BRUSSELS (Reuters) – European governments will pay claims above the agreed limit against AstraZeneca due to side effects from its potential COVID-19 vaccine, on various terms before the agreement with Sanofi, an EU spokesman told Reuters.
These agreements reflect the different strategies of the world’s two leading drug manufacturers to protect themselves, as the debate over the responsibility for vaccines aimed at ending the pandemic is raging.
AstraZeneca AZN.L has secured the European Union̵7;s support for a confidential agreement that reflects the lower price sought by the British drug maker, the official said.
“If a company demands a higher price, we do not set the same conditions,” said an official who participated in the negotiations, but declined to acknowledge because the contracts are confidential.
Unexpected side effects after drug approval are rare, but the rate of administration of the COVID-19 vaccine increases the risk of unforeseen conditions.
An agreement with AstraZeneca, which transfers some of the risks associated with the introduction of the vaccine to taxpayers, was signed in August, and no previous provisions on its liability have been received before.
Under the agreement, AstraZeneca will only pay court costs up to a certain threshold, the official said, declining to explain in detail how to share costs with individual European governments or restrictions.
The financial shield would cover both court costs and potential compensation, which is less frequent, but potentially much greater, if something goes wrong.
In exchange for the higher price paid for the vaccine, the French drug manufacturer Sanofi SASY.PA, which works with GlaxoSmithKline as a partner, has not received any disclaimers.
Representatives of AstraZeneca, Sanofi and the European Commission declined to comment on the specifics of the agreements.
Asked about the relatively low price of AstraZeneca, the spokesman reaffirmed the company’s promise to distribute the vaccine widely and not make a profit from it during a pandemic.
Under the AstraZeneca agreement, EU countries agreed to pay 2.5 euros ($ 2.92) per dose, while Sanofi agreed on a price of about 10 euros, the official said.
Under the only supply agreements signed by Brussels to date, the EU has also made a non-refundable contribution of € 336 million to AstraZeneca to provide 400 million doses, proportionally less than the € 324 million it paid to Sanofi to provide 300 million doses.
The EU spokesman told Reuters that the contract with AstraZeneca included a narrow definition of side effects that could limit the possibility of claiming compensation, although the company remains responsible for its vaccine.
The deal with AstraZeneca was agreed before it stopped late testing of the vaccine candidate this month after a British volunteer developed neurological symptoms. The tests resumed in the United Kingdom, but not in the United States.
EU governments will only share the cost of compensation if unforeseen side effects occur after the AstraZeneca vaccine is approved.
Accountability has been a key stumbling block in negotiations with other vaccine manufacturers against COVID-19, EU officials said, because companies fear they risk higher court costs than usual when vaccines are developed for much longer trials.
A spokesman for the European Commission said pre-purchase agreements “provide for reimbursement to producer member states of certain obligations incurred under specific and strict conditions”, but “the responsibility of companies still remains”.
This means that it is the firm’s duty to defend its shot in the courts.
Drug manufacturers are urging EU regulators to set up a pan-European compensation scheme, while patient organizations are demanding a pan-European fund funded by pharmaceutical companies to compensate for unexpected side effects.
The EU legal regime is one of the least favorable for drug manufacturers in terms of claims for damages, although plaintiffs rarely win because the law requires them to prove a link between the disease and the vaccine that may have caused it.
The United States has granted immunity from liability for regulatory-approved vaccines against COVID-19.
Russia, meanwhile, has said it will bear some of the legal responsibility if something goes wrong with a vaccine developed by Moscow’s Gamaleya Institute.
Report by Francesco Guaracio @fraguarascio; Additional reports by Ludwig Burger in Frankfurt, Matthias Blamont in Paris and Tom Hals in New York; Edited by Josephine Mason and Alexander Smith