UPS and CVS Health signed a letter of intent to explore drone deliveries, expanding UPS' sights from hospital campuses to the homes of CVS customers as it builds out its drone delivery subsidiary.
UPS Flight Forward, which UPS claims is the country's first fully certified "drone airline," already delivers lab samples by drone at WakeMed Hospital in Raleigh, N.C. The hope is that it can deliver supplies quicker and more cost-effectively within health system networks as well as from the pharmacy to peoples' homes.
"The starting point has been hospitals," said Dan Gagnon, vice president of UPS' healthcare and life sciences group. "Business-to-consumer moves will come, but the regulations have been easier to comply with for business-to-business moves."
Typically, drones transport samples within hospital networks through repeated routes with fixed, secured drop-off locations.
Medical professionals pack a secure container weighing up to 5 pounds and the drone will then fly autonomously along a predetermined flight path to its destination that must be less than 12.5 miles away, UPS explained. Military-grade drones can carry much more weight and travel much further, and that technology will likely eventually expand to healthcare, Gagnon noted.
Things get more complicated with home delivery, and UPS said that it is currently working with government agencies to expand the current regulations that restrict residential drone deliveries to a test environment. Each primary and alternative route to residences would need to be verified.
Supply-chain consultant Jamie Kowalski raised concerns about hacking or intercepting drones, weight and size limitations, identification verification, tracking, increased drone traffic and costs.
"Each transaction may be efficient, but the volume could add up with patients who are on 13 different drugs," he said.
Organizations like UPS, Amazon and a variety of tech startups are looking to tap into the drone delivery industry. Although drones may accelerate delivery and lower overhead, healthcare poses a unique challenge as it relates to privacy, climate control and other hurdles, experts said.
As part of Monday's announcement, UPS also unveiled plans to work with the University of Utah Health, which aims to deliver samples and other cargo by drone by the fourth quarter of this year, similar to the WakeMed arrangement.
Early results from the WakeMed alliance indicate that delivery times for relatively short trips were reduced from 19 minutes to 3 minutes, Gagnon said.
"Turnaround time is everything," he said. "The faster blood and tissues can get back to a lab, that can affect diagnoses and help healthcare professionals work the case faster."
UPS is also partnering with wholesale pharmaceutical distributor AmerisourceBergen to transport certain pharmaceuticals, supplies and records to medical campuses across the country.
The logistics company will soon develop drone delivery services for Kaiser Permanente, UPS said.
Meanwhile, UPS said it is improving its sensing and monitoring technology solutions to meet the needs of healthcare organizations. All UPS healthcare operations will align under a dedicated healthcare and life sciences unit that has a uniform quality management and certification system, UPS said.
Those efforts are part of a companywide retrofit of the UPS network with smart, "internet of things" systems to track healthcare packages. It is scheduled to come online in the first quarter of next year.
Last month, UPS Flight Forward, earned Part 135 Standard certification from the Federal Aviation Administration, which lifts restrictions on how many drones the company can deploy and the weight of cargo onboard the drones.
In the not too distant future, public parks may have secure drop-off zones that could deliver blood during a major disaster or catastrophe, Gagnon said.
"I do see the (healthcare drone delivery space) broadening—at what pace I am not sure," he said.