Preparing legal case

EU preparing legal case against AstraZeneca over vaccine shortfalls

BY JILLIAN DEUTSCH AND JACOPO BARIGAZZI

The European Commission is getting ready to launch legal proceedings against vaccine producer AstraZeneca, according to six EU diplomats. 

The Commission raised the matter at a meeting of EU ambassadors Wednesday, during which the majority of EU countries said they would support suing the company on the grounds that it massively under-delivered pledged coronavirus vaccine doses to the bloc.

However, five to six countries, including large states like Germany and France, raised concerns about launching a lawsuit against AstraZeneca, according to several diplomats. One of the concerns, as one diplomat explained, is that a lawsuit wouldn't guarantee that the EU got more doses.

"What can we do in practical terms if AstraZeneca says, 'Take a closer look at our production sites: We just have no vaccines,'" the diplomat said, adding that some countries were "not assured this is enforceable."

Further, some ambassadors warned that a lawsuit would further diminish citizens’ trust in the vaccine because it would sully the image of AstraZeneca, according to the diplomat. In "emotional terms," the diplomat said the Commission understandably wants to hit back at the vaccine producer over the delivery shortfalls — but added that the company is also needed in the global response against COVID-19. 

According to some of the diplomats, the Commission also hasn't elaborated to EU countries on its legal reasoning for such a move, prompting intense debate at the meeting. One diplomat said the lawsuit would address the company’s failure to meet the deliveries schedule set out in its EU advance-purchasing agreement, while another said the point is to make it mandatory for AstraZeneca to provide the doses set out in its EU contract.

Another point of contention among some countries is that the issue is not just contractual but political — and as such, requires member countries to be more involved in the contracts that the Commission negotiates with companies.

AstraZeneca stoked the ire of the EU in January when it admitted it couldn't ship to the bloc the number of doses initially anticipated. By the end of the first quarter, the company delivered just 30 million doses to EU countries, rather than the 100 million doses pledged in its EU contract. The shortages severely hampered vaccination campaigns across EU countries. 

The company has projected it'll deliver roughly 70 million doses by the end of the second quarter of this year, when it was supposed to have delivered the entire 300 million doses secured in the EU contract.

Timing issues

According to one of the meeting participants, the Commission said it wants to file a lawsuit in Belgian court by this Friday and is awaiting formal sign-off from EU countries. But some of the countries who have doubts voiced concerns about the tight deadline.

The Commission has also noted it has already sent a formal notice to AstraZeneca after the company failed to commit to supplying 90 million doses to the bloc in June, according to the same meeting participant.  

However, it's unclear whether the Commission would move forward with the lawsuit if several member countries, including Germany and France, don't support it. Several diplomats argued that the Commission doesn’t need the support of members to go ahead, but politically, it would be better to have their full support because the move could backfire on member countries if it doesn't succeed.

A Commission spokesperson declined to offer specifics on Thursday, saying that “no decision has yet been taken” on the lawsuit and pointing out that there’s already an ongoing conflict-resolution procedure with the company. He noted, however, “the issue isn’t resolved yet,” and added, “Together with member states we are looking at all options” to make sure deliveries take place.

“Whatever steps are taken or will be taken, these decisions will be taken by the Commission together with member states,” he said.

In any event, the chances of any more contracts with AstraZeneca look increasingly dim. The same Commission spokesperson stated that the deadline for the EU to exercise its option to sign a contract for another 100 million doses had expired and would therefore be void.

AstraZeneca wasn't immediately available for comment.

EU countries also discussed on Wednesday contracts for more EU vaccines, following the Commission’s announcement last week that the EU secured 1.8 billion BioNTech/Pfizer vaccines through 2023. Some ambassadors worried that the EU essentially is giving Pfizer a “monopoly,” and said the EU needs to have a broad portfolio of vaccines, according to a diplomat. There was also some support for extending the contract with Johnson & Johnson, but this has not yet been confirmed by the Commission. 

Another topic of discussion was export controls on vaccines. A few export-reliant countries warned that the controls will disincentivize foreign investment because they're seen as creating a “Fortress Europe.” But other countries were largely in support of maintaining the measures.