LONDON – EU health ministers have given the go-ahead for the European Commission to negotiate COVID-19 vaccines contracts on behalf of all 27 member states, approving the use of a €2.3 billion (US$2.6 billion) emergency fund for down payments.

The commission will now issue an open call to all vaccines producers with manufacturing capacity in Europe and which have COVID-19 vaccines that are, or will be in clinical trials in 2020.

“Working with the member states on the basis of clear criteria, we will select which companies to enter into negotiations with,” said Stella Kyriakides, EU health commissioner. “I am pleased that from today’s council meeting we have received a clear political mandate to progress with the strategy,” she said, speaking after agreeing on the proposal with ministers on June 12.

The advance purchase agreements will involve the EU paying up front in exchange for a commitment on access if a vaccine is approved.

An EU official said there is a large up-front risk for manufacturers, which need to invest in raw materials and production capacity in advance of knowing whether a vaccine will be safe and effective. “Companies say they are willing to help and want to invest, but they can’t take all the risk,” she said.

The EU will lose money if a particular vaccine fails in development. “But if it is successful, all the money goes into production of the vaccine,” said the official. The agreed payments won’t all be up front and the EU won’t be liable for milestones on products that fall by the wayside.

Along with advance payments, the EU is promising “regulatory facilitation” on the part of the EMA, to speed vaccines through the approvals process. In addition, the requirement for environmental assessments of vaccines that use genetically modified delivery constructs, such as adenoviral vectors, will be waived.

Companies are being promised the EU will be “swift” to sign contracts and that they will have one single point of contact and a single negotiation for agreements covering the EU27. The commission intends to increase the chances of success by sealing up to six advance purchase agreements for products based on a variety of technologies.

The amount paid in advance will vary according to what it will cost to manufacture each product, but the EU expects vaccines to be supplied at cost, and a number of companies have given that undertaking. The agreements will give each member state the right to buy a certain number of doses relative to the size of their populations, for a certain price.

“Working together, we will have the benefit of scale, bringing the demand of over 500 million citizens and the leverage of the EU budget,” said Kyriakides. “Doing this together will be faster, easier and cheaper for us all.”

Kyriakides said the EC has been in discussions with vaccine manufacturers for several weeks about the scheme, but would not comment on whether the combined purchasing initiative is a direct response to concerns there will be a block on exports of COVID-19 vaccines produced in the U.S. Companies headquartered in the U.S. will be eligible to bid for the EU contracts, but only if they have manufacturing facilities in Europe.

Last week, four EU members – France, Italy, Germany and the Netherlands – announced the formation of a vaccines alliance, saying they are in joint discussions with pharmaceutical companies to accelerate production of a COVID-19 vaccine “on European soil.”

“We are working very closely with [the alliance],” Kyriakides said. “We propose to work together to bring in everybody’s expertise. Both tracks should converge for the benefit of the EU27.”

As of June 9, the incidence of COVID-19 infections in Europe is down by 80% compared to the peak on April 9. It is clear the pandemic is not over in the EU, and it is now on the ascent in low- and middle-income countries. A vaccine is the “only real exit strategy,” said Kyriakides. “And it has to be available across and around the world.”

In May, the European Commission hosted a global pledging event which raised €9.3 billion from donors worldwide, to support universal access to COVID-19 vaccines. One of the criteria to be applied in selecting which companies are awarded EU advance purchase agreements will be a commitment to supply low- and middle-income countries, too.

“This [advance purchase agreement] initiative will be closely coordinated with the massive effort we are making on the global access to vaccines,” said Kyriakides.

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