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Biopharma fueling boom in refrigerated warehousing

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Pharmaceutical and biotech firms long ago outsourced transportation of their bio material and finished drugs.

Outsourcing management and storage of samples they collect for clinical trials and other work—not so much.

Until now. In the past few years, a handful of cold storage facilities have sprouted locally by playing to Indianapolis’ strengths in warehousing and life sciences.

Companies such as BioStorage Technologies Inc. have helped pioneer and define the emergence of third-party cold-chain storage for the pharma and biotech industries.

BioStorage, launched in 2002, moved into a warehouse near Indianapolis International Airport and proceeded to arrange not only transportation but also storage of samples of various biomaterials companies used as part of the drug discovery process.

Temperature regulation, tracking and monitoring are pursued to a maniacal degree that would’ve sent W. Edwards Deming to the floor, curled up in a fetal position.

One BioStorage client, a drug company, learned the hard way by not preserving samples—and getting slapped by the U.S. Food and Drug Administration.

“A repeat trial could have been avoided … They ended up third to the market” at a loss of $800 million, said Lori Ball, senior vice president of BioStorage.

Cold chain biopharma doesn’t make news like life sciences companies in breakthrough medical research. But in an era of rising thefts of refrigerated pharmaceutical products, they consider themselves lucky if they can stay out of the headlines.

The firms are highly regulated and work with excruciatingly tight tolerances for temperature maintenance and documentation. Their clients range from drug companies to medical-device makers that prefer anonymity.

Occasionally, the veil is lifted. For example, BioStorage Technologies let it be known it has most of the clinical trial sample repository of Massachusetts-based Biogen Idec, the world’s third-largest biotech company.

BioStorage also bar codes, labels and stores blood bio samples for Minneapolis-based Medtronic Inc., one of the biggest makers of defibrillators. The samples are a key in Medtronic’s investigation of genetics in life-threatening heart arrhythmias.

Now with about 75 employees, BioStorage claims to have the world’s largest purpose-built clinical trial repository. It also has a facility in Germany.

Companies like BioStorage show transportation and life sciences meld naturally in Indianapolis, said Indianapolis Airport Authority Air Services Director Christofer Matney.

“When you mix the two together, what you have is life sciences logistics,” said Matney, who’s attempting to lasso more cargo airlines to serve the niche.

Pharmaceutical expertise

Another cold chain biopharma company rising within the footprint of Indianapolis International reflects the pharmaceutical roots of many of the companies.

Sentry BioPharma Services Inc. stores and ships drug ingredients, clinical trial materials and commercially approved products from its 53,000-square-foot facility. The company was co-founded four years ago by CEO Jennifer Marcum, who worked in temperature-sensitive projects for Baxter Pharmaceutical Solutions LLC.

cold storageSentry holds part of the Centers for Disease Control and Prevention’s national strategic reserve of influenza vaccines—a coup and vote of confidence in the 25-employee company.

Drug companies were beginning to outsource parts of their cold-storage chains when Sentry was started, but “expertise didn’t exist, particularly on the larger scale,” Marcum said.

Expertise at cold-chain logistics firms is more critical than ever as government regulation has tightened in recent years. Today, the FDA “is paying a lot more attention” to the chain of custody a biomaterial or drug flows through, said BioStorage’s Ball.

So highly regulated is the supply chain, from manufacturing to delivery, that BioStorage runs its new freezers and refrigerators through a four-step validation process before putting them into service.

The warehouse could pass for a semiconductor factory.

A software program coupled to sensors measures temperature every 10 minutes and beckons employees with an alarm if conditions stray beyond parameters. Employees flutter about in white lab coats and sterile gloves.

These firms must maintain samples and drugs at precise temperatures and humidity levels while contending with strict security measures.

“This product can’t move with any errors,” said Matney, the airport authority executive. “Sometimes it’s even a life-critical product.”

And expensive. Plainfield-based MD Logistics Inc. faced a nightmare scenario in 2007 involving more than $30 million of insulin.

Thieves made off with tractor trailers operated by Plainfield-based Daum Trucking Inc. that had been loaded in anticipation of being taken to destinations right after Thanksgiving Day.

Bristol-Myers Squibb Co. claimed MD was responsible, and sued. Court documents suggest the parties are in settlement talks.

MD Logistics CEO Mark Sell declined to be interviewed, citing concerns of customers for confidentiality and security. In recent years, the company had about 120 employees and revenue of more than $35 million.

Trends driving sector

The segment is poised to continue growing.

One reason is the rise of biopharmaceuticals, which are proteins and nucleic acids typically created by genetic engineering.

Proteins must be kept at stable temperatures and constant humidity to work well, so many are delivered to patients in refrigerated, injectible forms.

“I think you’re seeing growth in cold chain because more of the products are moving toward that” form, said Brian Stemme, BioCrossroads project director.

Another trend revolves around the ability to apply genetic discoveries toward making so-called personalized medicines—or those tailored toward patients with a particular genetic makeup.

A lot of drug developers are storing samples longer term, hoping science will “catch up,” Ball said. “The samples we’re storing are being used for that intelligence.”

Indianapolis is home to FedEx’s second-largest air hub, which is used by many cold chain providers to move product via its 100 daily flights here.

Indianapolis International has other cargo carriers specializing in temperature-controlled movement such as Cargolux and Pace Air Freight.

Cargolux started flying between Indianapolis and Europe four years ago with a Boeing 747. It now has two daily flights.

Matney would like to land at least one more cargo flight at Indianapolis this year, particularly in the temperature- and time-sensitive niche. He’s been busy trying to build awareness of Indianapolis as an uncongested and safe airport to operate cold storage cargo, one with ample space to grow.

The chilled goods Cargolux hauls through Indianapolis are managed by German logistics firm Schenker at a facility inside the former United Airlines maintenance hub at the airport.

Indeed, if there’s a symposium on air cargo, Matney is probably there. He serves on the International Air Transport Association’s Air Cargo Time & Temperature Task Force, with Indianapolis International the only airport to be a member.

He also helped put together the Midwest Healthcare Supply Chain Conference, which meets this month for the second year in Indianapolis, as a way of putting the region on the map.

“We’ve created our own little niche, our own little supply chain,” Matney said.•

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