Why has the European Union brought legal action against the pharmaceutical AstraZeneca?

The European Commission has taken legal action against AstraZeneca for what it considers a failure in the “delivery on time” of the doses of the vaccine against the coronavirus.

The drastic measure comes after weeks of tension, criticism and accusations between Brussels and the Anglo-Swedish company, which have largely played out in public opinion.

Euronews explains how the European Union and AstraZeneca have reached such a low point in their relationship.

What are the original conditions of the contract?

The European Commission reached an agreement with AstraZeneca in August last year to purchase 300 million doses of its coronavirus vaccine. The agreement was signed on behalf of the 27 Member States and included a purchase option for an additional 100 million doses. The 300 million doses were expected to be delivered throughout 2021.

AstraZeneca had developed the vaccine in collaboration with the University of Oxford using viral vector technology. This technique uses a modified version of a different virus (the vector) to deliver important instructions to human cells in order to boost immunity.

The Anglo-Swedish company presented its vaccine as an affordable and easy-to-handle alternative to those made by Pfizer-BioNTech and Moderna, which are based on complex mRNA technology and require extreme cold storage. In contrast, AstraZeneca’s can be stored in normal refrigerators at temperatures between 2 and 8 degrees Celsius.

According to a table leaked last year by a Belgian official, the European Commission had to pay 1.78 euros for each dose of AstraZeneca, a significant difference from the price of 12 euros negotiated with Pfizer-BioNTech. This made the vaccine an attractive option for budget-conscious EU countries such as Bulgaria, Croatia and the Netherlands.

What happened to the deliveries?

The EU began its vaccine rollout in late December, in what European Commission President Ursula von der Leyen called “V-Day.” But it was clear early on that AstraZeneca was struggling to meet the promised delivery schedule for the first quarter of 2021, which amounted to 90 million doses. The company made several announcements in January, lowering its targets to 30 million doses.

The news angered the European Commission and caused consternation among national governments, which had planned the first phase of their inoculation campaign around the AstraZeneca and Pfizer vaccines. Soon, officials publicly accused the company of shipping doses produced at EU-based plants to the UK, to the detriment of the European Union.

Just a month after “V-Day,” the European Commission introduced an export control mechanism to increase scrutiny over intra-bloc vaccine production, a move that was widely seen as a forceful attempt to redirect doses of AstraZeneca to EU countries. Weeks later, Italy blocked a shipment of 250,000 doses bound for Australia.

AstraZeneca’s distribution suffered another setback when many European countries decided to stop using the vaccine to investigate very rare cases of blood clots. The European Medicines Agency later discovered a “possible link” between the AstraZeneca product and the disease, but insisted that the benefits of using the vaccine still outweigh the risks. Inoculation with AstraZeneca was resumed in most EU countries, albeit with limitations.

Why is the European Commission now taking legal action?

According to the latest figures from the European Center for Disease Prevention and Control (ECDC), AstraZeneca has so far delivered 31.33 million doses to the European Union.

Not only does the figure represent a substantial cut from the 90 million doses initially forecast for the first quarter, but it casts serious doubts on the company’s ability to meet the 180 million second-quarter target.

The European Commission estimates that, in the best of cases, the company will supply the block with 70 million doses between the beginning of April and the end of June.

But it seems that progress is not being made. The gap between expectations and reality has become untenable for Brussels, forcing the Executive to sue the company in a last resort attempt to comply.

The case has been brought before a court in Brussels and will be resolved in accordance with Belgian law. The decision to proceed with the legal action was made by consensus with the 27 member states.

What do we know about the case?

A spokesperson for the European Commission confirmed to Euronews that the case has been presented as a request for precautionary measures. This term describes the procedures that provide a temporary or provisional decision on a contentious matter.

The spokesperson said that the aim of the European Commission is to convince the judge that AstraZeneca has breached its contractual obligations. The executive trusts that a ruling will force the company to accelerate production and guarantee at least 70 million doses for the second quarter, a figure that he considers the minimum.

“What matters most now is that the company guarantees the delivery of a sufficient number of doses,” the spokesperson explained.

Geert Van Calster, a Belgian lawyer and legal scholar at KU Leuven, told Euronews that urgent procedures for agreements to purchase goods and services are “clearly unusual”.

“I suspect that what you expect [la Comisión] are two things. First, for a judge to officially rule that AstraZeneca has not committed to what it contractually committed to, “said Van Calster.

“And secondly, that the Commission and the Member States may try to achieve one or two very concrete measures in a very short time. In particular, I suspect that what the Commission will try is to convince the judge that, according to the contract, There are a number of vaccines that should have been delivered to the European Union and that have not, and consequently those vaccines that are available, especially in factories outside the European Union, still have to be delivered by AstraZeneca to EU member states “.

How has AstraZeneca defended itself?

The company “regrets” the decision of the European Commission and believes that “any litigation is unfounded”, but nevertheless welcomes the “opportunity to resolve this dispute as soon as possible”.

In a statement, AstraZeneca argued that it has, in fact, honored the contract and will deliver “almost 50 million doses to European countries by the end of April.”

“Vaccines are difficult to manufacture, as demonstrated by the supply challenges faced by various companies in Europe and around the world. We are making progress in solving technical problems and our production is improving, but the production cycle of a vaccine is very long, which means that these improvements take time to translate into an increase in the doses of finished vaccines, “said the company, echoing a line of defense used by its CEO, Pascal Soriot, during a hearing before Members of the European Parliament.

When can we expect a resolution of the case?

By opting for an urgent procedure, the European Commission expects a speedy resolution.

A spokesperson told Euronews that the Executive expects the judge to issue a sentence “within three to seven weeks from the filing of the claim,” a period that Van Calster also considers feasible provided the judge considers that there is merit in the claim. case.

“The idea is to go to a fast procedure of measures that can be dictated quickly, because there is also the possibility of a long-term procedure that decides on the entire contract,” said the academic, noting that Belgian courts are usually slow when it comes to deals with in-depth exams.

“This is precisely why the Commission has opted for the emergency procedure. The disadvantage of this precautionary procedure is that you cannot ask a judge to review the beginning of the contract. You are going to have to ask the judge to only reach conclusions that are clearly easy to do on the basis of the provisions that, according to you, have no doubt. “

The Commission believes that it has enough good arguments to make the judge rule in its favor. Meanwhile, AstraZeneca has said it will “defend itself firmly in court.”

The first hearing of the case will take place on Wednesday.

Will the European Commission continue to do business with AstraZeneca?

As things stand, it seems highly unlikely.

The Commission decided not to activate the provision to request an additional 100 million doses from AstraZeneca, a decision that cannot be reversed as the deadline has already passed. Brussels is now focused on making sure the original 300 million doses are actually delivered in the coming months.

Brussels has been able to partially compensate for the AstraZeneca shortage by making greater use of Pfizer and BioNTech, whose EU-based production plants have progressively increased their capacity thanks to a joint public-private effort.

The positive results of the partnerships have led the Commission to put even more money on the table for mRNA vaccines. The Executive has entered into negotiations with Pfizer and BioNTech to ensure up to 1.8 billion doses during the period from 2021 to 2023. The agreement aims to provide boosters and vaccines adapted to the new variants.