Daily Management Review

AstraZeneca Sued By EU For Alleged Breach Of Covid-19 Vaccine Supply Contract


AstraZeneca Sued By EU For Alleged Breach Of Covid-19 Vaccine Supply Contract
Legal action has been taken against AstraZeneca by the European Commission for disrespecting the contract for the supply of Covid-19 vaccines as well as not providing a "reliable" plan that can ensure deliveries in a reliable manner, the Commission said on Monday.
There was no merit in the legal action by the EU, AstraZeneca said in response, and promised that it will defend itself strongly in court.
In its contract with the European Union, a commitment to make its "best reasonable efforts" for delivering 180 million vaccine doses to the EU in the second quarter of this year was made by the Anglo-Swedish company among a total delivery of 300 million between the months of December and June.
On March 12 however, AstraZeneca said in a statement that it will be able to deliver only one-third of the pledged vaccine doses by the end of June and out of that about 70 million would be delivered only in the second quarter. A legal notice opt the company was sent by the Commission a week later as a first step to initiate a formal procedure to resolve disputes.
The vaccination drive of the European Union has been hampered partly because of the delays in delivery by AstraZeneca as this vaccine, which the company had co-developed with Oxford University, was initially identified to be the main one in an EU rollout during the first half of the current year. Following repeated cuts in deliveries, the EU has now resorted to using the Pfizer-BioNTech jab as the main vaccine.
"The Commission has started last Friday a legal action against AstraZeneca," the EU spokesman told a news conference, noting all 27 EU states backed the move.
"Some terms of the contract have not been respected and the company has not been in a position to come up with a reliable strategy to ensure timely delivery of doses," the spokesman said, explaining what triggered the move.
"AstraZeneca has fully complied with the Advance Purchase Agreement with the European Commission and will strongly defend itself in court. We believe any litigation is without merit and we welcome this opportunity to resolve this dispute as soon as possible," AstraZeneca said.
Belgian courts will settle the dispute according to the contract.
"We want to make sure there is a speedy delivery of a sufficient number of doses that European citizens are entitled to and which have been promised on the basis of the contract," the spokesman said.
The main aim of the legal action was to push the company to making more supplies than what the company has announced it would be able to deliver, EU officials confirmed.
The two parties have been at loggerheads about the issue for months now even as concerns were being raised about the efficacy and safety of the vaccine. Even though the vaccine has been allegedly linked to very rare cases of blood clots, it has been given the green signal for usage by the EU drugs regulator to curb the spread of the pandemic.