators Instructors
Person X Person X

Person Y Person Y
External

196
Transforming Challenges into Success
The importance of partnerships
Thank you

 Ronald SCHAEFER
[email protected]
 www.iata.org

198

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