Thursday

16th Jul 2020

Coronavirus

EU wants to pay in advance for promising vaccines

  • In an effort to find a successful vaccine fast, companies are building up production and trying promising drugs at the same time (Photo: Hospital Clínic)

The EU Commission wants member states' support to pay some of the costs upfront for companies working on potential Covid-19 vaccines and secure doses for European citizens.

Under its "vaccine strategy" to be presented next Wednesday (17 June), the EU executive plans to sign contracts with pharmaceutical companies working on possible vaccines on behalf of the 27 member states.

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EU health ministers will discuss the plans with the commission when they meet on Friday (12 June).

The commission argued it makes more sense for EU countries to negotiate together rather than in parallel and possibly in competition with one another with firms to secure a vaccine and supply for citizens.

The commission and EU countries' experts would negotiate with companies and agree in an advance payment that firms could use to upgrade their production facilities and look for raw material, even as trials for potential vaccines are still ongoing.

In preliminary talks, companies have told the commission they need public authorities to help "derisk the investment" in potential vaccines.

In order to secure a successful vaccine fast, companies need to build capacities at the same time as they put potential vaccines through trials that eventually might or might not be successful.

The EU would help with those costs, and take that risk, in exchange for commitment from these companies to provide the vaccine to the EU when it is successful and ready.

"We provide funding, they invest, prepare the vaccine, and if successful, they give it to us, with the risk that some of of the potential vaccines we invest in won't work," a commission official said.

Ultimately, the member states would be buying the vaccines and governments would decide on who gets access to the drug first, with most likely health care and frontline workers getting vaccinated first.

The commission aims at signing contracts with several companies to hedge bets. For now it has set aside €2.7bn from the EU budget for advanced payments.

'Contract, not subsidy'

"We are not talking here about subsidies to companies, we are talking about contracting for the vaccine, reflecting the cost of producing it," the commission official said.

The executive will be looking at companies that have the potential to develop the drug fast, whose vaccine has already entered the clinical trials phase or is very close to that.

The commission is also looking for companies that have a very strong production capacity in Europe. "We look at production facility, not the nationality of company," the commission official added.

The official said the EU needs to secure around 300-600 million doses of the vaccine depending on how many doses are needed per person for immunisation.

The EU executive also proposes temporarily lifting the requirement to have an environmental risk assessment on possible GMOs used to develop the vaccine, because it would delay the process. But the member states and the EU parliament need to agree to this move.

Recently, an "alliance" between Germany, France, Italy and the Netherlands was also forged to fund and secure vaccine for Europeans.

The commission official said they are not competing with the alliance and, within a matter of days, they will work out how to combine their efforts.

Once member states agree to task the commission with negotiating with companies, the EU countries could not negotiate themselves with the same companies, but could contract firms that have not signed agreements with the EU executive.

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The European Commission launches on Monday an initiative to raise €7.5bn to speed up the development of vaccines, treatment and testing capacity, ensuring that is equally "available to everyone and at affordable prices" and avoiding nationalisms.

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The public health crisis caused by the coronavirus in member states has pushed the European Commission to play a more active in the field of health, especially funding the development of an effective Covid-19 vaccine.

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