EU nations eye care agreement shattered as demand for Covid vaccine wanes

(Bloomberg) — A year after struggling to find adequate stocks of Covid-19 vaccine, a number of European countries are overflowing with vaccines they can’t use — and they’re telling drug companies they don’t want to pay more.

Health officials from European Union members including Poland, Slovakia, Romania, Bulgaria, Luxembourg, Finland, the Netherlands and the three Baltic states met on Wednesday to discuss contract changes with manufacturers like Pfizer Inc. as supplies overflow and shot storage costs increase with short shelf life.

The virtual meeting, organized by Polish Health Minister Adam Niedzielski, follows appeals by some individual EU members in recent weeks to the European Commission, the bloc’s executive branch.

Some countries are trying to change so-called pre-purchase agreements they have signed with producers as demand for shots slacks and budgets are squeezed by the aftermath of the war in Ukraine and the cost of housing refugees.

Adjusting agreements with suppliers could give member states the right to “postpone, suspend or cancel short-shelf life vaccine supplies altogether,” the prime ministers of Estonia, Latvia and Lithuania wrote in a joint letter to Commission President Ursula von der Leyen late last month .

In a separate letter, the Ministry of Health of Bulgaria, which has the lowest vaccination coverage in the EU, said there needs to be an “open dialogue” with the Commission and pharmaceutical companies about the delivery of vaccines.

role of the commission

The commission has spearheaded the delivery of vaccines to the bloc and other European countries, leading to deals with Pfizer and BioNTech SE, as well as Moderna Inc., which secured billions of shots at the height of the pandemic. But many nations, including some with low vaccination rates, are now scrambling to cut costs as demand for vaccines falls.

Romania, one of the EU’s least vaccinated countries, has sold doses to Germany and Hungary amid oversupply and shortages in storage. Hungary, meanwhile, recently suspended a round of joint purchases to reduce its own oversupply.

Poland triggered a “force majeure” clause last month after failing to renegotiate a deal with suppliers, refusing to accept new shipments or paying for additional cans.

The Commission announced on May 13 that it had reached an agreement with BioNTech and Pfizer to adjust delivery schedules for Member States. Cans originally scheduled for June and throughout the summer will now be shipped in September and autumn and winter, the commission said, without providing a copy of the agreement.

Pfizer and BioNTech have both said they are working with the commission to address the needs created by the evolving pandemic. The companies cannot comment on potential or ongoing discussions, BioNTech said Friday.

The push to change treaty terms shows how the 27-nation bloc has entered a new phase in its fight against the virus. While demand is falling just a year after countries struggled to access supplies, many EU members are still a long way from the 70% vaccination target.

Covax, the global vaccine initiative backed by the World Health Organization, has said it has enough doses for countries to meet their vaccination targets, but shipments are slowing as the focus shifts from pumping out supplies to overcoming distribution hurdles, hesitations and other factors shifted has hampered rollouts.

The data company Airfinity Ltd. recently lowered its estimate of global vaccine revenue for 2022 to about $64 billion from $81 billion.

©2022 Bloomberg LP

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