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Cardinal Health to Test Drone Delivery to Pharmacies

Wall Street Journal

Cardinal Health to Test Drone Delivery to Pharmacies

Cardinal Health Inc . plans to test the use of drones to speed delivery of pills, inhalers and other items to U.S. pharmacies, a move the healthcare-supplies distributor said could also cut transport costs for time-critical shipments.

The pilot program with drone operator Zipline International Inc. would start next year outside Charlotte, N.C., pending approvals from the Federal Aviation Administration , the companies said Tuesday. Aerial drones with 11-foot wingspans would carry loads of up to four pounds about 10 miles from a Zipline distribution center in Kannapolis, N.C., to local pharmacies in 15 to 30 minutes. Cardinal declined to name the pharmacy company participating in the program.

The program is Cardinal Health ‘s first foray into drone deliveries, which the Dublin, Ohio-based distributor sees as a way around delays in restocking inventory and volatile last-minute shipping prices. It follows other efforts by companies including United Parcel Service Inc ., Merck & Co . and Walmart Inc . testing the use of drones for the domestic shipment of medical products and supplies.

Josh Dolan, Cardinal Health’s senior vice president of pharmaceutical operations, said drone delivery would allow the company to bypass road obstacles such as natural disasters and help replenish high-turnover items. Eventually, he said, it will be useful for emergency situations in remote areas or when time is crucial, such as delivering antivenom for snake bites.

While speed and reliability are the main reasons Cardinal Health is pursuing drone delivery, the flights would also allow the company to avoid fluctuations in prices for last-minute courier or helicopter deliveries, Mr. Dolan said. The company eventually aims to expand the program to more products and regions, which would also depend on FAA approvals, a spokesman said.

Zipline, which is based in South San Francisco, Calif., has used aerial drones to deliver medical supplies to remote parts of Africa, flying blood and vaccines to outposts in Rwanda and Ghana and more recently delivering the coronavirus vaccine developed by Pfizer Inc . and BioNTech SE in the latter country.

The company is rolling out its drone deliveries in the U.S. and elsewhere, said Conor French, Zipline’s general counsel. It has announced deals to deliver merchandise for Walmart in northwest Arkansas and to deliver prescriptions and medical supplies for hospital system Intermountain Healthcare in Salt Lake City.

The program with Cardinal Health would use drones that are about six feet from head to tail and resemble miniature planes. They would travel 300 to 400 feet above the ground over a variety of terrains and drop packages with parachutes into landing zones about two parking spaces wide.

Zipline’s drones can travel up to 100 miles round trip, or 50 miles from the distribution center. The company is still working out routes with aviation regulators, a spokeswoman said. Cardinal Health plans to stock and replenish products daily from its distribution center in Greensboro, N.C., about an hour’s drive away.

Mr. French said Zipline’s deal with Cardinal Health is “similar to what we’re doing internationally.” He declined to describe the financial details of the arrangement.

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