Quite extraordinary scenes being played out in Europe as the EU struggles to get going with the rollout of COVID-19 vaccines.
Aside from the somewhat unbecoming language of the EU justice commissioner, Didier Reynders, and his warning of a "vaccine war", we have had the EU publish its contract with AstraZeneca and commission chief Ursula von der Leyen give us her interpretation of it on German radio station, Deutschlandfunk:
“There are binding orders and the contract is crystal clear,” she said.
So what does the contract say? The recitals (the ordinarily non-binding part of an agreement which sets out the scope of the actual agreement to follow) provide that "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 Astra Zeneca for distribution within the EU.”
Ms von der Leyden’s claim is that the “best effort” clause was supposed to refer to the period during which the company was developing the vaccine. “This is now in the past … Once a vaccine is there, there were very clear rules regarding amounts as well as timeframes – they are in the contract – and there are also locations where the vaccine should be produced.”
That would seem a bit of a stretch, and of course there are politics involved.
But the extract clearly talks of the manufacture of 300million doses, and not development. After development, there has to be manufacture, and AstraZeneca’s position is that it will use best reasonable efforts to hit those targets, although it’s falling short as things stand.
It has been suggested that AstraZeneca’s efforts are constrained by its agreement with the UK Government that its vaccines manufactured in the UK are to be delivered in meeting the UK order first.
That contract has not been published.
However, if that is the case, is it a legitimate “get-out” for AstraZeneca and its commitment to the EU to use its 'best reasonable efforts' in fulfilling the EU order – i.e., “we will use our best reasonable efforts to provide 300million doses to you, subject (perhaps unspoken) to our commitment to meet UK demand out of UK facilities first”? The EU doesn’t think so, but the question may be moot.
If you read further into the agreement, the operative clause 5.1 provides that “AstraZeneca shall use its Best Reasonable Efforts to manufacture the Initial Europe Doses within the EU for distribution”. An inference may be drawn that a distinction was intended between the EU and UK manufacturing bases.
Shortage of supply is being blamed on the bases in Belgium and the Netherlands.
Add to this the fact that the actual definition of “best reasonable efforts” in the contract is extremely open, it would seem that there is no easy contractual solution for the EU — which is perhaps why its preference is to debate this in the political rather than judicial theatre.
The company's chief executive, Pascal Soriot, said in an interview earlier this week that the contract obliged AstraZeneca to make its "best effort" to meet EU demand, without compelling the company to stick to a specific timetable - an assertion disputed by the EU.