What does the AstraZeneca/EU contract entail?

It has been a rough start. The British government’s refusal to grant João Vale de Almeida, the new EU ambassador to London full diplomatic status was seen as an insult. The External Action Service signed by the UK in 2010 as a result of the Lisbon treaty states that EU diplomats should be granted the “privileges and immunities equivalent to those referred to in the Vienna Convention on Diplomatic Relations of 18 April 1961”. The EU responded by cancelling meetings between officials and the UK’s ambassador. And then, it escalated.

On January 29th, the Oxford-AstraZeneca vaccine was approved for use in the EU. The British-Swedish pharmaceutical manufacturer announced it would need to reduce deliveries to the EU by 60% to 31 million doses in the first quarter of the year – out of the 100 million promised by March as part of the 300 million doses signed for in August. The UK’s 100 million doses deal would not be affected as it was signed in May and approved on December 30th. In response, the European Commission said it would introduce export controls on vaccines produced within the bloc: “The protection and safety of our citizens is a priority and the challenges we now face left us with no choice but to act.”

But this also included triggering Article 16 of the Northern Ireland protocol, which would prevent the exports of vaccines from the Republic to Northern Ireland. The mistake was quickly corrected, but the fallout was instant. Julian Smith, former Northern Ireland secretary said the EU had “pulled the emergency cord” without following procedures, adding “I’m very pleased that they changed their mind.”

The European Commission has since republished its vaccine distribution control measures without Article 16 but said it would not accept AstraZeneca’s argument for the delay of the vaccine on the first come, first served basis. Pascal Soriot, the British-Swedish company’s CEO said: “We are basically two months behind where we wanted to be. We’ve had also teething issues like this in the UK supply chain. But the UK contract was signed three months before the European vaccine deal. So with the UK we have had an extra three months to fix all the glitches we experienced. As for Europe, we are three months behind in fixing those glitches.” One of the main issues that seems to play as a decisive factor in the delay of the vaccine to Europe and not the UK is that production problems are encountered in Europe and the sites in the UK should keep their promise to the UK.

As heavily mishandled and criticised the EU’s position might have been, the redacted AZ/EU contract states that the company had committed to deliver a set of Initial Europe Dozes in the first quarter of the year (Section 5.1) and that “AstraZeneca shall use its Best Reasonable Efforts to manufacture the Vaccine at manufacturing sites located within the EU(which, for the purpose of this Section 5.4 shall include the United Kingdom)…If AstraZeneca is unable to deliver on its intention to manufacture the Initial Europe Dozes and/or Optional Dozes under this agreement in the EU, the Commission or the Participating Member States may present to AstraZeneca, CMOs within the EU capable of manufacturing the Vaccine Dozes” and use it to increase the available manufacturing capacity (Section 5.4).

Furthermore, Section 13.e states that the initial dozes committed and paid for in advance by the EU are free from any other commitments “it is not under any obligation, contractual or otherwise, to any Person or third party in respect of the Initial Europe Doses or that conflicts with or is inconsistent in any material respect with the terms of this Agreement or that would impede the complete fulfilment of its obligations under this Agreement;” However, it seems that the UK is refusing to allow the export of vaccines produced here until the UK’s population is vaccinated, despite its early use of the Pfizer/BioNTech vaccine.

German MEP Peter Liese said: “For five weeks now the BioNTech vaccine that is only produced in Europe, that has been developed with the aid of the German state and European Union money, is shipped to the United Kingdom, so people in the United Kingdom are vaccinated with a very good vaccine that is produced in Europe, supported by European money. If there is anyone thinking that European citizens would accept that we give this high-quality vaccine to the UK and would accept to be treated as second class by UK based company. I think the only consequence can be to immediately stop the export of the BioNTech vaccine and then we are in the middle of a trade war. So, the company and the UK better think twice.”

The European Commission insists its controls are a temporary scheme, not an export ban and said it had reached an agreement with five pharmaceutical companies: AstraZeneca: 400 million doses; Sanofi-GSK: 300 million doses; Johnson & Johnson: 400 million doses; CureVac: 405 million doses; Moderna: 160 million doses. There have also been talks with Novavax, for up to 200 million doses. This could ensure almost two billion doses for European citizens. The UK and the EU face the same threats and their geographically proximate position implies that one is not safe without the other being safe.

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