European Commission launches legal action against AstraZeneca

Following weeks of speculation in media reports, the European Commission has launched legal action against British-Swedish pharmaceuticals company AstraZeneca for not upholding its supply contract for Covid-19 vaccines and for not having a "reliable" plan to ensure punctual deliveries.

Under the contract, AstraZeneca had committed to making its "best reasonable efforts" to deliver 180 million doses to the EU in Q2 2021, coming to a total of 300 million between December 2020 and June 2021.

However, on March 12, the company released a statement saying that it would only deliver one-third of that amount by the end of June, with 70 million of that being in Q2. The following week, the Commission sent a legal letter to AstraZeneca as the first step in formal proceedings to resolve disputes.

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The delays with AstraZeneca have contributed towards hindering the EU's vaccination programme. The vaccine, which the company developed with Oxford University, was initially intended to the main one in the bloc's rollout for the first half of this year. However, repeated supply cuts have led the EU to change its plans and it relies heavily on the Pfizer-BioNTech jab.

"The Commission has started last Friday a legal action against AstraZeneca," the EU spokesperson told a news conference, adding that all 27 EU states backed the move.

Explaining what triggered the bloc's move, the spokesperson said: "Some terms of the contract have not been respected and the company has not been in a position to come up with a reliable strategy to ensure timely delivery of doses."

AstraZeneca has described the EU move as being "without merit" and has said it will defend itself in court.

"AstraZeneca has fully complied with the Advance Purchase Agreement with the European Commission and will strongly defend itself in court. We believe any litigation is without merit and we welcome this opportunity to resolve this dispute as soon as possible," the company said in a statement.

The contract stipulates that the case will need to be resolved by the courts in Belgium. 

"We want to make sure there is a speedy delivery of a sufficient number of doses that European citizens are entitled to and which have been promised on the basis of the contract," the spokesperson said.

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The purpose of the legal action, EU officials have confirmed, is to secure more vaccine supplies than the revised amounts the company has said it will deliver.

The legal action comes after months of disputes between the European Commission and AstraZeneca amid concerns over the vaccine's efficacy and safety, as well as supply issues.

While the jab has been linked to very rare cases of blood clots, the European Medicines Agency has recommended its use continue in order to stem the spread of Covid-19, a third wave of which is currently enveloping many countries on the continent.

"We had to send a message to [Pascal] Soriot," said one EU official, referring to AstraZeneca's CEO.

Some EU member states, most notably France, Germany and Hungary, were initially reticent about following a legal course of action, largely on the grounds that doing so would not speed up deliveries. However, they eventually gave their backing to the move.

Following the Commission's official announcement of legal action, AstraZeneca said that it was still in the process of ensuring the delivery of almost 50 million doses by the end of April. This amount is in line with the company's revised target of 100 million shots by the end of this quarter.

The EU wants the 300 million doses that AstraZeneca originally promised though, in a sign of its waning patience with the company, it has opted not to buy a further 100 million shots - an option contained in the contract signed in August 2020.

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The AstraZeneca dispute has poured oil on the flames of ongoing disagreements with ex-member state, the United Kingdom. AstraZeneca said it had been prevented from exporting from its UK factories, according to EU officials. 

The bloc is now opposing exports of the AstraZeneca shot from a factory in the Netherlands to Great Britain.

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