I've written before that the EU has sado-masochistic tendencies, deliberately harming its population, for example through excessive austerity caused by its failure to establish the euro properly*. Amongst other things this has condemned much of southern Europe to monumental levels of unemployment amongst young people. To add to its existing structural and psychological problems, the EU has become paranoid about the UK. And now we aren't just seeing psychological traits, we are seeing physical manifestations of them. Under pressure from the German press (particularly Die Zeit, a heavyweight not a tabloid) saying that the vaccines fiasco is "the best advert for Brexit....and if something goes wrong, it's everyone else's fault" the EU exhibited psychogenic movement disorders. What are they? Involuntary spasms caused by stress and psychological conditions. It seems the only explanation for the bizarre behaviour we observed.
It was all reminiscent of the excellent 1991 Alan Bleasdale drama series on Channel 4, GBH, in which Robert Lindsay played a hard left council leader who becomes paranoid and unstable, developing an expanding repertoire of involuntary tics and spasms which become increasingly difficult to conceal.
The EU's twitch on the Irish border was spectacularly ill judged - could it really have thought there was an imminent risk of vaccines intended for EU countries going to mainland Britain via the Republic and Northern Ireland? But the funniest twitch probably belonged to Stella Kyriakides, European Commissioner for health and food safety, who said “We reject the logic of first come, first served." (She was actually quoted as saying "first come, first serve" but that would be gibberish....) She continued "That may work in a butcher’s shop but not in contracts and not in our advanced purchase agreements.” Well, the concept of queueing and waiting your turn is so peculiarly British, isn't it? Still, if I'm ever in a queue when the goods are running out, I can't wait to use the argument that I reject the pathetic "first come first served" concept, especially if people in front of me have be so daft as to bother pre-order. Come to think of it the butcher's shop next Christmas could be a perfect opportunity. In the EU's world you don't need to plan in advance, just barge to the front and exert your "rights", even if you aren't right.
The EU was driven to blind fury when Astrazeneca (abbreviated to AZ from here) owned up that there were production "glitches" in their Belgian and Dutch plants. I've been there before when customers try to "hold the contractor's feet to the fire" and insist that you "must" deliver when there is a technical problem you are doing your damndest to overcome. The EU rejected that it was a "best reasonable efforts" contract and then published a lightly redacted version which showed that was exactly what it was. Yes, sadly, of course I've downloaded and studied the 42 pages.
Having seen many quite similar contracts, some of them with the EU (or EEC as it was then) I realise that you can't necessarily take clauses out of context. But the phrase "best reasonable efforts" is mentioned only a few times. Importantly in the preamble of "Whereas" statements it is noted that AZ has partnered with Oxford University to rapidly clinically evaluate and scale-up global manufacturing of the vaccine. Subsequently it says as part of that scale-up, AZ "has committed to use its Best Reasonable Efforts to build capacity to manufacture 300 million doses of the vaccine... for distribution within the EU" going on to reserve an option for the Commission to purchase a further 100 million doses. The implication of that wording to me is that AZ were committing to build capacity specifically for the EU to draw on for their initial order. I'm not surprised this isn't totally explicit as neither party would want the EU to end up owning the plants, but it does matter for what comes later.
Subsequently, in clause 5.1, the contract says "AZ shall use its Best reasonable Efforts to manufacture the Initial Europe Doses within the EU for distribution...." going on to state how many doses AZ would try to deliver in 2020 and in Q1 of 2021, these details being redacted.
I was often cautioned not to agree to offer "best endeavours" in a contract, as traditionally this is taken in British law to mean that you must do everything you possibly can, leaving no stone unturned and without any test for reasonableness or the other problems it might cause you**. Commercial managers were always more comfortable with "reasonable endeavours". So I was wondering exactly what "best reasonable efforts" means. Especially under the law of Belgium. But of course the contract defines it in the section on definition of terms. In this case "Best reasonable Efforts" means:
"..the activities and degree of effort that a company of a similar size and with similar-sized infrastructure and similar resources to Astrazeneca would undertake or use in the development and manufacture of a Vaccine at the relevant stage of development or commercialization having regard to the urgent need for a Vaccine to end a global pandemic which is resulting in serious public health issues, restrictions on personal freedoms and economic impact across the world, but taking into account efficacy and safety..."
So all AZ need to do is what any similar company would have done. It is unfortunate that the plants in the EU don't appear to have worked at full capacity instantly but, for these type of plants and processes it's not exactly a surprise when they don't and unforeseen glitches have to be resolved. (The AZ process involves growing host cells in a series of bioreactors which are then infected by a virus seed). That's a long way from suggesting that AZ haven't used "best reasonable efforts". Which is why the EU tried to say it wasn't a best efforts contract, AZ had a contractual commitment to deliver. Which gets you nowhere if the plants still need de-glitching, a process I spent much of the first three years of my career as a newly qualified chemical engineer doing.
So it is entirely relevant that the EU placed its order 3 months later than the UK did. And it is also why the EU sought to argue that AZ should divert product from AZ's UK plants.
In clause 5.4, Manufacturing Sites, the contract says AZ will use its Best Reasonable Efforts to manufacture the Vaccine at "manufacturing sites within the EU (which, for the purposes of this section 5.4 only shall include the United Kingdom)" which would appear to muddy the waters at least a little. Is that relevant though? It is presumably why the EU thought it could grab some of the UK production. Whether the UK plant has capacity to fulfill AZ's obligations to the UK and EU in parallel right now we can only wonder about, but it seems likely from the exhibited behaviours that the answer to that is "no".
The clause goes on to say that AZ can use sites outside the EU (and UK) but only if it tells the Commission and explains why it needs to do so. It then goes on to say that if AZ cannot manufacture the initial doses for the EU within the EU, the Commission may present to AZ Contract Manufacturing Organisations (CMOs) within the EU capable of manufacturing the doses and AZ will use Best Reasonable Efforts to get into contract with said CMOs. So why didn't they do that? Presumably because that capability isn't just sitting there to be switched on at a moment's notice. And would need quite a bit of tweaking to adapt to the specific AZ process.
I expect much of the available capacity is already engaged in the complex supply chains the various manufacturers have established. For example, I read that the raw materials for the Pfizer/BioNTech vaccine are made in Mainz, Germany. Rentschler, a German contract manufacturer, then performs the purification steps before the stuff is sent to Pfizer's site at Purrs in Belgium where it is thawed and formulated and filled into vials. And then presumably refrozen to -80C. Moderna is reliant on at least three other companies for elements of its process. AZ has built more than a dozen regional supply chains to meet anticipated demand, all before the vaccine was approved anywhere. In total AZ is working with more than 20 supply partners in more than 15 countries.***
The full implications of clause 5.4 are not entirely clear to me. But the fact that the EU anticipated that AZ might not be able to deliver to its obligations weakens their already flimsy case.
At the time the BBC said AZ's UK plants were described as "primary" and mainland European plants "secondary". I'm not sure who told them that as there is no such terminology that I can see in the contract.
It is no great surprise that a contract to develop a brand new vaccine, test it, secure regulatory approvals and scale up the manufacturing process for something never made outside a lab before should be caveated by "best reasonable efforts". I've been associated with many contracts where the supplier (i.e. the company I worked for) wanted to convince the prospective customer that they could do the task without wanting to commit that they absolutely would do it because of technical uncertainties. The EU-AZ contract has no penalties in the form of liquidated damages for failure to deliver on time. Indeed, it anticipates that AZ might fail to successfully develop the vaccine or be able to obtain regulatory approvals and spells out what costs AZ could claim if it decided to abandon the project. It is extremely hard to see how Ms Kyriakides sees this contract as spelling out a definitive requirement to deliver a certain number of doses by March 2021. It seems likely to me that she hasn't read or understood the contract. Or didn't want to.
Which is why the EU presumably resorted to futile Trumpian tweeting rather than talking sensibly with its supplier. Although, as they cannot have thought this would make any difference whatsoever to the gremlins in the AZ plant, it is likely this was to appear to be doing something and to deflect the attention of the press in their recalcitrant member states like Germany, who are unlikely to trust the EU with such important and urgent ever stuff again.
Futile because, if AZ could supply the doses they said they would try to deliver by March, they surely would. And yet the EU contract with AZ clearly brigades the UK plants with the EU ones. That may have made the EU feel they could insist on vaccines made in UK being diverted. But the UK is not a party to the EU contract. So AZ's contract with the UK cannot take into account any obligations to the EU as there were no such obligations at the time the UK-AZ contract was entered into. In principle AZ could be in the uncomfortable position where it ends up in breach of either one contract or the other. However, as I don't think the EU contract can be read as a binding commitment on AZ to deliver the initial EU doses on time, they probably aren't between that rock and hard place.
Just how the EU thought it could force AZ to allocate a proportion of the UK production to the EU is not clear, though presumably it did not intend to launch the first successful invasion of England since 1066, unless you count William of Orange in 1688 as an invasion (some do). Maybe the French were planning to reprise their failed attempt at the Battle of Fishguard in 1797, which would at least have been entertaining.
However, I do think there was a real threat to UK supplies of not just the Pfizer but also the Astrazeneca vaccines in the EU's planned export ban. Apparently the capacity of the Wockhardt**** plant at Wrexham is nowhere near enough to package the bulk manufactured vaccine into vials so bulk quantities of the AZ vaccine are exported to Germany, which has a large glassware industry, for finishing, packaging into vials and re-exporting to the UK. It's not clear that the EU understood this when it had its hissy fit and mooted the export ban, but one can imagine the hoo-ha if the EU had blocked the re-export of these vaccines, something they appear to have backed off from.
The fact that the EU has gone quiet on AZ's obligations and has stopped talking about export bans, which evoked pretty universal condemnation, pretty well proves that the EU had no case whatsoever. Whether or not Brexit has damaged the UK's standing in the world, these events will have harmed the EU's reputation just as much. Nevertheless, all of this shows just how wise the UK was to go its own way on vaccines. Don't forget Labour and the LibDems would have gone into the EU's bureaucratic scheme. Last summer Catherine West, Labour's shadow Europe minister, labelled our decision not to participate in the EU's vaccine scheme as "dumb and dumber" while her colleague Bell Ribeiro-Addy accused the government of "putting ideology before lives". The LibDems Layla Moran said the Tories were favouring Brexit over vaccines and wrote to Matt Hancock urging him to join in with the EU and put "lives ahead of ideology" (I think you'll find that last point is exactly what they did, Layla). The party's health spokesperson Munira Wilson said the Tories "stubborn unwillingness to work with the EU was unforgivable".
In practice, the UK might arguably have got lucky in so far as the first three vaccines to come through (I'm excluding vaccines from China and Russia here) were all on our pools coupon. But the way that coupon was put together, spreading the bets with a variety of vaccine types, companies and production locations showed good judgements were made. And rapidly too. The instruction to go out and get supplies and not haggle too much on price and the decision to indemnify the pharma companies from legal action as a result of vaccine problems to enable the roll out to start quickly also look to have been good calls. (Don't worry, the government has added the coronavirus vaccine to the list of vaccinations covered by the Vaccine Damages Payments Act, which pays out a one-off £120,000 payment to people who are permanently disabled or harmed as a result of a listed vaccination).
The UK government's decision to encourage Oxford to team with a UK based pharma company - apparently Oxford were originally considering teaming with the American company Merck - has also proved to be wise. That's a lot of sound decisions that have come together. And while there has been some justified criticism of government by chumocracy, Kate Bingham clearly did a good job in charge of the vaccines task force and unpaid at that.
I've seen a few comments, on social media mainly, decrying "vaccines nationalism". None of them has explained quite what is meant by that phrase. We all accept that the virus won't be properly contained until as much of the world as possible has been covered. I guess in some kind of utopia the available supplies could theoretically be rolled out across the world in priority group order. I suspect that, in addition to that being political suicide for governments in the producing countries, it's not clear any such plan would be the optimal way to proceed as the virus would continue to circulate widely at high levels in all countries for longer and we would only gather information slowly about how best to exit the pandemic era. I think we can set aside such idealism as impractical - and it certainly wasn't what the EU had in mind. The producer countries will look after their own and then help other countries.
And guess what? If the EU had succeeded in diverting any UK production I think we can deduce that it would be supplies intended for any third party countries that signed up with AZ before the EU that would get delayed. So we can see this grand, compassionate, munificent edifice that the remainers were always telling us about for what it really is.
In case you though it was just the Commission, with its recycled failed national politicians who aren't up to the job, like von der Leyen, President Micron joined in the act by pronouncing the AZ vaccine "quasi-effective" for over 65s. Given the high level of anti-vacc sentiment in France this seemed a spectacularly foolish thing to say. Later in the year when they get some sort of act together the French will no doubt be trying to get their citizens to have jabs. Maybe Micron was hoping his people will wait for the Sanofi vaccine, which he can wrap in the French flag. Good luck with that mate, you might need it. (Of course Micron is worried about his own skin, the French election and Marine Le Pen). I don't think this cartoon was aimed specifically at Micron:
The EU's use of Twitter for diplomacy and the preposterous statement by Micron were both quite redolent of Trump. And, perhaps surprisingly, it was in stark contrast to the calm behaviour of the UK, in particular Boris Johnson. I'm not sure would have expected this but, having read Dominic Lawson's column last Sunday it's clear that the government has a strategy of being courteous to the EU, at least in public. Although Katya Alder reported on the BBC that the government had "berated" the EU (it hadn't), Johnson declined invitations from his backbenchers in the Commons to tell the EU "hands off our vaccine" and, according to Lawson's source, the order has gone out from the PM that we are not to compare our vaccine inoculation performance with that of the EU and certainly never to make a point of it. "The line we get from Downing Street is show, don't tell". All this despite the provocations of comments such as the EU justice commissioner, who accused the UK of wanting to start a vaccines "war" and and the Belgian deputy PM saying the UK was "vaccinating people with vaccines that do not have the same standard as the ones we use". On the contrary, when the EU threw its wobbly, Johnson and Gove worked the phones with calls to the Irish PM and foreign minister, Gove spoke to Maros Sefcovik, the Slovak vice-president of the Commission (his opposite number on Brexit implementation in Northern Ireland) before Johnson phoned Von der Leyen and emphasised that, if it undermined contract law, the EU would ruin its credibility. He said the Pfizer vaccines "have to be allowed to leave the EU". According to the Sunday Times the same evening Von der Leyen had spoken to the Irish, called Johnson back with an assurance that the Pfizer vaccine supply to the UK would not be interrupted and tweeted that
"we agreed on the principle that there should not be restrictions on the export of vaccines by companies where they are fulfilling contractual responsibilities"
almost word for word what Johnson had said to her. Nevertheless there was embarrassment at the Commssion's inept performance in Brussels. An official involved in the Brexit negotiations on the EU side said if Von der Leyen had not changed course "I think I would have resigned".
All this led Dominic Lawson to conclude that, at the moment, the separation is too raw for the EU to forgive. The UK has decided to be polite and patient and "wait for them to get over it".
After all that's the best way to deal with the situation when faced with psychogenic movement disorder: stay calm, maintain composure, be polite and helpful. And don't smirk.
* Wolfgang Munchau sees a parallel between the EU's mismanagement of financial union and now vaccines. See Overloading: the EU used to do a few things well, now it does a lot of things badly. Eurointelligence blog, 29 January 2021. https://www.eurointelligence.com/column/overloading. The entire item is worth reading but on this point he says:
"I see a parallel with how the EU ended up mismanaging the monetary union. The eurozone is the shared responsibility of several commissioners, the Ecofin, the eurogroup, the European stability mechanism, 19 governments and various quangos set up around them. It lacks the legal and institutional ingredients of an economic union: a finance minister, tax raising powers and the right to issue debt. Austerity, probably the gravest economic policy error of our time, is what happens when you leave 19 small-to-mid-sized countries on a rules-based fiscal auto-pilot."
** Some experts now say this traditional view was overly burdensome and not actually justified by case law in the UK (and also the US) and should be limited by what is reasonable. They say that "reasonable" efforts (or endeavours) implies taking one course of action, whereas "best" efforts requires all reasonable courses to be taken. So a requirement to undertake "all reasonable efforts" is essentially the same as "best efforts". They don't consider the EU contract phrase "best reasonable efforts" though I would argue that falls short of "all reasonable efforts", you just have to assess what the best options for success are. See https://www.jonesday.com/en/insights/2007/07/best-efforts-and-endeavourscase-analysis-and-practical-guidance-under-us-and-uk-law#:~:text=An%20obligation%20to%20use%20reasonable,the%20reasonable%20courses%20he%20can.
*** This was in an interesting article "Attention turns to vaccine production following successful trials" in The Chemical Engineer, Issue 954/955 December 2020/January 2021. This article predicted that the bottleneck in supply would be in supply chains including packaging into vials, which is likely to become more so when the vaccines are being made in quantities to export around the world. It also quoted a member of the IChemE's Covid-19 Response Team saying he was confident Pfizer, AZ and Moderna would meet their production targets. (He didn't say specifically which production targets, we are still very early in this game).
**** The Wockhardt plant has nothing to do with Germany. Apparently the British-Indian owner called the business this because it sounded like "work hard".
Dominic Lawson's column "Brexit is done. We don't need to bait Brussels" was in the Sunday Times on 31 Jan 2021.
Panicked calls, hasty tweets: how the vaccine crisis unfolded, Sunday Times 31 Jan 2021
You can view and download the redacted EU-Astrazeneca Advance Purchase Agreement at https://ec.europa.eu/commission/presscorner/detail/en/ip_21_302