The EU is betting the future of its citizens and the European economy on vaccines. But what exactly are the terms of that bet, and how much of it will EU taxpayers have to cover? Those are questions that leaders in Brussels decline to answer.
European Commission President Ursula von der Leyen proudly announced on November 24 that the EU had secured a sixth contract for millions of coronavirus vaccines on behalf of its 27 member countries — bringing the total purchased to nearly 2 billion vaccines for the bloc’s roughly 440 million people. As she declared to the European Parliament on the following day: "This is our ticket out of the pandemic."
But what may be the most vital government procurement process in EU history is shrouded in secrecy. EU officials won’t provide information about how much the bloc is paying for the vaccines — many of which benefited from an infusion of public research funds. It's also mum about other terms of the contracts, including potential protections for drugmakers should the vaccines fail to live up to projected efficacy rates.
Given the stakes, parliamentarians, civil society groups, global health advocates and procurement experts are now piling pressure on the Commission to release the contracts — or at least key parts of them — for public review, even if there is no legal requirement to do so.
“This is clearly in the interest of us all, and there's clearly so much money involved, which is taxpayers’ money,” said Anniek de Ruijter, an assistant professor of European law at the University of Amsterdam. "It makes a lot of sense to ask for all of that information, and it is in the interest of people to know about it."
Doing so would put the Commission in a tight spot. In a typical tender process, companies vie for government contracts. With the coronavirus, it’s governments that are competing for access to the same greatly sought vaccines — and there are plenty of players with deep pockets.
Releasing the information in the contracts would not only reveal pharma companies’ secrets, but would risk making the Commission’s procurement process “impossible,” according to Sandra Gallina, director general of the directorate general for health and food safety (DG SANTE) and the Commission's point person on the negotiations with drugmakers, in a recently rejected freedom of information request.
Vaccines Europe, which represents key vaccine players including AstraZeneca and Pfizer, did not respond to a request for comment.
Show me the money
One key question is how much taxpayer money is financing the development of these vaccines
, and what taxpayers are getting in return.
Mark Eccleston-Turner, a law lecturer at Keele University, warned that many governments seemed to be paying the bill for these vaccines
twice. First, countries are underwriting the research and development to offset what drugmakers say are enormous production costs prior to regulatory approval. Then, countries are paying again to buy the finished products once they are proven effective and approved for use.
Governments and organizations like the Coalition for Epidemic Preparedness Innovations (CEPI) and Gavi, the Vaccine
Alliance, have poured millions into these vaccines
. “It's a win-win from a pharmaceutical point of view,” said Eccleston-Turner, noting that the actual amount of money drugmakers have paid “from their own pockets” to R&D has probably been "minimal.”
All the upfront investment “doesn't seem to have translated into a lower price point for the vaccine
,” Eccleston-Turner said.
Just how much the Commission is paying per dose isn't public information. Some vaccine
producers have been more transparent, like AstraZeneca
, which said it will sell its vaccine
at cost (roughly €2 per dose) until the end of the pandemic. The company could declare that to have taken place and begin raising costs as early as July 2021, according to the Financial Times.
Others, like Moderna, have given ballpark figures. The company publicly priced its vaccine
at between $32 and $37 a dose, but then made a deal with the U.S. for about $25 a dose. Reuters reported that the EU secured a vaccine
for less than $25 per dose.
What's clear is that vaccines
based on mRNA technology — as two of the front-runner coronavirus
jabs are — are being priced higher than most of the more conventional jabs, even though they could become easier to manufacture in the long run. Producing mRNA is a quicker and cheaper process than cultivating cells, as is needed for the AstraZeneca vaccine
, for example.
There's no EU rule capping how much manufactures can demand for a vaccine
. The only comment from the Commission, issued by Gallina, is that it'll only sign deals for vaccines
that EU countries can afford.
Without greater transparency, it’s impossible to know how much of the bill pharma companies are left with, or whether they are making a profit or loss. But at some level, vaccine
-makers and their executives are clearly profiting already.
and Moderna announced successful efficacy rates by press release, their share prices soared. Moderna and Pfizer
executives have cashed in as well, selling millions of dollars worth of their companies' stock after the announcements that their vaccines
were successful but before their they sought regulatory approval.
This news has only heightened concerns among MEPs, who have argued since the summer that the Commission should release more information on everything from the price per dose to what indemnity provisions Brussels has agreed to.
In response, Health Commissioner Stella Kyriakides has often said her hands are tied, arguing that the Commission can't release the information without the companies’ permission.
“I fully recognize the importance of transparency in this process,” Kyriakides told the European Parliament in mid-November. “Due to the highly competitive nature of this global market, the Commission is legally not able to disclose information contained in the contracts.”
Kyriakides added she is “confident the process will withstand any future review or audit.” The Commission has sought to placate MEPs by saying it might show them some contract provisions once the agreements are finalized.
In a statement, Pascal Canfin, head of the Parliament’s health committee, called the Commission’s offer a “first step."
"But it does not answer our request," he added. "Transparency needs to be done for all the citizens and not only for some MEPs and under [a] confidentiality agreement."
Deal or no deal
In addition to parliamentary concerns about transparency, some global health advocates say the Commission shouldn’t have made the deals in the first place.
Brussels has been a leader in a global effort to secure vaccines
for low- and middle-income countries, raising billions for various global efforts. The Commission has provisions in its contracts allowing EU countries to sell or donate their vaccines
to other countries. But supply is expected to be extremely limited for months, and critics say the EU is still putting its own citizens first.
“If you read the more specific text, it [always states that] once the EU has fulfilled its own capacity and EU member states have sufficient vaccination,” said Katri Bertram, founder of Partners for Impact, an international development group.
Global access is more of an “afterthought,” Bertram added.
It’s important to know then how much of the initial supply is going to EU member countries, as per the company’s contracts, notes Eccleston-Turner. Whether the EU gets 10, 20 or 50 percent of a company’s initial supply “makes a big difference as to how many vaccines
are left over to be split between developing countries,” he pointed out.
Still, as messy as the process is now, it’s better than the botched procurement effort for H1N1 vaccines
back in 2009, according to de Ruijter. Then, EU countries didn't negotiate as a bloc, giving manufacturers an edge as governments bid against each other. The Commission has changed the law multiple times since then to allow for the joint purchase of vaccines
And EU member countries certainly forced Brussels’ hand at the beginning of the pandemic. The Commission was jolted into action only after powerhouse countries Germany, France, Italy and the Netherlands teamed up to negotiate vaccines
because they were afraid the U.S. would snatch up all the vaccines
The outcry would be much louder among citizens if the EU had no vaccines
"If the EU doesn't buy them, someone else will," Eccleston-Turner said.