German va-Q-Tec stays cool as demand for Covid vaccines rises



Keeping Covid-19 vaccines cold for transport around the world has proven to be a technological challenge during the pandemic. But a small German company thinks it has found the best solution.

Joachim Kuhn, chief executive of va-Q-Tec, says his super-insulated containers have been used to transport between a quarter and a half of the world’s coronavirus vaccine doses, spawning a boom in orders that were already increasing by 30% per year. year.

Sitting in his office overlooking the terraced vineyards that surround va-Q-Tec’s headquarters in Würzburg (pictured above), northwest Bavaria, Kuhn says the pandemic has been a game-changer for the company, prompting it to increase its factory workforce by 50 percent, switch to non-stop production and expand into Asia. “We had to go from five days a week to seven days a week, 24 hours a day,” he says. “It was a bit difficult for our people here. We had to convince them to come also on Saturdays and Sundays, even at night.

Thanks to their efforts, the company now has a factory filled with rectangular silver panels of various sizes. They provide a form of vacuum insulation and work much like the Original thermos which was itself patented by another German in 1904. Glossy panels are made by wrapping silica or similar substances in multi-layered plastic film before baking it to remove water and then sucking in air . When built into the walls of a container, like the refrigerator-sized boxes that va-Q-Tec makes to fit in aircraft cargo holds, the panels keep the contents at a stable temperature for at least five days and up to two weeks without an external power source, even if they are open.

Vacuum insulated panels from Va-Q-Tec © Johannes Kiefer

Va-Q-Tec switched to 24/7 production to respond to pandemic orders © Johannes Kiefer

Staff and visitors to its offices are offered cold drinks in smaller versions of the boxes, which are found around several of its rooms. The company often shows off its technology by transporting blocks of ice to meetings with investors.

The requirement that coronavirus vaccines – such as those produced by BioNTech / Pfizer and Moderna – be stored at temperatures of around -20 ° C underscored the need for technology such as that produced by va-Q- Tec. Cold storage and transport are a big part of the cost of immunization programs and getting it right turned out to be difficult in the past. The global pharmaceutical cold chain storage market was valued at $ 13.3 billion last year and is expected to grow 7% per year even before the launch of the first Covid-19 vaccine in late 2020, according to Imarc research group.

Kuhn clearly takes a kick when he sees vaccines delivered in va-Q-Tec’s containers on TV or the internet. He holds up his phone to show an email regarding such a vaccine delivery from Japan to Brunei, adding that his boxes have been used by the US armed forces in inoculating troops at bases around the world.

Joachim kuhn

Joachim Kuhn, CEO of va-Q-Tec © Johannes Kiefer

As he expresses his joy at the company’s recent success, he reflects on how it nearly collapsed just a few years after he and other thermal insulation students founded it as a company. derived from the university in 2001.

“We went through everything you could have gone through,” he explains, explaining that one of the three founders quit very early, then his first three customers collapsed, leaving him few orders for his insulation panels. innovative. “We were a little too early on the market,” adds Kuhn.

“There were situations where the big orders that we expected didn’t arrive – these were really tense situations,” he says, remembering that the company only had € 2 million in capital and was still located in a basement of ZAE Bayern (the Bavarian Center for Energy Research Application) in Würzburg. “And we were students, so we didn’t have a lot of money.” A lifeline has come from the German biotech industry, namely a deal with Boehringer Ingelheim. “They suddenly realized that this biotech product had to be shipped at very, very controlled temperatures,” Kuhn recalls. “Then we went in and started playing the game.”

Stocks of panels for insulated containers © Johannes Kiefer

A few years later, when the company had grown and needed to raise more funds, it turned not to German investors but to Zouk Capital, a British cleantech fund. “There is more vision in London,” says Kuhn. “It’s the main thing, not the money.”

It soon became apparent that many va-Q-Tec customers preferred to lease their containers rather than buy them. The company has therefore changed its economic model. Inspired by its Swedish rival Envirotainer, which has long rented what Kuhn calls “flying refrigerators” because they depend on battery power, va-Q-Tec has started its own container rental. It has opened a UK office in Kent where a team manages its fleet of 8,000 containers and crates. This “temperature chain as a service” generates around three quarters of the company’s turnover, which is expected to total € 100 million this year.

The pharmaceutical sector has long been its main market, although its biggest customer is Dutch chipmaker ASML, which uses va-Q-Tec’s containers to transport the heat-sensitive lenses used in its semiconductor manufacturing machines.

A box of medical supplies designed for last mile or lab distribution

A box of medical supplies designed for last mile or laboratory distribution © Johannes Kiefer

When the pandemic hit last year, Kuhn says he didn’t see it as an opportunity, but only a source of trouble. His “biggest headache” was how to keep production going while making sure staff were left behind and tested safely. Va-Q-Tec’s panel orders were hit as industrial customers shut down factories during shutdowns. Business with pharmaceutical groups also fell initially as they cut back on other clinical trials to focus on Covid-19.

But, in April 2020, Kuhn got a call from his team in Seoul. It was good news. “A Korean company managed to make test kits on a large scale, and they had to be shipped at -20 ° C to many other countries,” he says. Va-Q-Tec won this order, along with others for coronavirus testing kits before they started to be manufactured on a more local basis.

Demand for the transport of vaccines began last October, when vaccines were in storage prior to regulatory approval. In the first six months of this year, vaccine shipments have skyrocketed, generating 13% of va-Q-Tec’s revenue.

The company’s role in transporting coronavirus vaccines has raised his profile – Kuhn says he’s sometimes asked about the company’s stock price as he walks to the local bakery in Würzburg . The company now has four times as many shareholders as it did before the pandemic and its share price has tripled in less than two years, but Kuhn jokes that if he falls he may have to stop buying gold. bread.

Roland Caps, va-Q-Tec co-founder with Kuhn, recently retired as head of research and development, but his family and Kuhn’s still own 27% of the company, which has gone public. in 2016.

Kuhn predicts that demand from pharmaceutical companies will continue to increase as they develop more temperature-sensitive drugs. In anticipation, va-Q-Tec is expanding rapidly, opening sites in China, India and Brazil and a new production hall at its site near the German city of Erfurt.

An even greater opportunity could come from efforts to tackle climate change, he predicts, demanding that everything from buildings to cars become more energy efficient.

Va-Q-Tec panels were chosen for the insulation of part of the Frankfurt Grand Tower skyscraper which was completed last year and they are used to increase the range of an electric car prototype.

“It’s been fun,” says Kuhn, looking back over the past 20 years since the company was founded. “We are happy to have done two things for humanity: by helping both the climate and the health. It kind of makes us proud.



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