France and Germany threaten AstraZeneca over vaccine shortage
theguardian.com
theguardian.com
Reality: “The UK government signed a contract with AstraZeneca three months before the commission.”
Why does the EU have to be so stupid?
European production of the AZ vaccine has fallen short, and the rest of their sourcing options fell through as well.
Even if you accept that AZ has country based supply chains with different priorities, it still makes sense that the EU would want to know if the EU production is being shipped to other locations.
I keep seeing this argument being thrown around, the other is that the UK funded vaccine research - like any of this invalidates the contract and deadlines signed between EU and AZ.
Politicians have a magic thinking that because they will demand fulfilment of the contract, the extra doses will miraculously appear. It's not how it works, the only way to get them is to take them away from the UK. It might or might not be fair to share UK doses with EU considering that this is a global pandemic but that is completely different discussion unrelated to the signed contracts.
Looking is at this from legal perspective only is not helpful. The following events, like the EU backtracking on North Ireland export ban, clearly show this. We need cooler heads prevailing.
The elephant in the room is that there might be indeed an export ban of vaccines manufactured in the UK, disguised as contract obligations.
Yet when EU mentioned export ban it became some sort of "hostility", while AZ doing it with UK isn't hostility but contract obligations?
What if EU slapped in the contracts that all BioNTech production would be all for Europe first due to the contract obligations? As long as it's hidden from public it's not an export ban, right?
All of this does indeed sound like politics, smoke and mirrors. So I hope AZ gets squeezed to at least make it clear that some contracts are being privileged over others.
Again, it is not contracts that can miraculously create more doses now. It was only because of investments done before. AZ is doing this for non-profit (a big mistake in my opinion), so what can you squeeze out of that?
In fact, the EU should have invested even more, make them to build even larger facilities with more bioreactors that in case of low yield they would still have more doses. But it is all in hindsight, so not very useful to say it now.
The UK is not privileged because their sites had the same issues with the first batches. The only difference is that they started 3 months earlier.
Oh wow. I haven't been following closely. But Why? They should have made at least some profits. And use those for R&D.
And if it was done for Non-Profits, why did it take the EU another 3 Months to put a stamp on it?
And honestly it is very common to have Supply from different site for different region for all sort of reason. Transportation cost, safety, Time to Delivery etc. If everything you said were true ( and I dont have time to Fact Check everything ), then EU has only themselves to blame.
The UK took other risks – even with the Pfizer vaccine they used all supplies to give as first doses to more people. That was a risk but they calculated that it is better to have more people with partial immunity than less people with stronger immunity. The EU mostly put aside the second dose to give strictly according to the schedule.
Their regulators approved vaccines several weeks, even one month before the EU. Again they were criticized for this as being reckless. We cannot even say that their risk has paid off yet because they are in lockdown just like the EU.
It is unfortunate that AZ cannot deliver enough vaccines now but many EU politicians and health regulators (France, Germany) have expressed doubts about AZ vaccine indication for elderly. So, maybe they are not that eager to receive all these supplies after all. Charitable explanation would be that they do this to calm people's anger about missed deliveries.
Why are you insisting on 12 weeks difference in a contract celebration when the issue at hands is AZ failing to fulfill their commitment - and it's not by a short amount, but by more than 50%+.
If they "saw it as a separate supply chain" then they shouldn't have added to the contract that it wouldn't matter where the vaccines were produced, right?
And saying that's a technicality when they are hiding behind the quote "best possible effort". They basically can claim they are doing their best effort while they have plenty of stock being made, and not shipping it.
>Again, it is not contracts that can miraculously create more doses now. It was only because of investments done before. AZ is doing this for non-profit (a big mistake in my opinion), so what can you squeeze out of that?
>In fact, the EU should have invested even more, make them to build even larger facilities with more bioreactors that in case of low yield they would still have more doses. But it is all in hindsight, so not very useful to say it now.
Then maybe AZ should have made arrangements, or asked for help, if they saw they weren't going to be able to fulfill the orders - or maybe they were expecting to move orders from UK, yet they were blocked? Who knows, right?
EU released the contract, they are not hiding. So if AZ is hiding something, they should come forward or face the consequences.
>The UK is not privileged because their sites had the same issues with the first batches. The only difference is that they started 3 months earlier.
Again I see no relevance in this, AZ signed a contract and committed to a deadline which they are failing by A LOT! I'm not saying UK is privileged or not, this is the contract between AZ and EU - now if UK is blocking AZ from exporting vaccines, let it be said out loud and let's all be transparent. If AZ is fulfilling UK contract and shitting on EU contract, then they are the ones privileging UK.
EU is asking for transparency. One thing is AZ fulfilling all contracts by less than 50%. Other thing is some countries get 90% of fulfillment, and EU gets 30%.
They really believed that they will be able to manufacture all the doses in time. They had a bad luck. But again a year ago most didn't even believe that such vaccine is possible, so they deserve credit for their efforts. Their vaccine appears effective – most importantly the vaccine completely eliminated hospitalizations and deaths. The value of their product is very high and they are not even making profit from it.
>> Then maybe AZ should have made arrangements, or asked for help, if they saw they weren't going to be able to fulfill the orders - or maybe they were expecting to move orders from UK, yet they were blocked? Who knows, right?
I don't think there is any conspiracy. From AstraZeneca's point they want to produce as much vaccine and as fast as possible and to give it to all countries. Taking manufactured vaccines from one country and giving them to another doesn't magically increase the amount of available vaccines, so the value of that is low so they are not going to do it unless really necessary.
Maybe the argument is that the UK has already vaccinated their risk groups and their urgency is lower, so they could give more vaccine now to the EU. This is the argument from the WHO as well. I even partially agree to this, although I am a little bit suspicious about the WHO as they haven't been very efficient during this pandemic. But at least it makes sense unlike all these talks about sanctity of (unclearly written) contracts.
Again, one thing is missing by less then half, other thing is more then half while fulfilling almost fully orders for other countries.
So, clearly some contracts have more value then others, or there are blocks in place.
Trump was pretty explicit and transparent about it: issued an executive order mandating all USA orders to have priority for USA. This is something tangible that can be worked with. What about UK? Why don't they come forward and say they also have a block for vaccine exports?
Or it's only the EU that's "hostile" for doing it now?
>I don't think there is any conspiracy.
This isn't a conspiracy at all. It's binary: AZ can't, or won't, move stock from UK.
I am not following the argument. Are the UK government under any obligation to disclose that to EU?
>> It's binary: AZ can't, or won't, move stock from UK.
Let just say AZ demand a price increase for moving stock from UK, then what? When the contract for that price was signed, even though it did not explicitly state from which plant, the price are considered as a factor for production location. Hence the best effort. Morale issues aside this is no different to literally all supply chain in other industry.
I don't think I get the question... is a country obliged to say they won't export something to other country? I guess so, how the hell is the other country supposed to know?
Because that's literally what Europe is saying: get the missing stock somewhere else, because there are nothing stopping AZ from doing it.
>Let just say AZ demand a price increase for moving stock from UK, then what? When the contract for that price was signed, even though it did not explicitly state from which plant, the price are considered as a factor for production location. Hence the best effort. Morale issues aside this is no different to literally all supply chain in other industry.
Well AZ is the one that told 2 days ago that it won't fulfill a order of 100 million doses due to March, 30-60 days away, by 70 million, so I guess they are the ones that should figure out that fuck up, if they have to do it at loss or if they have to ask more for it.
They only figured out 2 days ago they will slip a order by 70%, and hide behind their "best effort"? They had be preparing this shipment since at October 2020, at best November 2020 - and only now they figure out they will miss out on it?
Again, something doesn't add up. The EU could have done a lot more if they knew they couldn't have fulfilled this order.
Again, why should they export it? When the whole UK site was paid and set up by UK government before it was handed to AZ for further development.
There are no obligations from AZ to fulfil that order from another plant.
It is the same with Silicon Wafer, Foods, Metals. If you want something specific, production has to be planned ahead in advance.
>Well AZ is the one that told 2 days ago that it won't fulfill a order of 100 million doses due to March
Which is absolutely normal if their yield aren't up to standard. It is new, sometimes things dont work. I dont have any experience with Vaccine Production but these things takes time. Supply Chain and Production basics and fundamentals are nearly the same across all industries. Which is the same thing with Germans complaining about TSMC holding up Wafer capacity from their Cars manufacturers. What lots of Bollocks.
Worth pointing out again, they are doing this at "Cost".
I am in agreement with NoPie. Should the UK share some of its vaccine to its neighbour for good gestures? Yes. Are they obliged to do so? No.
>Which is absolutely normal if their yield aren't up to standard.
So all the 100 million vaccines was going to come out of a yield that showed results... 2 days ago. I wasn't aware they make such volume of vaccines in one sitting.
UK are being delivered 2 million vaccines per week, and for EU they make batches of 100 million?
They did very well, all things considered. Normally setting up such manufacturing takes years. They didn't screw up. Just having some teething problems that will soon be solved.
AZ told the EU, 2 days ago, that the order to be delivered by March is missing 70 MILLION OUT OF 100 MILLION doses.
This order takes MONTHS to prepare - just to put it in perspective. Imagine a production capacity of 2.000.000 doses per week, it would take AZ 50 WEEKS TO FULFILL THIS ORDER.
And 8 weeks before delivery is when they realize that they will miss the delivery by 70.000.000 doses? Are you kidding me?
70.000.000 is enough to give immunize plenty of European countries alone, and they remember to notify the EU few weeks before their delivery.
Biologics are messy. It is not chemical synthesis that is easy to assay and finetune. They are growing live modified viruses. No one has made such vaccine before. Pfizer and Moderna vaccine is technologically different, and even they are having scaling issues and delays.
The reason for the late notice is that most likely the issues were in the last steps of the complicated manufacturing process. Hopefully they learned from this and will be able to ramp up production.
Watching the reaction of AZ CEO reaction, I don't see it in that light.
Basically they took enough time to have EU too much compromised to turn around and look for other solutions. And don't buy the narrative that AZ isn't gaining anything from this, they're basically getting funding and facilities to enter the vaccine market.
Maybe approving AZ was a mistake, and should have doubled down on Pfizer and aprove either the Russian or Chinese vaccine.
AZ might not have the best PR but if they are more on geeky side I would expect HN blog to understand them even better. At least to me it seems that they know what they are doing. But I studied pharmacy and I can relate to drug manufacturing in technical details so I might not understand how a lay person sees this.
I think this has been established at this point. The question then become what the EU expected in the case of a domestic production shortfall and what they can do about it. I find it somewhat funny that haven’t bothered to demand doses manufactured in the USA. Perhaps they know better and don’t want to waste their time
Out of the many failures he has, one thing we knew: Trump was pretty transparent.
Also delays for Pfizer were expected because they are expanding their facilities in Belgium, and still, Pfizer is delivering.
AZ will deliver 30 million out of expected 100 million... it's not a little amount, and came out of nothing 2 months before delivery.
The EU is now coming late to a EU first supply policy, but still doesn't have the manufacturing capacity.
The EU is just naive with all the "let's do this together", e "lead by moral example", when in reality they should have placed precisely the first supply policy and everyone would be waiting for Pfizer vaccines until now.
It's sad, but it's the world we live in.
Yet some countries are accelerating these vaccines, while EU is slowing down?
Something isn't adding up, that's all.
It is also worth noting that the rest of the world outside europe is conveniently forgotten when people make a moral argument for a need based division of vaccine between UK and EU.
Ah on this side I think that EU has not imposed any "supply first" clause or executive order to limit supply only to EU until all EU orders are met - which UK and USA did, all production in USA and UK are for internal use until their orders are met.
Basically EU is supplying countries that aren't supplying any country any time soon.
The problem is the manufacturing process. The vaccine is slowly grown in large volume bioreactors. If you need long time from investment till finished product, then obviously people who invested sooner can expect that they receive the product before those who invested only now.
What happened is that both the first UK and the first EU batch had a low yield. The problems were (hopefully) fixed but it will be months before the next batch will be ready.
If the EU had invested sooner, these problems might have been already fixed by now. The UK risked more with earlier investment, so they should get some payout from the risk.
From the moral side I think that it would be fair for the UK to send some vaccine supplies to the EU to show solidarity. Maybe they will do if we talk about this more dispassionately. On the other hand, legal threats are not going to work and may only spoil relationships.
What has "fair" to do with an agreement/contract?
If I make an agreement to delivery 100 million vaccine doses tomorrow and then fail to do it, so what?
Concentrate on real issues, on what we can or cannot do, not on some lawyers' fantasies.
edit: I find the downvotes without explanation a bit depressing. I'm replying to a post containing this:
> Concentrate on real issues, on what we can or cannot do, not on some lawyers' fantasies.
Decreasing UK and Euro deliveries equally is clearly something that we can do and not some legal fantasy.
It is technically feasible and contractually feasible, just not under the current agreements. The problem is that updating the agreements would be a 3 way negotiation with the UK who has all the leverage. Due to current political divide between EU and UK, the EU doesn't want to enter this negotiation, not that I think it would easy. It would probably be political suicide for the UK government to publically reduce domestic vaccine delivery unless EU offered some incredible incentives.
The EU knows this and is instead paining AZ as the bad guy.
>at least if agree with the argument that AZ can't just put their UK production outside the EU calculations
I'm not sure what you meant by calculations, but took my best guess above.
Another factor is that the EU doesn't want to anger the UK by forcing AZ to break UK contract now, because in the long run, they want exports of UK production.
> The hangups seems to be if "Best Reasonable Effort" means includes invalidating contracts with other countries.
Honestly I don't understand how it possibly couldn't. At least not unless EU negotiators screwed up the contract. Otherwise AZ could simply just over-promise and then leave the EU high and dry. I mean that's basically what the EU is arguing is happening here. Of course the contract might not have been worded that way (e.g. in the case where it was determined that AZ were meeting its obligations), but I'm sure if this came up at any time during contract negotiations, then I'm sure the EU would have said that of course other contracts can't be given precedence over theirs. Also given that the contract seemed to treat the UK production as part of the EU for this very reason, it really really seems the EU would have meant for this interpretation.
I mean, it is a pretty clear omission in the agreement given that this was probably the #1 question from the EU going in. These agreements are specifically structured so that there is no down side for underperforming on delivery, because it is a high risk activity and no company would agree to harsh penalties.
The agreement is very clear about what happens if the EU commission enters contracts that limit capacity but silent on AZ agreements. Section 6.2 Capacity limitations:
>In the event AZ's ability to fulfil obligations under this agreement is impeded by a competing agreement entered into by or or on behalf of the commision, AZ shall promptly inform the commission. While AZ shall continue to use Best Reasonable Efforts to engage with its own CMOs and supplies to utilize the capacity and/or components, the commision will assist in finding a mutually acceptable solution for the agreement and the competing agreement. To the extent AstraZeneca's performance under this agreement is impeded by any such competing agreements, AstraZeneca shall not be deemed in breach of this agreement as a result if any such delay due to the aforementioned competing agreement(s)
Similarly, "Best Reasonable Effort" is clearly defined in Section 1.9 as industry standard for vaccine delivery:
(1) in the case of AZ, the activity as and degree of effort that a company of similar size with a similarly sized infrastructure and similar resources as AZ would undertake or use in the development and manufacture of a Vaccine at the relevant stage of development or commercialization having regard to the urgent need for a Vaccine to end the global pandemic...
This is really more about dedicating the appropriate resources to the task opposed to allocation. IF someone wanted to stretch it to make it about contract priority, I don't think voiding contracts and shipping supply based on population is industry standard.
[1] https://ec.europa.eu/commission/presscorner/detail/en/ip_21_...
The EU just refers to the contract and that, if the current production shortage negatively impacts the EU deliveries disproportionately, there will be consequences. As per the contacts, apparently.
Nothing interesting to see here, just typical Sunday reporting. Have to find something to put in the paper.