AstraZeneca says EU loses legal bid for more vaccine

[EasterIssland]

AstraZeneca says EU loses legal bid for more vaccine supplies by end-June

AstraZeneca (AZN.L) on Friday said the European Union had lost a legal case against the pharmaceutical firm over the supply of COVID-19 vaccines as a court in Brussels rejected an EU request for more deliveries by the end of June.

The Anglo-Swedish firm committed in a contract to do its best to deliver to the 27-nation bloc 300 million doses by the end of June, but production problems led the pharmaceutical company to revise down its target to 100 million vaccines.

The cuts in the supplies delayed the EU's vaccination drive in the first quarter of the year, when the bloc had initially bet on AstraZeneca to deliver the largest volume of jabs. That led to a bitter dispute and to the EU's legal action to get at least 120 million doses by the end of June.

But the judge said the company should only deliver 80.2 million doses by a deadline of Sept. 27, AstraZeneca said.

www.reuters.com/business/healthcare-pharmaceuticals/astrazeneca-says-eu-loses-legal-bid-more-vaccine-supplies-by-end-june-2021-06-18/

@Wakeupin2022

Anna it may be a good article but just seeing the name of the paper makes me doubt it! The UK press are awful but the European press too and this German paper printed a dangerously incorrect article earlier this year.

True. Can be biased

Interesting Twitter thread here on the way the judgment was portrayed by the UK press as an AZ 'win' v what the judgment actually said

twitter.com/hhesterm/status/1405890767957250055

Another one here

twitter.com/NaomiOhReally/status/1405889754814726147

Can be biased?! All press can be biased, that’s why it’s useful to have the actual court judgement, and a working knowledge of other languages. I am amazed that nobody here is showing even a modicum of concern about the printing of wrong information, whatever their thoughts are of vaccines/eu/az.

TL:DR, here is a google translation of the court docs screenshots that are on Twitter. I can see why both sides are claiming a win because the judge says that AZ deliberately broke their contractual agreements, but also doesn’t give much penalty. You can also see where the 70/30 selective reporting came from. So they had to deliberately break the EU contract in order to fulfil the UK contract. It’s very sad because it’s a small company which did an amazing thing caught up in brexit and politicians, but I think Matt “it’s called contract law” Hancock must have known the two contracts would be incompatible and was quite happy to let the international reputation of said small company suffer so he could look good.

Here is googles translation:

Given the magnitude of the delays and the difficulties encountered by the Novasep and Catalent manufacturing sites, a normally diligent and prudent pharmaceutical company placed in the same circumstances of a health crisis would not have deliberately chosen to deprive the EUROPEAN UNION of any supply of the most profitable contract manufacturing site, as ASTRAZENECA has done. A marginal examination of this file shows that in doing so, ASTRAZENECA did not make its "Best Reasonable Efforts" to manufacture and deliver some of the promised 300 million doses within the expected timeframe. 47. The fact that ASTRAZENECA attempted to find solutions to increase its delivery capacity - by expanding its international network - does not in any way detract from the analysis that it voluntarily deprived itself of its source of supply. more profitable. This is all the more true as the solutions envisaged - which were otherwise unsuccessful - seemed to be envisaged by the parties to the APA only as an ancillary measure, the preference being clearly focused on production in the territory of the European Union fictitiously the United Kingdom. As for the obligation not to enter into any competing obligations vis - à - vis third parties, which impedes full compliance with the APA 's contractual obligations. 48. Its conduct appears all the more erroneous because in i accordance with Article 13.1 (e) of the APA, ASTRAZENECA had guaranteed “that it is not subject to any obligation, contractual or otherwise, to any Person or third party who concerns European Initial Doses or which is incompatible with or substantially inconsistent with the terms of this Agreement or which would impede full compliance with its obligations under this Agreement ”. However, by reason of identity with those set out above, it appears that the delay in delivery is partly due to the fact that ASTRAZENECA has entered into and executed as a matter of priority the obligations vis-à-vis the United Kingdom, which have been entered into. substantially in conflict with the APA and hampered full compliance with its obligations. In so doing, ASTRAZENECA allegedly deliberately breached its contractual guarantee, contained in Article 13.1 (e) of the APA. The fact that this guarantee is a style clause has been unchanged during negotiations and / or emanates from one of the particular contractors does not deprive it of its binding nature.

46. It follows from the above that the process leading to the conclusion of the APA appears to demonstrate that ASTRAZENECA had to provide its “Best Reasonable Efforts” to use the Halix and Oxford Biomedica manufacturing sites to the extent that such use proved necessary to meet the contractually promised estimated schedule. However, ASTRAZENECA justifies that it never assigned the Oxford Biomedica site to European production and that it delivered part of the production of the Halix site to the United Kingdom due to a supply contract. formalized and signed on 18 and 28 August 2020. It appears, therefore, that ASTRAZENECA intentionally chose not to use the means at its disposal to manufacture and deliver the disputed vaccines, as the delay in its estimated schedule became more severe and the difference between doses delivered and those expected became increasingly important. The choice to monopolize the Oxford Biomedica site for the benefit of the United Kingdom and thus to deprive the EUROPEAN UNION of a manufacturing site, however expressly provided, seems all the more detrimental as its performance is more than double that of that of Novasep, Catalent or Halix (Exhibit 31 of the ASTRAZENECA file).

It is not disputed that if ASTRAZENECA is able to comply with the APA with the manufacture of a single manufacturing site, the doses produced by the other sites could be allocated to third parties without reservation. On the other hand, as soon as this first site fails to manufacture sufficient doses over time to comply with the APA, ASTRAZENECA seems required to provide its "Best Reasonable Efforts" to reorganize the manufacture of the other Annex A sites. including that of Oxford Biomedica. In view of Article 13.1 (e) of the APA, the common intention of the parties appears to be to deprive ASTRAZENECA of being able to claim that the production capacity of the other sites listed in Annex A cannot be used because they are dedicated to the performance of incompatible and undeclared obligations that ASTRAZENECA also assumes. In other words, the priority supply obligation vis-à-vis the United Kingdom appears to be a reason incompatible with the "Best Reasonable Efforts" that ASTRAZENECA undertook to carry out in the implementation of the APA.

80. In the present case, each of the parties fails in part in its respective claims. We will order partial compensation of the costs, deciding that ASTRAZENECA will, in view of the respective failure of the parties, be required to pay 30% of the requested procedural allowance. Given the complexity of the present case, it is justified to calculate this percentage on the basis of a maximum procedural allowance of € 12,000 as requested. ASTRAZENECA will also be required to reimburse to the EUROPEAN UNION the following uncontested costs, which amount to € 830.11 broken down as follows: registration fees (abbreviation of the time limit for citation): € 165, request for abbreviation to quote: € 20, quote: € 438.88, bailiff availability: € 206.23. The expenses will therefore be taxed in the head of the EUROPEAN UNION at (€ 4,000 + € 830.11) € 4,830.11. ASTRAZENECA and the EUROPEAN UNION should also be ordered to pay up to 70% and 30% respectively.

So the Guardian was right it is 30%

I don’t know, I am not a lawyer, but I can read French and have translated it for you. AstraZeneca and Eu 70% and 30% respectively. Respectively means “in that order. But cleverer people than me (as as Americans more impartial) are saying the guardian isn’t right? I don’t know.

Not sure if this report has been here yet, apologies if it already has:

www.politico.eu/article/court-ruling-in-astrazeneca-commission-vaccine-coronavirus-covid19-case-gives-something-to-both-sides/

I wonder if there may be a difference between the "procedural allowance" (= court costs) and the parties' own legal costs. The court could have made different orders for each component. So perhaps AZ pay 70% court costs and 30% EU legal costs? Bearing in mind that many jurisdictions dont generally order payment of parties' legal costs, this might be an explanation, and would reflect AZ's failure on the breach of contract issues. I'm guessing though!

Oh maybe @CryingAtTheDiscotheque

I really hate selective reporting (and selective reading) and in the case of my toddler, selective listening!

@QuentininQuarantino

Can be biased?! All press can be biased, that’s why it’s useful to have the actual court judgement, and a working knowledge of other languages. I am amazed that nobody here is showing even a modicum of concern about the printing of wrong information, whatever their thoughts are of vaccines/eu/az.

Yes they can I didn’t suggest they weren’t and isn’t that why we’re trying to figure out the correct version? Not sure why you’d say no one cares.

I was agreeing with you @MarshaBradyo - admittedly intonation is lost over typed.

What do you make of that translated legalese?

WRT press bias though, it really does seem that nobody cares, nobody challenges it, as long as it says what people want to hear. Look at the Daniel Morgan murder, Brexit, the royal family. It’s so depressing.

Quentin I skipped to pay part and there’s a lot of detail on breakdown of low costs but then the last line seems pretty important to me - ASTRAZENECA and the EUROPEAN UNION should also be ordered to pay up to 70% and 30% respectively.

Not sure what of though so not sure what it means in figures

Agree re bias, I think it helps to look at which media is saying what they are and filter through their agenda plus try to get direct quote or source. Not perfect but better than headlines etc

Thinking on it - If it means of legal fees then I’d say AZ is taking larger cost (not a legal view though, others may know more)

So they had to deliberately break the EU contract in order to fulfil the UK contract. It’s very sad because it’s a small company which did an amazing thing caught up in brexit and politicians, but I think Matt “it’s called contract law” Hancock must have known the two contracts would be incompatible and was quite happy to let the international reputation of said small company suffer so he could look good

Thanks to the posters who are discussing bias and giving links to official sources.

Looking back at how people acted...

I don't see how the EU could have gone differently about things - faced with a company that breached a contract which lead to loss of life. My grandmother would be one of those...

The UK was very happy, receiving as many jabs as possible which made the government look good, and spinning the usual anti EU narrative.

AZ... why did they act as they did? There was always going to be a fallout from letting down a massive customer so badly. And would things have gone differently had they been upfront about favouring one customer over another? How do they move on from this? Having a court judgement stating that you were in serious breach of contract is not great PR - but still they spin, there is no acknowledgement or remorse.

Not that the British media care about any of this.

This is all somewhat theoretical until I've read the full judgement professionally translated, but it seems to me that who can be said to have won depends very much on what each side was trying to achieve.

I know the EU's stated position was that their legal action was about securing more doses. If that is the case, then they have lost. They have not secured any more doses. The amount Az have been directed to supply is substantially lower than the EU were going to get anyway.

I am aware that the lawyers representing the EU have been instructed to say the action sped up Az's supplying doses, but I see no evidence for that at all. Az has been churning doses out of it's EU based plants and sending them out as they came off the production line. Until I see evidence that the action spurred Az to - for example - increase production lines at those factories then I think this argument is political spin.

However, a number of us speculated on the previous thread that securing more doses could not be the motivation. That the numbers and the time-frames simply did not add up. We speculated that the motivation for the EU bringing the case was political gain - to pass the blame for the slow rollout onto Az, and to provide political coverage for the politicians who might otherwise be blamed for that rollout.

By that measure, the EU can reasonably said to have won. They have secured their moral victory. I can see why UVdL is delighted.

Whether it was worth the undoubtedly vast sums they paid their lawyers is ultimately something only they (and the taxpayers who funded it) can decide.

In contrast, as far as I can tell Az's aim was mostly not to be forced into a position where they were directed to supply doses they did not have, and thus face financial penalties. By that measure, I totally see why they are claiming victory. Yes, they have suffered reputational damage but, IMHO, that damage was baked in by the spin no matter the outcome of the case.

My thoughts are basically unchanged from the previous thread. The real winners are the lawyers, who will have earned large fees, and got a prestigious case to put on their CV. The real losers are us, for noone will ever make a not for profit vaccine again.

Interesting times...

Really good summary post Motorina and agree on your last line re not for profit vaccine

The real losers are us, for noone will ever make a not for profit vaccine again

what has the profit angle got to do with this case? if AZ were charging £100 per vaccine, the judgement would still have been the same.

No company will do it again because it was a stupid thing to do.

@Bluethrough

The real losers are us, for noone will ever make a not for profit vaccine again

what has the profit angle got to do with this case? if AZ were charging £100 per vaccine, the judgement would still have been the same.

No company will do it again because it was a stupid thing to do.

Why a stupid thing to do? No upsides?

@Bluethrough

The real losers are us, for noone will ever make a not for profit vaccine again

what has the profit angle got to do with this case? if AZ were charging £100 per vaccine, the judgement would still have been the same.

No company will do it again because it was a stupid thing to do.

Trying to make a vaccine as cheap as possible so that it reaches as many people as possible so that everyone is vaccinated is a stupid thing to do ? We’re lucky we live in a country who can afford pfizer and the conditions pfizer can be stored at. Some other countries don’t have that luck

The real losers are us, for noone will ever make a not for profit vaccine again.

None of this is about the basis the vaccine was developed on.

It's about AZ's inability to increase production as planned, and their failure to renegotiate and resolve this with a customer, to the extent that it ended up in court where they were found to be in serious breach of contract.

This could have happened to any provider, for-profit or otherwise.

The AZ vaccine is for cost, yet that hasn't stopped the west from taking all the supplies & the developing world getting virtually none! AZ should have charged for this, why should the 5th richest country in the world get vaccines for cost?

AZ could then have used these profits to increase production facilities the world over, train and administer to dev countries.

Plus the huge profits generated would have been taxed, helping our economy and giving AZ more money for next generation vaccines and more funding for the Oxford teams.

But my main point was that the "for cost" argument made by Motorina had no bearing on the court case - issues with the contract would still have occured.

This is about Brexit - nothing more nothing less.

The EU were made to look like fools initially because the UK had vaccine and they didn't.

It doesn't matter that the UK worked really hard to get that vaccine, it doesn't matter if a UK based company made that Intellectual Property readily available to many regions in the world including the EU.

None of this matters - the UK by doing much if the above whilst the EU were arguing over price got a significant head start and boy did the EU need to make the UK or the company associated with the UK pay.

They were caught sleeping by the time they woke up it was too late. VdL is not one who takes the blame for any of her mistakes.

I say all of the above as someone who wishes the UK was still in the EU. And someone who despises the UK govt.

There have been many lives lost throughout the continent.

Any vaccine redirected from UK to EU would have potentially have cost the live of a person in the UK.

And vice versa.

Why should the 5th richest country in the world get vaccines for cost?

Rightly or wrongly, perhaps it's because we were the ones who put up so much of the money for the research and development?

There's a case to be made for supplying developing countries, but before plunging in it might be worth making sure vaccines would actually get to the population first, rather than being sold by corrupt officials and the money salted away in Switzerland

And yes, as said before I'm well aware developing nations aren't the only ones with officials who behave illegally - see Gove, Hancock et al

@Wakeupin2022

AZ isn't a state owned company - i really do fail to see any connection with Brexit.

Had the EU not stepped in to procure vaccines, then we would have had 27 states all trying to get vaccine and the rich ones - Germany France etc would now have hi rates and poor countries very low rates of supply and doses given.

Not ideal situation in a economic and travel area where there is little in the way of internal border control - imho the EU had to step in and that obviously causes delay but in a good way.

The EU appear to have a genuine belief they have been conned by AZ and the court case seems to in part agree.