EU seeks huge fine in court over AstraZeneca vaccine delivery delays

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By Euronews with AP
Lawyer for AstraZeneca Clemence Van Muylder arrives for a hearing, European Commission vs AstraZeneca, at the main courthouse in Brussels, Wednesday, May 26, 2021
Lawyer for AstraZeneca Clemence Van Muylder arrives for a hearing, European Commission vs AstraZeneca, at the main courthouse in Brussels, Wednesday, May 26, 2021   -   Copyright  Virginia Mayo/AP

After months of a bitter dispute over vaccine delivery delays between the European Union and AstraZeneca, a highly publicised trial opened on Wednesday in Brussels.

On this first day, the EU accused the drugmaker of acting in bad faith by providing shots to other nations when it had promised them for urgent delivery to the bloc's 27 member states.

Brussels asked the court to fine AstraZeneca €10 million per infraction and to force the company to pay €10 per dose for each day of delay as compensation for breaching the EU contract, while seeking a court order for the urgent delivery of promised jabs.

300 million AstraZeneca jabs were expected by the end of June. But only a third of that will be delivered to Member states.

EU lawyer Rafael Jafferali told the court the company now expects to deliver the total number of doses by the end of December. "With a six-month delay, it's obviously a failure," he said.

'Best reasonable effort'

His main argument is that AstraZeneca should have used production sites in the bloc and the UK for EU supplies as part of a "best reasonable effort'' clause in the contract. He said that 50 million doses that should have been delivered to the EU went to countries outside the bloc instead, "in violation'' of their contract.

The EU legal team also accused the drugmaker of granting preferential treatment to the UK instead of delivering jabs to the EU.

Charles-Edouard Lambert, another lawyer on the EU team, said AstraZeneca decided to reserve production at its Oxford site for Britain. "This is utterly serious. AstraZeneca did not use all the means at its disposal. There is a double standard in the way it treats the UK and member states," he said.

Jafferali has said the company should use all four plants listed in their contract for deliveries to the EU. As part of an advanced purchase agreement with vaccine companies, the EU said it invested €2.7 billion, including €336 million, to finance the production of AstraZeneca's serum at the four factories.

He also accused the company of misleading the European Commission by providing data lacking clarity on the delivery delays.

'Groundless accusations'

While the bloc insists AstraZeneca has breached its contractual obligations, the company says it has fully complied with the agreement, arguing that vaccines are difficult to manufacture and it made its best effort to deliver on time.

A lawyer representing AstraZeneca, Hakim Boularbah, said the company's May 2020 agreement with the UK government and Oxford University, the vaccine's co-developer, clearly gave priority to Britain. "It's very shocking to be accused of fraud,'' Boularbah said, calling it "a groundless accusation."

The company's claim that other contractual obligations slowed down the process is one of the legal difficulties in this trial, according to Geerts Van Calster, an EU law professor at KU Leuven University.

"The possibility or not for AstraZeneca to deliver these vaccines depends, of course, on the contractual commitments that they also have with other parties," the legal expert told Euronews.

"And that is a difficult element in this particular procedure because it would probably oblige the judge to look at the content of these other contracts as well. And in fact, the judge, of course, may or may not have access to these contracts," he added.

Following Wednesday's hearing, a second one is slated for Friday. A decision is expected within two to four weeks and can be appealed afterwards.

A long-standing dispute

Amid a deadly surge of coronavirus infections in Europe earlier this year, delays in vaccine production and deliveries hampered the EU's vaccination campaign.

Cheaper and easier to use than rival shots from Pfizer-BioNTech, the AstraZeneca vaccine was a pillar of the EU's vaccine rollout. But the EU's partnership with the firm quickly deteriorated amid accusations it favoured its relationship with British authorities.

While the UK made quick progress in its vaccination campaign thanks to the AstraZeneca shots, the EU faced criticism for its slow start.

Concerns over the pace of the rollout across the EU grew after AstraZeneca said it couldn't supply EU members with as many doses as originally anticipated because of production capacity limits.

Improving indicators in Europe

The health situation has dramatically improved in Europe in recent weeks, with the number of COVID-19 hospitalisations and deaths on a sharp downward trend as vaccination has picked up.

About 300 million doses of vaccine have been delivered in Europe -- a region with around 450 million inhabitants, with about 245 million already administered.

About 46% of the EU population has had at least one dose.

In total, the European Commission has secured more than 2.5 billion vaccine doses with various manufacturers.

It recently sealed another major order with Pfizer and BioNTech through 2023 for an additional 1.8 billion doses of their COVID-19 shot to share between the bloc's countries.