Vax Contracts

 

Some interesting twists and turns going on at the moment between the EU Commission and drug firm AstraZeneca. The EU is upset that AZ is going to fail to deliver it's contracted amount of vaccine to the EU on the dates agreed, they look like they're going to miss the target by over 60%. The issue seems to be about a failure in production of some kind at several EU based plants, although production in the UK of the same vaccine seems to be progressing smoothly. This discrepancy is promulgating the idea that production of UK vaccine should be redirected to the EU in order that AZ fulfil their contract with the EU. Obvious UK folks aren't best pleased with that idea since it would mean a probable shortfall in the number of doses available in the UK.

Interestingly (if you're interested in this kind of thing) the actual contract between AZ and the EU has been made public, I've been reading through it and paragraph 5.4 would seem to me to be the most relevant section in this dispute (it's a big document so there are other relevant sections) See below for a truncated version of this section and see what you think for yourself.

5.4 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) 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, CMO’s within the EU capable of manufacturing the Vaccine doses, and AstraZeneca shall use its Best Reasonable Efforts to contract with such proposed CMO’s to increase the available manufacturing capacity within the EU.

As you can see the language used (typical for supply contracts) uses the phrase "Best Reasonable Efforts", if I were on the board of AZ this would be my "get-out-of-jail-free" card, so long as they can prove that they made "best reasonable efforts" to manufacture the agreed quantities then surely this clause applies and the remedy should be that alternative manufacturing sites within the EU should be ramped up (with inevitable delay?). It seems to me that the UK is more of a "fringe" concern, and in order to supply from there the EU seems to want AZ to jump through some administrative hoops first?

We should all be awaiting the resolution of this dispute with interest, I suspect it will hold the key to the continued run-rate of vaccination in the UK!