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The European Commission is set to receive more doses of the AstraZeneca vaccine – with an edge of revenge.
The fight escalated this week when the EU executive dragged AstraZeneca to court to ask the company to send a liquid vaccine, or “drug substance,” from two UK production sites in under the EU contract. The real confrontation will take place on May 26, during a hearing day in Brussels.
Regardless of whether the court rules in favor of the Commission, however, the EU lawsuit could be as much about showing that it won’t be rushed by a pharmaceutical company as it is about securing the doses.
As for AstraZeneca, it could try to get the case dismissed on the grounds that its contract with the Commission explicitly states that the EU will not sue for delivery delays.
A provision of the contract states that the Commission and the participating Member States “waive all claims against AstraZeneca arising out of or relating to… delays in the delivery of vaccine under this agreement”.
The fact that the Commission moved the case forward shows how furious EU officials are at the company’s inability to deliver millions of doses – and how much the negotiations have deteriorated to the point where that they seem irreparable. There is an added touch of irony that the Commission is essentially breaching its contract with AstraZeneca to sue AstraZeneca for breaching its contract.
“What the EU wants is more distribution of more doses as soon as possible, and litigation is probably not the ideal way to find out,” said Carl Tobias, professor of law at the ‘University of Richmond in Virginia, United States. I contested this for most of the year. So I guess the EU is just desperate and wants to act as quickly as possible. ”
But in practice, a trial would not magically result in more doses. The EU could win the case, but AstraZeneca will not have more doses to administer.
And even under an accelerated procedure, the court can only make a decision after the hearing on May 26. At this point, some EU countries may already have excess doses, as many restrict the vaccine to older populations due to the potential risks of rare blood clots.
Finnish officials, for example, say they may have to cancel orders soon as they only use the vaccine in those over 65, most of whom have already been vaccinated. Denmark, meanwhile, has stopped using the jab altogether and is sending at least a few doses to its neighbors.
Sébastien De Rey, researcher at KU Leuven, thinks it is probably true that the Commission is really trying to get more doses. But it is just as likely that the EU wants to show AstraZeneca and other drugmakers that the Commission cannot be bypassed by sending the message: ‘We take things seriously’.
The Commission, for its part, insists that its legal action against AstraZeneca is simply to get the promised doses.
“The aim is to receive the doses to which we are entitled,” said Commission spokesperson Stefan De Keersmaecker.
The Commission’s argument, presented during the preliminary hearing last Wednesday before the Belgian court of first instance by its lawyer Rafael Jafferali, is that the company was not using all the production sites included in its contract.
So far, only two drug substance sites in the EU and one back-up plant in the United States have manufactured the substance for EU vaccine doses. Two other UK factories included in the EU contract did not produce any substance for the EU.
AstraZeneca’s lawyer, Hakim Boularbah, replied that the company is not required to use all of these plants. This sentiment was also underscored earlier in the week, when the Anglo-Swedish drugmaker said it had “fully honored” the Commission’s advance purchase agreement, adding that manufacturing vaccines was “difficult “.
This excuse has not been good enough for the EU, which says AstraZeneca is now on track to deliver just 70 million of the 180 million doses promised in the second quarter of the year, on top of delivering only 30 million out of 120 million planned by the end of March.
It will come down to what’s in the contract.
AstraZeneca was expected to invoke a provision (Article 15.1.e) whereby the Commission and EU countries waive the right to sue the drugmaker for late delivery, said Marcel Fontaine, professor of law at the University of Louvain. A judge could then agree that the EU cannot prosecute: “This could be the end of the complaint,” he said.
At Wednesday’s hearing, AstraZeneca did not invoke this clause, although it could do so later. “I find it surprising, but maybe they have learned that they have little luck with this arrangement,” said Fontaine.
Indeed, Belgian law stipulates that such a waiver cannot allow a party to simply ignore an essential part of a contract, which in this case is the delivery schedule. The Commission could have come back and argued that this clause did not mean that AstraZeneca could simply completely tear up the delivery schedule signed by the two.
Instead, the company focused its argument on its “best efforts” to deliver vaccines, using the now infamous phrase from AstraZeneca CEO Pascal Soriot earlier this year. The Commission will have to prove that the company did not go out of its way to ensure on-time deliveries, Fontaine said.
A judge could examine this question by comparing AstraZeneca’s performance to that of other vaccine producers. And there, the picture is not great for the Anglo-Swedish pharmacist: at the end of the first quarter, Moderna delivered the 10 million doses he had promised. BioNTech / Pfizer has delivered seven million more doses than expected in the same time frame, and will deliver 50 million more in the second quarter. Whether Johnson & Johnson delivers the promised 55 million doses remains to be seen.
AstraZeneca, meanwhile, has delivered 34 million doses so far since the start of the year and plans to deliver only a third of the total 300 million doses promised by the end of June in total.
Tobias calls these figures “quite striking”, especially compared to the EU vaccine poster, BioNTech / Pfizer.
Even though the Commission has a solid legal record, it is not clear what a victory could really bring.
Asked this week, De Keersmaecker would not speculate on what would happen if AstraZeneca simply did not have any more doses to supply the EU.
For its part, the company says it will deliver nearly 50 million doses by this Friday, which is already down from its initial commitment to deliver 80 million in April. But earlier this week, a Commission official said the company delivered just 34 million doses.
“It is not impossible” that the company can achieve this goal, said the official. Neither the Commission nor AstraZeneca immediately answered whether the company was providing enough to meet that target on Friday.
Yet even if the company hits that April target, the Commission’s contract says the full delivery of 300 million doses should be delivered by the end of June. It is unlikely that the company will be able to deliver as many. If he fails again, the Commission does not have many options. The EU could terminate the contract, but that would leave the EU without any additional dose, De Rey stresses.
Fontaine said the court is unlikely to force AstraZeneca to redirect supplies from elsewhere as this could cause the company to sever other contracts.
Tobias saw another scenario: The EU could ask an AstraZeneca judge to pay essentially whatever the cost of breaking the contract, for example, depending on the cost of finding replacements. “You could probably set an amount of what it would take to enter the market and buy from Pfizer, buy it from Moderna and put a price on it,” he said.
Either way, the legal process could take some time.
“The litigation is progressing slowly,” said Tobias. “Even … if the EU wins the dispute … you could appeal. So even if [the Commission] win, it wouldn’t happen very quickly. “
This article is part of POLITICOPremium Police Service from: Pro Health Care. Whether it’s the prices of medicines, EMAs, vaccines, pharmaceuticals and more, our specialist journalists keep you up to date on the topics driving the health policy agenda. E-mail [email protected] for a free trial.