Sunday, July 4, 2021

AstraZeneca did ‘not even try’ to meet Covid vaccine contract, EU tells court


The European Commission has demanded an urgent court order requiring AstraZeneca to deliver millions more vaccines to the bloc or face a hefty fine, in a case that may reflect its anger more than its need for doses.

“AstraZeneca did not even try to respect the contract,” the EU’s lawyer, Rafaël Jafferali, told a court in Brussels on Wednesday, saying the EU wanted €10 per dose for each day of delay as compensation for the company’s alleged non-compliance.

Jafferali said the penalty should apply from 1 July if AstraZeneca did not deliver at least 120m doses by the end of June and that the EU would also seek a penalty of at least €10m for each breach of the contract that the judge may eventually decide.

AstraZeneca supplied only 30m of the 120m Covid-19 vaccine doses it was scheduled to deliver to the bloc by the end of March and had delivered only 50m by early May. It is on course to deliver 70m of a promised 180m in the second quarter.

The commission argued the company should have used all four production plants listed in its contract –including two in the UK – – in line with a “best reasonable efforts” clause, and said 50m doses made in the Britain, the US and the Netherlands that should have been delivered to the EU were “diverted” to other countries.

Jafferali also accused AstraZeneca of misleading the commission by providing it with unclear information on expected delivery delays. “The information provided by AstraZeneca did not allow us to fully understand the situation before mid-March 2021,” he said.

AstraZeneca’s lawyer, Hakim Boularbah, told the court that the contract was “not for the delivery of shoes or T-shirts”, adding that manufacturing a new vaccine was a complex business and the EU’s accusations were “shocking”.

The company has repeatedly said the contract was not binding as it only committed to make “best reasonable efforts”. Jafferali said doses produced in Britain were reserved under a contract the British government signed with the University of Oxford.

Even if the court rules in the commission’s favour, however, it is not clear whether the firm could deliver the missing doses – nor, with alternative vaccine supplies now plentiful, many countries restricting the shot to older age groups and some even donating unwanted AstraZeneca doses, how far the bloc actually needs them.

The EU expects to have received more than 1bn vaccine doses by the end of September, enough to inoculate all eligible adults by the end of the summer rather than the 70% it initially targeted.

AstraZeneca has blamed the shortfall in EU deliveries on production difficulties at its European plants and export restrictions. It insisted last month it had “fully complied” with its contract and described any legal action as “without merit”.

While the EU says the case is only about forcing the drugmaker to deliver what it promised, legal experts have said it seems likely the commission is also venting its anger and aiming to show it is not willing to be taken for a ride.

AstraZeneca may invoke a clause in its contract in which the commission waived the right to sue over any eventual delay in deliveries, although this could be rejected by the court because such a clause – essentially allowing one of the parties to ignore a key part of the contract – is not allowed under Belgian law.

Experts have said that in its ruling, expected by the end of June, the court may refer to the performance of the EU’s other suppliers, all of which have met or exceeded their contract commitments.

After taking delivery of just 106m doses in the first quarter, the 27-member bloc is on course to receive 413m doses in the second and another 529m in the third, mainly from Pfizer/BioNTech, Johnson & Johnson and Moderna.

Fears over a small number of cases in AstraZeneca recipients of a rare blood clotting syndrome have prompted several EU countries – and the UK – to offer alternative shots to younger populations, reducing demand and depressing take-up.

Some countries such as Denmark, which is offering the shot only to volunteers, have cancelled AstraZeneca orders and are donating existing stock. In France, the take-up rate for AstraZeneca is 59.6% against 89% for Moderna and 99% for Pfizer/BioNTech.

EU leaders agreed this week to donate at least 100m doses to poorer nations outside the bloc by the end of the year, with Italy pledging 15m and France and Germany 30m each. Many of the vaccines are likely to be unused AstraZeneca shots.

France on Wednesday trebled the number of doses of the Anglo-Swedish shot it was due to donate next month to the Covax programme backed by the World Health Organization and the Gavi vaccine alliance.



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