Company denies claim

Government cancels Valneva’s £1.3bn Covid contract

The company denies claim that it is in breach of contract

Drugs developer Valneva has been told a deal to supply Covid vaccines has been terminated by the UK government which claims the company is in breach of contract.

The French company signed a £1.3 billion deal last September to produce 190 million doses of its experimental drug over five years at its facility in Livingston.

The company said in a statement today that it has received a termination notice from the UK Government in relation to the Supply Agreement for its COVID-19 vaccine candidate, VLA2001. The contract provides HMG with the right to terminate.

HMG has alleged that the company is in breach of its obligations under the supply agreement. The company said it strenuously denies the claim.

Valneva is continuing its VLA2001 development plan. Testing for its pivotal Phase 3 trial, Cov-Compare, is ongoing at Public Health England.

The company recently announced that its Phase 3 results are expected to be available early in the fourth quarter and that these results will form part of its rolling submission for conditional approval of VLA2001 with the UK’s Medicines and Healthcare products Regulatory Agency.

Subject to these data and MHRA approval, Valneva believes that initial approval for VLA2001 could be granted in late 2021.

“Valneva has worked tirelessly, and to its best efforts, on the collaboration with HMG including investing significant resources and effort to respond to HMG’s requests for variant-derived vaccines,” it said.

“Valneva continues to be committed to the development of VLA2001 and will increase its efforts with other potential customers to ensure that its inactivated vaccine can be used in the fight against the pandemic.”

Campaigners have responded to news that the UK is cancelling its vaccine contract with Valneva by saying the failed deal represented a huge missed opportunity to help overcome the Covid-19 pandemic.

Global Justice Now has been advocating for more public research and manufacturing capacity, which could allow countries around the world to bypass corporate monopolies on new drugs.

They say that the patents which apply to Covid-19 vaccines and treatments have severely restricted supply, allowing rich nations to buy up the bulk of vaccines on the market while factories elsewhere lie idle, unable to produce the desperately needed doses. 

The group is calling for countries to agree to override patents and allow more production, and to increase public manufacturing around the world. They claim the investment in Valneva could have been used to support such public manufacturing.

The secrecy around vaccine contracts, which have been a constant source of controversy throughout the pandemic, means it is nearly impossible for politicians and the media to hold the government to account for its use of public funds, the group says.

Liz Murray, head of Scottish campaigns at Global Justice Now, said: “This raises serious questions about the use of large amounts of public money to fund private pharmaceutical companies.

“A year ago the UK government dug deep into its coffers to promise Valneva €1.4 billion reportedly to upgrade its manufacturing facilities here in Scotland, as well as funding some of the R&D for its vaccine and pre-ordering many doses of the vaccine itself.

“Given what now seems to have happened, with the UK government cancelling the contract, wouldn’t a better use of that huge sum of public money have been to fund a publicly researched and manufactured vaccine?

“The current big pharma model keeps vaccine technology locked away behind patents and intellectual property rules, seriously undermining the supply of vaccines to the global south. A publicly funded vaccine could have avoided all of these problems, but the government has instead thrown its money down a Valneva-shaped hole. It’s a huge missed opportunity to vaccinate the world.”

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