AstraZeneca/EU contract

https://fragdenstaat.de/dokumente/8409-apa_-_astrazeneca/

by hannob • 5 years ago

199 353 5 years ago

fragdenstaat.de

cinntaile• 5 years ago

Apparently it was mistakenly uploaded uncensored before this was changed? Where can we find the uncensored version?

DangerousPie9• 5 years ago

This is the "uncensored" version. Parts in red were originally censored but have been revealed.

mytailorisrich5• 5 years ago

There's a lot of controversy and arguments on this at the moment, a lot of it is political with a good dose of Brexit added in.

So to stir towards more positive aspects:

AstraZeneca, which are between a rock and a hard place here, has agreed to supply the EU at cost. I don't know if it's their global policy, I hope it is, but they should be commended for that. That's not what all suppliers of Covid vaccines do.

More generally regarding the Covid vaccines: I find quite extraordinary that less than 12 months after Covid-19 was first analysed we have several vaccines available and we also have the capacity to produce hundreds of millions of doses. Science + technology + capitalism is a hugely potent combination (ok, sorry that last sentence may seem political but this is what drove the development of these large scale production technologies).

Edit:

It looks like I may need to clarify my mentioning capitalism. I was referring to production capability.

Private companies (not only in biotech, in every industry) have developed extremely effective and efficient ways to produce huge quantities of whatever they produce because driving down costs and increasing efficiency and quantities is how you increase profit. This is why we can now produce so many doses of Covid vaccines quickly and at relatively low cost.

tomatocracy• 5 years ago

As I understand it, their policy is to supply developed markets at cost until the pandemic is over (whatever that means) and developing markets at cost in perpetuity.

hef1989815• 5 years ago

The pandemic could e over on July 1st 2021, according to the contract. No idea how that is actually defined, I would hve expected some stipulations around the WHo delaring it or something.

Fun fact, epidemics are included as force majeur events. And the Force Majeur paragraph is a carbon copy from the last fulfillment contract I read.

DoingIsLearning4• 5 years ago

AstraZeneca, which are between a rock and a hard place here, has agreed to supply the EU at cost

For the sake of completeness AstraZeneca have agreed to supply all markets at cost, not just EU.

This was part of their contractual obligation with Oxford University.

The vaccine was developed with Oxford Uni funding, AstraZeneca signed an agreement to mass manufacture under the condition that it would be sold worldwide without a profit margin.

mytailorisrich5• 5 years ago

Thanks for giving details and to make clear that this is their global policy. They should indeed be commended for that.

soperj• 5 years ago

Thanks for this, makes it much clearer. I do wonder though if there will be any Hollywood creative accounting there with the "no profit margin".

tsimionescu6• 5 years ago

Science + technology + capitalism is a hugely potent combination

Wait till you see what science + technology - capitalism can achieve!

But more seriously, we're also seeing the problems of capitalism here. Apart from the problems with its price, especially for the third world, I also think it's important to realize that the main motivation for vaccine skepticism is capitalism and the bad incentives it creates for companies. People understand that it's in any of these companies' best interest to lie about effectiveness and safety of these vaccines, and that they have more than enough money to hide any potential wrong doing for a long time.

I am NOT an anti-vaxxer. I take flu shots every year, and I will get this vaccine as well as soon as I am offered the chance (I'm neither at risk nor working in a crucial industry). But the pharmaceutical industry deserves its reputation to some extent, and it is mostly capitalism's fault that we have these huge behemoths that can act with impunity.

tomcam3• 5 years ago

A sincere question here. There may be many positive answers that I don’t know about. Which non-capitalist ventures have done as good a job as capitalist ones at creating drugs?

xiphias2• 5 years ago

There's no capitalism going on here. I have parents over 70 in the EU, I would gladly pay $5000 per person to get them vaccinated with an mRNA vaccine (Pfeiser or Moderna), but people under 60 are being vaccinated in Israel right now for free.

Vaccination right now is completely political, governments took over control instead of just regulating safety and efficiency of the vaccines.

maxerickson3• 5 years ago

How do you make a vaccine that doesn't have a price?

It's going to require resources no matter what, and the $5 to $10 that the AstraZeneca and J&J vaccines are estimated at is a pretty good value.

(for instance, the US could buy vaccine for the entire globe and not worry about the cost)

ajvarparadise_• 5 years ago

Sorry for asking, is there a tldr: ?

hannob• 5 years ago

To explain what this is: The EU mistakenly uploaded a censored version of the contract earlier today where some blacked out parts could be reconstructed using PDF metadata.

This version has those included in red.

raverbashing• 5 years ago

Not sure if it was the EU or AZ that did the (failed) redaction. (Yes, despite the fact that it was published on an EU website)

Anyway it seems that orgs keep falling for the "PDF redaction" caveats

vinay427• 5 years ago

To be fair, I've grown paranoid about PDF metadata and redactions, so I prefer taking screenshots and making a new PDF out of those as long as the document is only a few pages in length, or using imagemagick or similar to flatten it. I haven't found an easier way to be absolutely sure that my annotations are permanent, and this metadata issue is perhaps even trickier.

mrtksn10• 5 years ago

5.4.

manufacturing sites. AstraZeneca shall use its Best Reasonable Efforts to manufacture the Vaccine at manufacturing sites located within EU(which, for the purpose of this Section 5.4 only shall include the United Kingodm) and may manufacture the Vaccine in non-EU facilities if appropriate, to accelerate supply of the Vaccine in Europe; provided, that AstraZeneca shall provide prior written notice of such non-EU manufacturing facilities to the Commission which shall include an explanation for such determination to use non-EU manufacturing facilities. If AstraZeneca is unable to deliver on its intention to manufacture the Initial Europe Doses and/or Optional Doses 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 Doses, and AstraZeneca shall use its Best Reasonable Efforts to contract with such proposed CMOs to increase the available manufacturing capacity within the EU. The manufacturing site planning is set out in Schedule A.

Probably needs a lawyer specialised in this stuff and the jurisdiction where the contract is signed, but it seems like this is the part that EU says the contract included the UK facilities.

Anyway, whatever happens people of Europe wont forget this, even if it was purely EU's fault. You don't say you belong to a team, omit the vaccines of China and Russia and then be let to die off because the rest of the team says you should have signed better contract. Next time something important comes up, EU should think beyond the UK/USA.

dstick• 5 years ago

It’s mind boggling to me that “best reasonable effort” made it in there multiple times. That’s so vague and up to interpretation, who can blame them that they sold the supplies for 3x as much to another country?

Anything can be construed as “best reasonable effort” - or is this specific legalese I’m unaware off?

airstrike• 5 years ago

IANAL but I think it qualifies as legalese you're unaware of.

Also, just by definition, whatever the lawyers agreed on is likely appropriate in a legal context and a layman's criticism of the language is almost invariably because they're missing the knowledge. Imagine said lawyer reading your code and challenging you on your API design.

Anyway, if challenged in court, AZ would have to demonstrate that they actually made genuine efforts before going down a different path.

The addition of the word "reasonable" is because they need an out in case they feel they've spent a decent amount of efforts. Whether that amount was actually decent or not is for the judge to decide.

mrtksn10• 5 years ago

Isn't it obvious that the "best effort" is not fulfilled if you you manage to produce 6 hamburgers to UK and one to EU when you specifically said in the contract that your facilities in the EU and UK are to be used?

jorvi• 5 years ago

Even if AstraZeneca gets away with it legally, they will be a leper to the EU and be crushed in whatever other medicine negotiations they end up having with the EU or its constituent national governments. Burning the goodwill that gets you access to a relatively rich 450 million consumers market is pretty boneheaded.

tomas• 5 years ago

There is a definition in the document:

1.9. “Best Reasonable Efforts” means

(a) in the case of AstraZeneca, the activities and degree of effort that a company of similar size with a similarly-sized infrastructure and similar resources as AstraZeneca would undertake or use in the development and manufacture of a Vaccine at the relevant stage of development or commercialization having regard to the urgent need for a Vaccine to end a global pandemic which is resulting in serious public health issues, restrictions on personal freedoms and economic impact, across the world but taking into account efficacy and safety; and

(b) in the case of the Commission and the Participating Member States, the activities and degree of effort that governments would undertake or use in supporting their contractor in the development of the Vaccine having regard to the urgent need for a Vaccine to end a global pandemic which is resulting in serious public health issues, restrictions on personal freedoms and economic impact, across the world.

addicted3• 5 years ago

The fundamental problem is that AstraZeneca has conflicting contracts with the UK and the EU.

AstraZeneca, which apparently has no experience with maki vaccines, has messed up every part of their job. Starting with the trials (which is why the EU delayed the emergency authorization and the US hasn’t given it yet) continuing with manufacturing, and apparently now it’s becoming evident their legal department has screwed up as well.

notahacker• 5 years ago

'Best reasonable effort' is defined for both parties elsewhere in the contract, but it's still very open to interpretation

legulere• 5 years ago

How is one country paying 3x as much when AstraZeneca still has an obligation to produce more or less at cost? (https://www.ft.com/content/e359159b-105c-407e-b1be-0c7a1ddb6...)

kitd5• 5 years ago

Actually, it's specifically defined in one of the appendices.

wozer• 5 years ago

I think it's not really the UK's fault.

It's AstraZeneca. They are frauds.

eznzt2• 5 years ago

What is the excuse to have this contract censored? I understand what it's in the interest of security for example, but this...?

Also, where are the people who laughed about Brexit now?

Ninn2• 5 years ago

Person who laughed and still laughs at Brexit here. The contract terms of the british contract has not been uncensored as far as I know?

eznzt2• 5 years ago

AZ is holding the vaccines for the UK and the EU is moaning about it: https://www.bbc.com/news/world-europe-55822602

DangerousPie9• 5 years ago

Commercially sensitive information? Doesn't seem too unusual to me.

And I'm not sure what this has to do with Brexit.

DC-3• 5 years ago

I think they're alluding more generally to the idea that the EU's bureaucratic sluggishness caused its member states to not have a contract in place with AZ until three months after Britain, putting them proverbially to the 'back of the queue'.

maxerickson3• 5 years ago

There's a confidentiality clause in the contract (page 26 of the link).

Perhaps AstraZeneca asked for it and the member states didn't think it was worth fighting over?

frombody• 5 years ago

EU is massive and has a lot of negotiating power.

Allowing everyone else to see the contract would give other countries stronger leveraging positions against AstraZeneca.

addicted3• 5 years ago

I’m not sure what this has to do with Brexit.

The exact same arrangement would have been possible and likely before Brexit as well.

that_guy_iain3• 5 years ago

People who were pro-Brexit seem to think this one thing proves they were right. They seem to think other EU members will be angry with how the EU are treating the UK in this matter and will also want to leave. This point seems nuts since the EU is basically fighting for it's members vs a non-member, kind of shows why it's better to be with them than againist them. Considering this hasn't fully played out, their constant bragging on the matter seems foolish. Especially considering the EU clearly has more power. The UK is in an extremely vulnerable position overall and seem to be making their position unsafer by the day. The damage the UK goverment is doing to the EU relations will, I suspect, haunt the UK for decades. I suspect if this carries on for a year or so, the UK will end up in a trade war with their closet and largest trading partner during one of the largest recessions ever.

I highly suspect this is going to cost AstraZeneca big.

johannes1234321• 5 years ago

Correct at the time of writing that document UK was still bound by the single market rules (transition period) but EU27 decided to not fight over vaccines, but coordinate and go for bigger central orders.

scythe• 5 years ago

Also, where are the people who laughed about Brexit now?

Please don't throw grenades.

https://www.flamewarriorsguide.com/warriorshtm/grenade.htm

cardinalfang• 5 years ago

Too late, this affair has already been used as artillery by the pro-brexit press.

afavour• 5 years ago

Also, where are the people who laughed about Brexit now?

The idea that this one event makes up for the colossal mess of Brexit is... interesting.

jiofih4• 5 years ago

The EU financed the development of this vaccine to the tune of 300M. The UK contributed 65M, the US 1.2B.

alibarber7• 5 years ago

Which per person works out as the least. Not that I'm saying this situation is justified by that, but I don't find it surprising that AZ are not prioritising the EU based purely on this.

netsharc• 5 years ago

Just because someone did something stupid, doesn't mean the previous actions of their opponent were clever...

DangerousPie9• 5 years ago

Nothing particularly interesting or shocking about the parts that got un-censored. The important part seems to be 5.4, which was already readable before.

To me that section seems so suggest that production facilities in the UK should/could indeed be used to supply the EU, which is what the EU seems to want and AZ/UK are denying. But I'm sure there are a lot of highly paid lawyers looking at this from all sides right now.

mytailorisrich5• 5 years ago

From what I gather from the media here in the UK one problem is that AstraZeneca's contract with the UK government is that they will not export vaccines produced in the UK until the British government's order is fulfilled.

Pretty smart stipulation by the UK government but it may be putting AstraZeneca, which agreed to it, in an awkward position...

DangerousPie9• 5 years ago

Ah, that's an interesting aspect I didn't know about.

But if that's true it seems very hypocritical of the UK to complain so much about the EU's plan to introduce vaccine export controls, since they are doing the exact same thing already...

Bombthecat2• 5 years ago

So basically, two exclusive contracts? Lol..

rsynnott• 5 years ago

AstraZeneca's real problem seems to be that they, on the face of it, promised contradictory things to different customers.

riedel• 5 years ago

The other part is the definition of Best Reasonable Effort . I wonder if the behaviour of Pfizer has an impact here.

ldng• 5 years ago

Yes it does. They used it to announce that they deliver 20% bottle because they are not billing 6 doses per bottle while at the same time arguing publicly that they contains 5. They are then hiding behind that contract the talks about doses, not bottles and best effort not hard delivery. They all have the same contract and are following Pfizer example.

BigPharma is screwing up UE big time and that is unacceptable.

Source for downvoters : https://www.mediapart.fr/journal/france/290121/retards-de-va... (FR)

cs02rm02• 5 years ago

Certainly one Belgian lawyer has already stated that he thinks the EU Commission don't have a leg to stand on here. Not that I expect that to slow them down.

https://twitter.com/JeremyC64/status/1355156181753475073?s=1...

Awkwardly it seems Pfizer might shift to supplying the UK from the US and the UK seem content that they have no contractual need to share the AZ doses from the UK facility. So the EU don't seem to have any leverage on this issue.

Some have tried to say this debate is EU vs AZ but this map suggests otherwise.

https://thumbsnap.com/sc/JtrAXvhv.jpg

DangerousPie9• 5 years ago

Can we have a zoomed out version of that map please? I suspect it's been framed for maximum controversy.

And I'd also like to hear from more reliable lawyers than "a guy on Twitter".

hardlianotion3• 5 years ago

Quite.

berdario• 5 years ago

The UK should be the same color as Russia and Turkey. Either they're all red, or they're all grey

hardlianotion3• 5 years ago

No, the important section is 5.1. 5.4 includes UK only to say that production centres outside the EU need to be explained to and approved by the EU. UK factories are counted as EU for this point only.

NiceWayToDoIT• 5 years ago

"Uncensored"

So what are those black out parts?

Maybe just partly "uncensored"

arendtio• 5 years ago

https://news.ycombinator.com/item?id=25960718

zoobab• 5 years ago

See https://twitter.com/VrlPlt/status/1355219237745405954

ape4• 5 years ago

"AstraZeneca has committed to use its Best Reasonable Efforts (as defined below) to build capacity to manufacture 300 million Doses of the Vaccine, at no profit and no loss to AstraZeneca, at the total cost currently estimated to be ** Euros for distribution within the EU"

hannon4• 5 years ago

Seems much more convoluted than the pzifer contract with Israel.

temp6672• 5 years ago

So weird - and a good lesson for business. Generally the customer that gives you the most hassle on front end and is the cheapest will demand the most and hassle you the most for the entire period.

This argument reminds me of someone who I once tried to work with, I said, I'll just charge you my costs instead of full rate (this is like a 3x difference in price). So many arguments around cost, so many demands on quick delivery. Meanwhile, the folks paying 3x kept on reasonably agreed program and took 1/10th the time.

Anyone else have this experience?

Rumor had it astra wasn't going to mark up a huge amount.

itronitron2• 5 years ago

A friend of mine who used to own a small Inn learned within a year to turn away customers who either asked too many questions before booking a room or that showed up complaining.

temp6672• 5 years ago

Yeah - there are folks I think interested in having things done. They pay, you do it, they are happy.

And then there are folks who have their own problems - they may be disorganized? Have internal conflicts? Have other financial issues. So they come in saying - hey give us a break on cost. you do. And then you are in for it, because they can't agree internally, complain about everything.

This EU situation reminds me of that. Instead of saying how can we help increase production its endless blaming etc. Isn't the company an EU company? Why wouldn't they make wht they can?

string2• 5 years ago

Absolutely. My best paying clients are both the most reasonable and flexible. These are generally well established businesses or big cultural organisations (fintech and museums mostly), and the people I work with are professionals.

My most difficult clients are always smaller design studios and artists who invariably have small budgets and tight deadlines, obviously don't bother to read contracts and are often late with payment.

It basically boils down to how much the customer values your work. In this case I think the bureaucrats egos have got the better of them.

ucha• 5 years ago

In 7.1., when they say the EU will provide funding at an amount equal to the "cost of goods", does it mean that AZ doesn't make profits on the vaccine they sell to the EU?

There is also a mention of a cost of good estimate and how if the cost of good was off by more than 20%, the EU should pay the difference...

JumpCrisscross10• 5 years ago

does it mean that AZ doesn't make profits on the vaccine they sell to the EU?

During the pandemic period, which is defined to expire on 1 July 2021. A stupid contractual provision to include, since it creates monetary incentives to delay delivery.

(Not saying that's why this is happening. But if I were negotiating something like this, I'd include a bonus for early deliveries. It keeps interests aligned, and gives the supplier ammunition with which to add redundancies.)

DangerousPie9• 5 years ago

Pretty sure that's a standard part of any agreement AZ made, since Oxford University only licensed the vaccine to them if they provided it at cost.

kitd5• 5 years ago

I believe the "no profit" clause comes from Oxford Uni who own the IP.

trebligdivad• 5 years ago

Right, AZ is doing all of this at cost for everyone, not just the EU (until the end of the Pandemic); I feel sorry for AZ having to take this hastle when they're not making anything out of it.

thow-011872• 5 years ago

Don't they get their manufacturing facilities upgraded for free?

s1artibartfast• 5 years ago

At least they are getting paid. Pharmaceuticals generally lose money on vaccines. A big problem is many governments have historically reneged on their advance purchasing agreements when the viruses are not as bad as anticipated.

breakfastduck7• 5 years ago

They will be be getting partially funded from the UK government solely on the virtue of the manufacturing centers being in the UK.

noncoml3• 5 years ago

If you listen to UK BBC news, they spend half of their airtime saying how the UK government placed the order months before the EU, and that the EU is in the wrong, since they haven't even approved the vaccine yet(as of the last time I listened to the BBC news), so they shouldn't complain and so on.

I am surprised by the polarization and demonization of the EU they are promoting. Was not expecting that from BBC. And then they wonder why British people voted for Brexit.

pasabagi2• 5 years ago

It's hard to overstate how tight the british establishment is, media included. It's a small country, and power is concentrated in a vanishingly small number of hands, many of whom are married, or went to school together, or are close friends.

This is why when britain passed 100,000 coronavirus deaths, with the worst death rate in the world, nobody resigned, and nobody called for anybody to resign.

The BBC is part of this kind of tight, teflon kernel that's at the heart of why the UK is such a dysfunctional country these days.

isbvhodnvemrwvn• 5 years ago

Very relevant "Yes, Minister";

https://www.youtube.com/watch?v=B9tzoGFszog

subsubzero2• 5 years ago

It's a small country, and power is concentrated in a vanishingly small number of hands

This is very true, I chatted at length with my neighbor who lived his entire life in the UK(up to a few years ago) and was shocked how stratified the society is. Basically there is small group of people(who went to Eton, are lords or knighted, from famous families) that form a clique that runs everything in the country. No matter how much money you make or how successful you are, you can never join that circle.

An example was told to me that even David Beckham (famous soccer star) is looked down upon by that segment and does not associate with them and could never join that part of society.

JumpCrisscross10• 5 years ago

As a (Swiss) American, I can't see the flaw in that logic. The UK signed first, is paying more and included a provision preventing the export of British-manufactured doses. The EU didn't. The EU also added a provision mandating AstraZeneca make no profit prior to 1 July 2021 (the end of the Pandemic Period), a counter-incentive to ramping up production.

It's not fair. But neither is the UK and EU getting wildly more doses per capita than Africa, South America or Oceania.

kitd5• 5 years ago

Tbf, I believe the "no profit" clause comes from Oxford university, the IP owner.

radiator• 5 years ago

Why on Earth is it not fair that the UK and EU get more doses of their own vaccines per capita than Africa, South America or Oceania?

Why would they be obliged to export even one dose of something they produced, before they have provided for every single one of their citizens?

double-a2• 5 years ago

I don't understand why there's a comparison with the UK vaccination program at play here. Your comment is precisely the type of incendiary fallacy that OP is accusing the BBC if.

EU is claiming that AZ is breaching the contract it had with them. Whether they are in the right or not, what does the UK's relationship with AZ have to do with it?

oliwarner• 5 years ago

They spend half their time talking to their government, who say that.

The BBC can't win. When they editorialise to try to dig into a subject, it's left wing pandering, and when they just listen to official sources, they're right wing mouthpieces.

simonswords82• 5 years ago

True that - which is why it's so important to obtain news from multiple sources and then attempt to form your own view.

bitcharmer• 5 years ago

I don't understand, where is BBC incorrect here? How would you like them to report on this?

EU was months late and they move much slower than other parties in the whole process and on top of that they signed agreements with "best effort" clauses instead of hard obligation of vaccine delivery. How is this UK's fault?

DangerousPie9• 5 years ago

Nobody is saying it's the UK's fault, but just because they signed the agreement a few months later doesn't mean that AZ isn't bound to that agreement. There is no "first come first serve" clause in there.

Scarblac2• 5 years ago

The EU claims there are no best effort clauses, which is why they asked AZ to make this public. We'll find out.

The rest of your comment makes OP's point: this is a contract dispute. Why is it relevant when the UK signed their contract, or that the EU hadn't approved the virus yet? Such comments only serve to make UK citizens angry at the EU.

noncoml3• 5 years ago

I don't think I implied that UK is in fault, or that EU is in the right here.

The problem, in my opinion, is with the way the report it, the time they spend on it and the demonization of the EU.

Even if EU is 100% in the wrong, do they need to spend half their air-time covering a dispute between AstraZeneca and the EU, arguing how the EU is unreasonable and pretty much the monster that tries to steal the vaccines from the UK people?

My disappointment is the with the division, polarization and demonization of the EU they are promoting.

After listening to that rhetoric with my (British) wife for 10 minutes straight, I heard heard saying "yeah, fuck these EU assholes".

barrkel• 5 years ago

The best effort relates to setting up the manufacturing of the vaccine, not distributing it. See e.g. https://davidallengreen.com/2021/01/what-can-be-worked-out-a...

There's no doubt the UK has been nimble and reasonably effective on the vaccine front (as we all know, the EU is a very mixed bag by construction); just as well since it has been dreadful on the mortality front. The UK commentariat is a little bit shocked, but it is to be expected - it's out of the club. There will be more consequences later.

I, for one, am leaving the UK with my family.

alibarber7• 5 years ago

But surely the EU hasn't exactly covered itself in glory here?

They, factually, objectively, _were_ later in signing an agreement, and have taken longer to approve a vaccine in use elsewhere in the world. Why should they not share some blame from their citizens like any other politician should? The UK government deserves scorn for their handling of the pandemic in the UK. The EU should be criticised for this. It is not a football match. We do not need to 'support' one 'side' against the other.

GizmoSwan3• 5 years ago

There is/was issues with submitted vaccine data. Technically it wouldn't have been approved in normal times till they could get better proven data.

Now it is all water under the bridge because countries are desperate to have enough vaccines.

6 months from now, all countries are going to pretend to be nice nice and when there will be oversupply and new variant of the COVID, they will be dumping the old vaccines on other countries.

alibarber7• 5 years ago

Instead of downvoting - please do tell me what is offensive, or how you feel this does not add to the discussion. Or at least do both.

GizmoSwan3• 5 years ago

Every country is for itself when shit hits ceiling, that is my conclusion. Territorial dogma took over with PPP and respirators too.

Now the Swiss and Brits are not part of EU and their own interest supersedes their alliance with EU obviously.

jack_riminton• 5 years ago

Nitpicking but the phrase is "shit hits the fan" i.e. it would go everywhere

Shit hitting the ceiling wouldn't be that dramatic in comparison :)

salicideblock• 5 years ago

I am surprised why anyone is discussing who signed first, given that in the contract AstraZeneca warrants that:

"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 fulfillment of its obligations under this Agreement;"

This ended up not being true, which was not totally unexpected.

AstraZeneca ends up in the bad position of choosing on which of their contracts their will fail, and they evidently chose to fail the EU's in its near totality for the next few months.

It pains me to see the cynicism in shielding behind "best effort" clauses (standard in any procurement under R&D) or in "who came first". It's a serious matter that warrants a cooler and more balanced solution that this.

JumpCrisscross10• 5 years ago

in respect of the Initial Europe Doses

There is text blacked out in the definition of Initial Europe Doses after "within the EU" that I'm curious about.

Also, the clause reads "AstraZeneca has committed to use Best Reasonable Efforts...to build capacity to manufacture 300 million Doses of the Vaccine...for distribution within the EU..." That's ambiguous with respect to distribution.

AstraZeneca are using Best Reasonable Efforts to build this manufacturing capacity. But they aren't under Best Reasonable Efforts obligations to use this capacity for the EU. (The definition of Best Reasonable Efforts overlooks distribution entirely.)

It's a shitty situation. Pain has to be allocated. But based on contract, versus loose notions of fairness, AstraZeneca is under no obligation to export British-made doses to the EU.

gutnor• 5 years ago

That was the same in the Touring Visa that for a while was "The EU refused" and it became just the opposite a few weeks later.

But that's the story of Brexit and its 40 years of media support. Even the BBC has often been on the technically correct side happily reporting welcome change as "UK change" and blaming unwelcome on the EU, even if the UK voted for it.

calpaterson4• 5 years ago

Those are the simple facts and they are pretty operative:

- The UK signed months before

- The EU has been slow to vaccinate independent of that AZ dispute

- The EMA did only approve this vaccine (which the UK is already using) a few hours ago

This dispute has sadly been made into a hugely sensitive national dispute as a distraction from the poor performance of the EU's vaccination programme. Even if nothing had gone wrong with the AZ vaccine production, the EU still would have much poorer rollout than the UK. It's just a cover of jingoism.

agd2• 5 years ago

Not sure why you've been downvoted. It seems very clear that the commission is whipping up a political storm here to deflect from the fact it's done a bad job with vaccine procurement, which will cost thousands of European lives.

YeGoblynQueenne10• 5 years ago

It's the same if you read the Guardian. It's clear that the apparent europhilia of some liberal media was nothing but a political play. They pretended to support Europe only because their rivals, the Tory-supporting media, were against it.

Or pretended to be. None of those people believe anything at all.

btbuilder2• 5 years ago

or perhaps they are jointly shocked to see the EU behave in this way and are providing opinion on this one issue rather than sticking to a predetermined side?

oli5679• 5 years ago

The capacity to manufacture it in UK was developed by a UK government grant that was issued in May and a UK government order that was issued soon after. It is being produced at cost by AstraZeneca. The UK acted quickly, realising that each week of lockdown costs a similar amount to their entire vaccine expenditure. They got scientific advice and backed a range of different technologies.

Meanwhile the EU acted bureaucratically and treated this like a procurement exercise, squabbling about spending and placing orders in December. It is now scapegoating andsuing a company that is producing the vaccine at cost.

GSK has every inventive to scale up capacity and produce as many doses as possible, and has no profit motive to divert doses. It is simply abiding by its agreement with the UK to use UK funded capacity to supply the country first, whilst making best efforts to iron out kinks for European orders.

https://www.politico.eu/article/europe-coronavirus-vaccine-s...

kcartlidge3• 5 years ago

I'm British. I do however believe we should vaccinate the most at risk groups, then be more generous with the UK production facilities for the EU's more at risk groups whilst slowing down our efforts for our own less at risk ones (which includes me). It's the humane thing to do.

That said, my sympathy for the EU (as an opponent of Brexit) has been diminished by their attempted bullying behaviour.

They initially wanted the UK in on their EU procurement. Unlike the EU members of the grouping we were to be excluded from any say in the vaccines chosen, the quantities, the pricing, the manufacturing, and the distribution. No say on anything; take what you're given. They left us with no choice but to do our own deals.

We did those deals faster and with less guarantees at that early stage, fronted virtually the whole cost of the AstraZeneca UK production, accepted liability rather than insisting (as per the EU) that the vaccine makers did, and paid much more, just to get a faster agreement (and we still had the same teething issues the EU are facing now; we weren't special in that regard). Despite all that risk, up front cost, higher prices, and accepted liability, the EU is now demanding that the instant they approve the vaccine they can dip into the supply that has cost the UK far more than most people realise we gave up in order to get that swift delivery.

The EU stumbled by not realising the urgency last year, then stumbled again by badly insulting the UK with the EU procurement "offer" terms which forced us to negotiate separately.

I have a great amount of sympathy for the EU people (I may not be in the EU any more, but I'm still European) but none of this is the doing of the UK - who are simply carrying on using the vaccines delivered - and the first 'shot' at actual vaccine nationalism has been fired not by the mad brexiteers but by the EU with their Northern Ireland border statements and not-export-control-really new 'monitoring' and 'agreement' position.

I really expected coming into this year to find myself part of a massive UK villain state facing a more reasonable EU. I didn't foresee a desparate EU attacking a UK just going about it's own business.

senko• 5 years ago

As a EU citizen, I agree with your assessment completely.

The EU bungled this and it would not be fair if we were to bully our way out of it.

It's sad to see this being a zero sum game, and no way you cut it people are going to suffer (already are) somewhere.

I was expecting a bit more decency on our side. Shattered superiority complex after Brits mismanaged Brexit, maybe?

Our lack of coordination and flailing in this regard is equally impressive.

noncoml3• 5 years ago

On the other hand I am a EU citizen married to UK citizen, living in the US, so my skin in the game is mainly emotional.

I am not saying EU was/is always right, as they don't seem to be right in this case, but I was just hoping that BBC would be more subtle about it. I am totally fine with UK/AstraZeneca pushing back hard.

Just don't see the need for BBC to turn it to a "us vs them" thing. I think I am still living in denial in regards to Brexit. I guess I will have to get used to it.

paganel• 5 years ago

That said, my sympathy for the EU (as an opponent of Brexit) has been diminished by their attempted bullying behaviour.

I'm a EU citizen and I'm with you on this one. Also, I now realise (meaning after Brexit has been actually put in place) that the officials in Bruxelles could have been more forthcoming towards us, the remaining EU citizens, about how UK's exit will effect us. All I was hearing were things like "those dastardly British, they'll pay for it!" while now one cannot receive a package from a relative or close friend in the UK without being flooded with customs forms to fill, to say nothing of the extra money one has to pay for the privilege.

JJzD• 5 years ago

The argument from EU side is that EU money was also spend across those four sites needed to produce. There was expectation of shared cost and shared resources. Az committed they had no competing contracts, and if any would happen they would be brought up for resolution. So it seems the exclusivity has been claimed twice, both in cost as in rewards. Furthermore on the 8th of December UK taskforce said the first shots were from the continent, so the resources were shared after all, but apparently only one way?

About the vaccin buy-in, I never heard that story, but I might be one-sided here. I listened from the Brexit side of the media and the final argument was officially 'they did not receive the email (three times)' The unofficial assumption was that the UK wanted to prove something on their own. This time it worked out, both from securing the vaccins and delivering them. (Good on them, less people dying is a good thing in my book) But the different risk appetite I imagine hard to replicate to the continent, see the German advise for az vaccins above 65.

You're right the expected pre production did not happen, and we can talk all year about what happened. And the UK, approving it sooner, but also in a worse situation, could dip in first. The way forward is to find a fair balance in sharing these resources again, until the issues are solved. Maybe by vaccination degree of the vulnerable, maybe by population size, maybe recognising the UK ordered about 2 dosis per capita, and the EU only 1.

I heard AZ offered 39 million in q1 and the commission not yet being satisfied. But if we're talking numbers, we can get some way out. I just hope the export ban threat or the article 16 hasn't damaged too much.

kmonad2• 5 years ago

I didn't foresee a desparate EU attacking a UK just going about it's own business.

That's imo a narrative from AZ pitting EU against UK, fueled by a susceptible UK media. US articles on this appear a little more measured. Is the EU attacking the UK? I think they are attacking AZ. It is an utter shame how this is turning political, and there are no excuses for the debacle wrt N. Ireland.

Having said this, as I wrote in a different comment, the way I currently understand the situation is that EU demands AZ proportionally reduce fulfillment of orders given their production problems. AZ would thus have to also breach their contract with UK on top of the breach of contract with the EU. AZ pushes the "first come first serve" logic of UK having ordered 3 months sooner, and the UK media, also the left leaning outlets, know that their readers are starved for some news that at least SOMETHING worked in the UK after the recent mess and gobble this narrative up. I don't know if the logic of who orders first gets deliveries first applies in these kind of contracts (IANAL), but I suspect it does not. If it does not, the EU seems to demand something from AZ that they want to avoid, but not attack the UK.

I find it extremely hard to navigate the media on this as it is a disgraceful, loaded, dishonest, political shouting match. Instead it should all be about how to best combat the pandemic of course.

breakfastduck7• 5 years ago

I've never seen such an anti EU reaction both domestically (UK) and internationally.

You try and imply the BBC has been pro brexit - but seriously, this is by far the most hostile the liberal UK media has been to the EU in a long time.

timellis-smith2• 5 years ago

You don't think that threatening a trade war, threatening to break the NI agreement which was a red-line for the EU, blaming the British for your failures and closing off vaccine exports to the UK warrants a degree of hostility?

Edit: Also spreading fake news about the efficacy of the drug.

I suspect if the EU were to invade the UK, you would still be attacking the UK press for outrage.

cblconfederate• 5 years ago

I'm for the EU and of course hope the vaccine problems are solved ASAP, but i'm troubled by the way this has become a political, lawyeristic issue. On the one hand UK media is deseperate to somehow prove brexit worked, on the other hand EU is , once again, trying to solve problems magically by legal means. Are we forgetting we are in an urgent pandemic that threatens the world economy with collapse? This requires a warlike level of mobilization of engineers, not lawyers.

kazen442• 5 years ago

I agree with your sentiment. Also, why not let other manufacturers produce vacciness aswell? Getting the vacinnes produced rapidly and in enough numbers seem to be the number one priority in this.

stefano• 5 years ago

Sanofi will be producing the Pfizer-Biontech vaccine, but it takes a lot of time to set up a new production line. Last estimate I saw was saying July.

thinkindie• 5 years ago

apparently this is going to happen with Sanofi producing Pfizer vaccine after they closed their own trials without a successful candidate.

martinald• 5 years ago

You sound like the "UK media" is one thing. The Guardian, FT, etc are staunchly pro EU and have been endlessly pointing out the problems.

hef1989815• 5 years ago

It isnot, at least not yet, a legal issue. As you said, it is an engineering (manufacturing) and supply / logistics (distribution) issue. None of which are even remotely discussed, not politially, not in the media, no where. So I suspect we won't see any changes on these two fronts. At least no coordinated ones, the manufacturers will have quite motivated engineers working on manufactring ramp ups, I asume.

codeulike• 5 years ago

As you said, it is an engineering (manufacturing) and supply / logistics (distribution) issue. None of which are even remotely discussed, not politially, not in the media, no where.

The Guardian, a few days ago:

"Analysis: technical problem at Belgium plant failed to produce enough vaccine but EU demanding fulfilment of contract"

https://www.theguardian.com/world/2021/jan/26/why-has-astraz...

beefield• 5 years ago

EU:You've... you've got a nice IP protection here, AstraZeneca

AstraZeneca: Yes.

EU: We wouldn't want anything to happen to it.

AstraZeneca: What?

Germany: No, what EU means is it would be a shame if...

calpaterson4• 5 years ago

The EU's approach to resolving this dispute makes absolutely no sense.

Regardless of the fact that, this contract does not, to my reading (IANAL), support their position that they have a claim over the UK-produced vaccines: pursuing a legal resolution seems silly because getting a judgement in your favour will take weeks or months. That is far too long for the timelines the EU wants.

Then, even if such a judgment is forthcoming - you still aren't that much closer to getting more doses because as any solicitor will tell you, possession is nine tenths of the law and the doses are in the UK. There is no realistic chance of any export occurring without the approval of the UK government. The UK has a very serious outbreak of coronavirus too.

Instead of getting on their high horse and starting an enormous public row why don't the EU: a) recognise that this is one of many vaccines and that perhaps, while important, is not singularly important to the effort b) make an arrangement with the UK government to have some kind of expedited access to vaccines? The UK will soon have a surplus of vaccines (and in fact has extra stock already by some accounts - people are being given unused doses). There is an existing trade issue that is causing problems for the UK that I am sure that the UK would like to get sorted...

This kind of over-legalistic attitude is how the EU got into this hole in the first place. Waiting for a single purchase agreement was a mistake because the vaccines have (mostly) turned out to be extremely cheap and the fact that many companies are working on vaccines likely means that none will be able to charge over the odds.

alibarber7• 5 years ago

I think your proposal is what will end up happening.

Johnson has refused to commit to blocking exports of the vaccine. He's a long way from my preffered politician, but people who describe him as a British Trump are wrong. He is no idiot (1). He knows he's been handed a politically interesting situation and is also aware of what state the UK is in with regard to vaccine supply (one of the best in the world at this time) and what benefits some careful political manoeuvering will be able to bring in this time.

Allow me some hyperbole, but the optics of 'Generous UK offers salve to unfortunate vaccine-poverty stricken EU' - whilst sickening would make for some lovely press in the right-wing tabloids and might even go a little way towards his desired 'comming together' of a divided nation.

(1) Yes - Brexit was indeed idiotic but I truly believe he never actually wanted it, and it just got him his longed-for premiership by unfortunate accidental means.

YeGoblynQueenne10• 5 years ago

He fumbled and stumbled into premiership- but now he's going to be capable of "some careful political manoeuvering". The man who made his career as a journalist by badmouthing the EU? I find this very unlikely.

jariel• 5 years ago

I think the 'political optics' win for Johnson is going to more likely be: "We are the first major country to reach near full vaccination".

Bibi in Israel is facing intense political ambiguity, and they are paying 3-4x (for the vaccines) what other countries are paying, and have apparently been doing some behind the scenes shenanigans for acquisition, I mean it's Isreal, that's what they do (no offence to those who might take it that way but they are the most realpolitik country on planet earth). They are way ahead of anyone else and I suggest this is Bibi's political salvation plan.

Boris, similarly.

It's a little bit conspiratorial, but wouldn't be surprised if there are some behind the scenes actions by UK gov. to make sure the UK is first.

Also consider that the EU is frankly playing a losing hand and they look really bad from this.

This is a major existential crisis and if China, US and UK end up with full vaccinations months ahead of the EU it's going to be very, very damaging.

At minimum, the EU has to make a very big public stink about it to ensure people know/believe that the EU is doing what is possible, to mitigate the damage and possibly to be able to push the blame a little bit to others.

Finally - there's nothing wrong with the UK offering the EU help, and that it would also end up being good PR. The problem with the claim is not that it's 'sickening' but rather it's frankly not a huge material PR win. It's a nice thing but it's only worth a news cycle or two.

Having the UK immunized a few months ahead of the EU, irrespective of the underlying realities, is going to be something that will be remembered and analyzed for a decade.

Frankly, in the end, I actually think it's far too risky for any EU/UK politicos to be playing underhanded games, the blowout would be devastating. I just think it's a matter of operational reality that the UK is doing well on this (note they are doing very poorly on infections), though I do feel EU has dropped the ball on securing vaccines from a wider base. Even Canada has put in options to purchase from a variety of sources.

YeGoblynQueenne10• 5 years ago

> Regardless of the fact that, this contract does not, to my reading (IANAL), support their position that they have a claim over the UK-produced vaccines: (...)

See my other comment here. IANAL either, but it seems this was part of the agreement. From the pdf above:

5.4 Manufacturing sites

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 only shall include the United Kingdom) (...)

AstraZeneca agreed to use the UK sites to produce vaccines for the EU.

calpaterson4• 5 years ago

It's a big step from agreeing to use UK sites as part of "Best Reasonable Efforts" to the EU having the right to recieve certain manufacture from UK sites.

Anyway, as I said: it's totally irrelevant as no amount of litigating the contents of their contract will get them what they want. They want doses that are inside the borders of a third country. That third country also has designs on those doses the EU is not in their good books.

It requires a political solution, not a legal one - but try telling the commission that, apparently.

barnabee• 5 years ago

If the EU contractually agreed to use the UK sites to produce vaccines for the EU on a best efforts basis but they also contractually agreed to prioritise delivery to the UK when they signed with them months earlier (which seems likely to be the case), then I'm not sure how that helps them.

IANAL either, but from including similar wording in numerous contracts on the advice of lawyers, I'm reaosnably sure that committing on a best efforts basis would not require breaking your other contractual obligations.

michaelt• 5 years ago

The UK will soon have a surplus of vaccines (and in fact has extra stock already by some accounts - people are being given unused doses).

Eh, that's just a sign that you have to administer an entire box of vaccines after opening the box.

After all, some no-shows are inevitable and it's not like they can turn away the people at the end of the queue to avoid starting a new box given the people in the queue are there by invitation.

stupidcar• 5 years ago

I don't think the EU is really expecting to receive a legal remedy. If they were, they wouldn't be publishing the contract or making such a public fuss. What you're seeing with this publication, with the aggressive statements by senior EU politicians, and with the imposition of border controls, is the application of political pressure, not legal pressure.

I think the EU's behaviour is mostly driven by internal political reasons. Their vaccination programme has been highly inept so far, partly due to the failure of the commission. But no government admits failure when there's a possibility of assigning blame elsewhere. The more EU citizens can be convinced that it's all AZ's fault for missing deliveries, and the dastardly post-Brexit UK holding doses hostage, the less scrutiny will be be applied to their own role in creating the situation.

ketamine__• 5 years ago

Regardless of the fact that, this contract does not, to my reading (IANAL), support their position that they have a claim over the UK-produced vaccines: pursuing a legal resolution seems silly because getting a judgement in your favour will take weeks or months. That is far too long for the timelines the EU wants.

The EU probably isn't going to finish vaccination this year.

omginternets2• 5 years ago

Am I unreasonable in thinking it scandalous that the EU’s contract with AstraZeneca is censored? Shouldn’t this kind of thing be public?

jackweirdy• 5 years ago

If it makes you feel any better, their attempt at redaction was poor and the whole text is present in the bookmarks of the PDF:

https://twitter.com/lijukic/status/1355164987212390402

omginternets2• 5 years ago

“Thankfully the stormtroopers are lousy shots” ;)

I’m very happy they failed. I’m still scandalized they tried.

Where I’m unsure is whether or not there is a good reason for doing this that I’m unaware of. This feels like the kind of outrage where I might be wrong.

martin-t• 5 years ago

I came here to say the same thing. Yet somehow people don't seem to question it. I think everything governments do should be public by default, unless there's strong justification why to keep something secret. Then that justification has to be public and periodically reviewed if it still applies, otherwise it goes public automatically.

hef1989815• 5 years ago

I just started to read it, not finished yet, so I will update this post a needed. Also, I look at it from a purely supply chain / logistics erspective. I also asusme that the other contracts (Biontech/Pfizer, Moderna, Jihnsson&Johnsson,...) are similar.

So far, I found this:

- Paragraph 5.2: The delivery schedule in the main contract is quite short ( I assume based on quarters) and blacked out. I don't like that lack of transparence.

- Paragraph 6.2: I read that paragraph concerning capacit limitations, that of any additional EU orders result in capacity shortfalls, AZ has to increase capacity. And in case AZ is not able to adhere to the schedule agreed in 5.2, AZ is not in breach of contract. If the Pfizer contract is the same, that would mean the EU really shot itself in the foot with the additional orders, that forced a temporary / partial shitdown of Pfizers Belgian plant.

- 6.3: Regular reporting intevalls are not specified, neither is any appendix referenced. That could be an issue.

- 8.1, Delivery: Coordination of deliveries is supposed to happen between the central AZ rep and the reps o the EU member states. Again no details, no mention of working groups, no detailed time tables, eg AZ has to inform "in good time" before doses will be available. I'd say very hard o implement once deliveries are supposed to start, and a clear indication that nobody thought of how the whole purchasing and delivery to member state hubs is supposed to work in real life.

- 8.4 and 8.5: Now the contract specifies "in good time" to be 5 working days. Distribution is up to member states. And in case the hub cannot take the delivery within these 5 days, any storage is on the member state. The period behind this is blacked out. The focus here is purely cost, again I'd say the cintract is falling short on the logistcs side of things.

- 18.7, Force Majeur: Sure, pandemics are usually included as Force Majeur incidents. But really, for a COVID-19 vaccine as well? Come on. The means either the pandemic is delcared over (which it won't be), or AZ has a constant option to just declare Force Majeur if they run into issues. Why not explicitly exclude the ongoing pandemic from being a Force Majeur event?

- Order Form (pages 35 through 38): This is honestly the first contract I saw in my whole life, that spends fou complete pages on cntractually specifying the purchase order. Honestly, I don't see reason why.

- Delivery Schedule (page 40): Now we have a table with monthly quantities. All blacked out. Again, the contract references payment terms, but not a single word on what happens if AZ canno adhere to the schedule. Not good.

I have to say, from a supply chain perspective, this contract is dangerously lacking. Based on my experience with government sourcing, they tend to include everything in the cntract they think about, I assume nobody spared a thought at how the deliveries wil bemanaged,how the schedule will look like, or what will happen if there are delays. That almost borders negligence.

Again, asuming the contracts with the other suppliers are similar, I'm almost sure that there is no organization put in place on EU level, at the suppliers or member states to manage the actual deliveries. None. There is no word in that contract about thecoordination between local vaccination efforts and deliveries. I have the impression, that as with masks, the governments think that you sign a contract, place an order and then have the goods are delivered without issues. It didn't work out like that with masks, it won't with vaccines.

Closi3• 5 years ago

I’m in logistics too, although deliveries seemed pretty flexible from my perspective. 5 days is a huge window (retailers will fine you if you arrive outside their 2 hour window!).

Delivery into any specified single NDC seems sensible.

More specifics around delivery requirements and regulations will differ on a by-country basis regardless.

hef1989815• 5 years ago

You are right. The main difference I see, so, is that in the case of the retailer delivery windows are defined by the retailer. In the case of vaccines, I have the impression, that AZ informs customers when a batch is ready. And then the customers have to accept delivery within 5 days. That means AZ is driving the whole supply chain to certain extent, and not the states being responsible for the vaccinations.

A single DC is sensible, Germany has a total of 16 for the Pfizer vaccine. As states have a lot of independence in Germany, I fear that every state has its own DC for AZ as well. How that middle mile will be organised, I have no idea.

lhnz9• 5 years ago

AstraZeneca is currently struggling to produce 2 million doses a week for the UK [0]. How does the EU expect to use UK production to shore up a shortfall of 49 million doses that they require in February/March?

The doses that exist in the UK only exist because of a manufacturing ramp up done under their own contract during the period of time that the EU was still negotiating a lower price. How does it make sense that a separate contract with AstraZeneca allows them to then get the doses produced for the UK re-allocated to another contract?

The Commission is only entitled to those doses that AZ have, after best reasonable efforts, produced for them under their contract. This attempt to grab doses only in existence because of another prior contract is a disgrace.

[0] https://committees.parliament.uk/oralevidence/1505/html/

YeGoblynQueenne10• 5 years ago

> AstraZeneca is currently struggling to produce 2 million doses a week for the UK [0]. How does the EU expect to use UK production to shore up a shortfall of 49 million doses that they require in February/March?

IANAL but it seems to be part of the agreement. From the posted pdf:

5.4 Manufacturing sites

In short, AstraZeneca agreed to use UK facilities to manufacture doses for the EU.

> The doses that exist in the UK only exist because of a manufacturing ramp up done under their own contract while the EU was still negotiating a lower price.

Presumably, AstraZeneca agreed to provide a certain number (censored in the pdf above) of doses to the EU after AstraZeneca had initiated the "ramp up" you describe. They did not object to selling those doses that were manufacture during the "ramp up" to the EU. The contract doesn't mention any ramp up at all.

damagednoob• 5 years ago

I guess it comes down to the legal interpretation of "Best Reasonable Efforts".

79522• 5 years ago

That does not say anything about exclusivity of doses. It just states that manufacturing has to occur in particular places. What the EU gets out of this is parity between different purchasers within the group.

Also it doesn't seem reasonable to expect AZ to ignore other contracts.

lhnz9• 5 years ago

  > In short, AstraZeneca agreed to use UK facilities
  > to manufacture doses for the EU.

Section 5.1 of the PDF seems to imply that the "Initial Europe Doses" are to be manufactured within Europe [0] "following EU marketing authorization".

Section 5.4 which you quote from specifies that "this section only shall include the United Kingdom". As written, this section does not relate to the distribution of the initial doses in Section 5.1, but instead is about where AstraZeneca _could_ choose to manufacture the vaccine. That is why it explains the process by which they might get prior written notice for non-EU manufacturing sites, and discusses how they could be contracted with if they are unable to deliver doses.

I think that gives them some leeway to ask AstraZeneca to increase capacity in the EU, but it strongly suggests to me that the capacity has meant to come from EU facilities, particularly for the "Initial Europe Doses".

Somebody also linked to this [1] which implies that AstraZeneca stated that they would have no other contracts that should conflict with the "Initial Europe Doses", however, I can imagine AstraZeneca will argue that this is achieved by segregating production in the initial doses stage and that the problem is due to low yields in the EU facilities and not due to competing arrangements.

  [0] https://twitter.com/faisalislam/status/1355120024378335238
  [1] https://twitter.com/antoguerrera/status/1355137923411279878

InTheArena• 5 years ago

As an close observer, I’ve lost a lot of respect watching how the EU in general has handled the whole covid and vaccine mess. They got a away with a lot of shit because USA/Trump/India was a bigger and more obvious bogeyman/disaster. Multiple times there were stories that were just factually untrue that were parroted by leaders in Europe about covid or the vaccine effort. The same bogeyman stories came out about masks being hijacked, Drugs being boarded by Indians or respirators being seized and the USA “buying” all the vaccines and drugs and leaving Europeans to die. Meanwhile the USA and European covid rates pulled equal and Europe now has the dubious honor of leading total cases by 4 million.

What is now true is that Europe has staked itself to a inadequate short term supply, and is now hell bent on limiting vaccine to the UK to make up for its distribution woes.

In the United States it’s looking like a half of project warp speed failed. The GSK vaccine is dead on arrival (2.1 billion) and novavax hasn’t even fully recruited their US study. 4 out of eight billion for vaccines unlikely to make a difference in the USA but the other 4 looks like enough to vaccinate the whole population by late summer.

Hopefully it looks like Europe is going to get Novavax. Despite the USA spending $2 billion prepping that vaccine, it probably won’t be available until early fall in the states at best - so the US company will instead supply Europe. Astra Zenca made mistakes on their studies, and we still don’t know what the over 65 response rate is. It’s being approved because people are hoping that it’s effective. It’s a crappy place to be. But between those two vaccines, there might be enough. The

The entire vaccine mass is a reflection of lack of cooperation between Europe and USA right now.

gdamjan1• 5 years ago

AstraZeneca is currently struggling to produce 2 million doses a week for the UK [0]. How does the EU expect to use UK production to shore up a shortfall of 49 million doses that they require in February/March?

open-source the vaccine, the recipes, processes, etc. everything needed so EU can look for a capable manufacturer on its own?

FuckButtons• 5 years ago

Because bill gates convinced them not to: https://khn.org/news/rather-than-give-away-its-covid-vaccine...

phonebucket• 5 years ago

I'm not a lawyer.

But if reallocating UK doses to the EU, would Astra Zeneca then be in a predicament of not fulfilling their contract to the UK? I have no idea, but presumably this would depend on knowing the UK contract.

So from my perspective, it's tough to know what Astra Zeneca ought to be doing without knowing all of their contractual obligations. That sounds tough.

So I'm glad that I'm not a lawyer.

ChrisKnott• 5 years ago

Yes, the UK contract has an explicit clause that says doses manufactured from the UK plants can only be exported once the UK order is fulfilled. The UK government demanded this as a condition of partnering with Oxford, and vetoed Oxford partnering with Merck because they wanted a UK HQed company.

Whether AZ is breaching the contract with the EU seems to be debatable, but the EU are certainly expecting AZ to explicitly break their contract with the UK.

rvieira• 5 years ago

(I'm also not a lawyer)

Does it matter? From my perspective, that contractual problem is between AZ and the UK, not between the EU and the UK.

If I buy 100 doses from AZ and you buy 100 doses, and AZ only has 125, one of the contracts will have to breached.

breakfastduck7• 5 years ago

No, that's wrong. The contractual dispute is between AZ and the EU.

The UK and AZ already had an agreement in place, with the UK taking main place manufacturing the product.

AZ signed a contract with EU way afterwards. That is the one which would be breached, and the center of the dispute.

s_dev• 5 years ago

The fact that the EU and UK are already fighting illustrates how imporant the EU is. Imagine if the EU didn't intervene in the vaccine programme and it was 28 rich countries trying argue to 28 contracts with AZ instead of just two -- and all the complexity that emerged from just two contracts.

PJDK2• 5 years ago

The EU is fighting with Astrazenica. The UK has mostly kept out of it - only just commenting once the EU decided to change export rules and around the Northern Ireland agreement.

UK-Al05• 5 years ago

I'm thinking a lot of countries are regretting joining the EU vaccination scheme considering how slow it's been.

tomohawk• 5 years ago

The knives are coming out.

https://www.spiegel.de/international/europe/europe-s-vaccine...

The problems began soon thereafter. Negotiations with vaccine producers bogged down, and it wasn't until November that the EU was able to reach a purchase agreement with BioNTech/Pfizer and with Moderna, the manufacturers of the two most successful vaccines thus far introduced. The EU negotiating team, according to people familiar with the talks, was intent on pushing down the price. There was also allegedly an extended disagreement on liability issues, particularly with Pfizer.
While others simply acted with expedience and placed huge orders, the EU – right in the middle of the worst pandemic in a century – decided to bargain like they were at the bazaar. Von der Leyen, of course, didn't lead these negotiations personally. But she is the boss, and carries the political responsibility.

And raiding the company is sure to help things out.

https://www.euroweeklynews.com/2021/01/28/eu-bosses-order-ra...

klelatti3• 5 years ago

This seems to me to best sum up the problem with the Commission's position:

Isn’t the logical absurdity of their interpretation that if AZ were only producing 10 doses a month the Commission is entitled to all of them - notwithstanding that they knew that the UK had entered into a contract months before them.

https://twitter.com/pcavin2/status/1355235189648224260

And note that those 10 doses are of a UK developed vaccine being made in the UK and probably in a manufacturing facility funded by the UK government months before the commission decided to sign this contract.

(And this is not a comment on where the vaccines should go just that the Commission are on very dubious ground with this line of argument - that their contract unilaterally overrides all others).

illuminati1911• 5 years ago

None of that is really relevant. Both AZ and EU agreed to this contract. If AZ has signed a contract that they cannot fulfill, then they have commited a fraud.

klelatti3• 5 years ago

There was clearly significant risk associated with an unprecedented ramp up of vaccine production and I expect that AZ, Pfizer, J&J etc are all working round the clock to try to deliver as soon as possible.

Fraud implies bad faith which I expect is a long, long way from the truth.

breakfastduck7• 5 years ago

They agreed to a contract much later than the UK, and the UK is the main supplier.

The EU is acting like it has first call because of its size as a bloc.

Sorry, that's not how it works. Not forgetting they broke the Good Friday agreement to try and force the point.

neximo642• 5 years ago

The EU was ready to invoke Article 16 of the NI protocol just to get AstraZeneca to send vaccine over. Someone in Brussels really doesn’t like AZ

dependsontheq• 5 years ago

Let's take a step back: - the EU has a binding contract with Astra Zeneca - the idea is to manufacture vaccine before the EMA decision - one week before the EMA decision AstraZeneca tells everybody that there are only 30% of the agreed doses

Now that is super weird, who would do something like this and communicate something like that in the last moment.

The EU is of course now under intense pressure because people are calling them every day and telling them that they are killing their citizens. I think comparisons between the strategy of the UK and the EU or even better Israel are stupid, of course the UK and Israel are able to be faster...they are smaller. But the total volume of available vaccine limits the possibilities for the EU. If the total volume of the UK would be avalailable for the EU it would be a drop in the bucket. And I really don't get all the "race" reporting, it's highly unlikely that vaccination speed differences between one to 3 months will make any difference in mortality.

jpdus• 5 years ago

What I don't understand: Most comments sound like the EU wants to take doses away from the UK.

But wasn't the source of the whole argument that doses produced in the EU (with EU money and for which the EU assumed they were reserved for EU use) were exported to the UK before EMA approved the vaccine, so that now only 31 vs 80m promised doses are delivered in Q1 for the EU while AZ delivers everyone else in full?

I can get behind the critic of the tone, but if this description is correct, AZs went at least against the spirit in the contract.

Everyone else (US, UK with AZ contract) prohibits exports of domestically produced vaccines, while e.g. Pfizer/Biontech supplies everybody out of the EU.

I don't think you can blame the EU now to follow everyone's example as their (naive) idea of generous grants but few rules obviously didn't work out to get the population vaccinated asap.

mchusma• 5 years ago

I don't know about the legality, but I can say that if you want to take forever to lift the ban on the vaccine, you lose moral justification for complaining about things being slow. If they approved in November, I'd feel differently.

zwaps4• 5 years ago

The UK is a small country. Their "Britain first" clause, in absolute terms, has little impact.

If the EU had done the same with the Pfizer/BionTech vaccine, then the only countries with any vaccination success would have been the US, the EU, and whoever made a deal with either China or Russia (assuming efficacy there).

The EU has a moral obligation to supply the world, given that the BionTech vaccine was the first to be available and still is the one with the highest success rate.

So, personally, I am glad that the EU did not follow the UK with an exclusivity contract. It would have been a literal disaster for many countries, including the UK.

I am less happy about the EU's reaction. There is really nothing to be done right now, AZ played the UK and EU against each other. The EU should remember this - and also the UK's "Britain first" contracting very well indeed. However, this grandstanding and sable-rattling is unbecoming and will accomplish nothing.

Several British people, even here, don't even acknowledge that the overwhelming success of the UK's vaccine efforts are in large part due to a vaccine funded, developed and produced in the EU, and the EU's unwillingness (or inability) to prioritize its own population. In turn, they also don't acknowledge the qualitative difference of the UK's priority contracting with their own vaccine. Lacking such perspective, how would one perceive the idiocy that the EU now perpetrates?

What is happening now is a diplomatic disaster. The EU should have just published the numbers of how much vaccine was sent elsewhere, how much of the vaccine successes are due to doses produced in the EU, how the "trade balance" of vaccines looks between different countries (say with the UK), and how the EU's deficient vaccine program can be seen in that light. Then, the reader could eventually draw their own conclusion about the moral and ethical behavior of certain countries in a global pandemic.

No matter what AZ did, cutting large parts of the world off from the main supply of the most efficient vaccine is still not justifiable. And threatening this is simply absurd. Yet, the EU commission did just that. That's the shameful part.

The naive contracts are not, at least not in the bigger picture.

klelatti3• 5 years ago

Please check your facts:

If the EU had done the same with the Pfizer/BionTech vaccine, then the only countries with any vaccination success would have been the US, the EU, and whoever made a deal with either China or Russia (assuming efficacy there).

Nope. The AZ vaccine has been massively deployed in the UK - I know because several members of my family had the AZ vaccine weeks ago and long before it was approved in the EU.

So, personally, I am glad that the EU did not follow the UK with an exclusivity contract. It would have been a literal disaster for many countries, including the UK.

Completely wrong - there is no exclusivity over the AZ vaccine. AZ/Oxford have been working with manufacturers around the world to build capacity and it's being sold at cost (unlike the other vaccines). Given the lower cost and easier storage it's will be hugely deployed in the developing world.

The truth is that uniquely, the AZ vaccine's development and initial manufacturing was fully funded by the UK government and then being made at contractors to be sold at cost in 12 countries (including in the EU).

Many months later, with manufacturing in the EU having ramp-up problems, the EU commission panic about their lateness, spot doses being manufactured in the UK for the UK population and say "we'll have those" using a dubious interpretation of their contract.

Not surprising we've seen a U-turn today.

breakfastduck7• 5 years ago

EU have really shown themselves up here. Big time.

Really terrible timing to make a decision like this, too - makes it so much worse.

btbuilder2• 5 years ago

I have read a number of comments where folks state that AZ is accused of shipping doses out of EU to other markets (I assume the U.K.). However, I don’t believe any evidence of this has been presented and it is a suspicion of officials in Brussels.

WSJ reports:

“ AstraZeneca says it hasn’t sent vaccines or raw materials meant for the EU market elsewhere. The company has used a German plant to pack bulk vaccine made in the U.K. into vials and ship it back to the U.K., people familiar with the arrangement said. That “fill and finishing” step isn’t the source of bottlenecks, they said.”

https://www.wsj.com/articles/behind-astrazenecas-covid-19-va...

I am interested in any other sources for this.

pastapriest• 5 years ago

A few highlights:

1.9 “Best Reasonable Efforts” means (a) in the case of AstraZeneca, the activities and degree of effort that a company of similar size with a similarly-sized infrastructure and similar resources as AstraZeneca would undertake or use in the development and manufacture of a Vaccine at the relevant stage of development or commercialization having regard to the urgent need for a Vaccine to end a global pandemic which is resulting in serious public health issues, restrictions on personal freedoms and economic impact, across the world but taking into account efficacy and safety; and

1.15 Indicates what costs the EU will cover. Essentially EU will pay for AZ to build capacity, pays all materials, staff (incl. overtime), facility operating and AZ's admin costs (incl. legal, finance, executive, ..), regulatory filing costs, ....). So AZ comes out of the deal with no formal "profit" but new machinery, lots of staff costs paid, lots of studies paid, and all the IP.

4.2(b): Commission has the right to request all data on the production - so they will surely request this to see where doses are actually going.

5.2 and 5.4: Explicitly specified that AZ shall use its "Best Reasonable Efforts" to manufacture the Vaccine within EU - and the UK. So explicitly UK sites are included. Commission or EU countries may prod AZ to license other manufacturers to also produce further doses.

7.2 The Commission sent EUR 336 Mio when signing the contract, and (7.1) before production sends more funding to cover the cost of materials (number blacked out but 7.4 suggests that it might be up to EUR 870 Mio)

13.1(e) AZ warrants that "(e) 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 fulfillment of its obligations under this Agreement". Essentially it has no conflicting obligations for delivering those same doses. It might be difficult to identify what are the exact doses, but given that the EU transferred at least EUR 300 Mio, which in 1.15 and 7 is specified explicitly as covering all the development, capacity building, materials and production costs, it would be hard to argue that that is not a float to manufacture the first doses. This seems a difficult clause and could hang AZ if it comes out that they prioritised UK doses. See above - UK manufacturing sites were explicitly included as manufacturing sites in 5.4.

14. The EU countries indemnify AZ from any damage claims from harm caused by the vaccine's use. 15.1 also says as long as EMA has authorised the vaccine no EU country can claim damages due to safety or efficacy issues.

18.5(b) Any legal case will go before the courts in Brussels, Belgium (that's in the first instance a local court, not the Luxembourg or Hague-based ones handling EU law).

18.7 gives a force majeure clause, but explicitly excludes "defaults of service, defects in equipment or material or delays in making them available".

page 34 - signatures were made on 27 August! The beginning of the contract gives some possible delays though, if EU countries are slow to sign up.

page 40 - sadly the schedule is blacked out.

tl;dr: My takeaway from this is that AZ signed a contract that obliges them to deliver. While there's a best effort clause it's very wide. They explicitly included UK facilities as production facilities (contradicting their public claims that they only promised to use EU facilities) and committed there's no competing claim, so either signed a false warrant or the UK has no prior purchase right.

AstraZeneca/EU contract

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