Current Affairs EU In or Out

[peteblue]

So you're okay if the vaccines produced in the UK are used to fulfil AZ's contract with the EU27?

Bruce, I would be more than happy to share our vaccines with some of the peoples of Africa. The EU and other major economy countries can look after themselves....

 

[spectateur]

Sums it up nicely I thought, but it won’t convince the one eyed Europhiles ......

Why should it?

 

[peteblue]

Of course, but even the most Euroblind should be able to see the EU have completely messed up and their finger pointing is pretty desperate.

I wouldn’t bet on it.....

 

[Billy Dean]

It's a biological product. It'll be a best efforts kind of deal as they say. But it'll be from that factory; the UK will have a contract dealing with UK facilities.

Similarly, if the UK chain had gone wrong, we'd have no recourse to the EU supply chain due to the contract.

It's two things - the EU being three months late on getting it sorted, allowing less time to iron out issues, and the EU being slow on the rollout overall due to regulation.

There's an international shortage of fill and finish, the vaccine has been developed and approved at warp speed - the very nature of it is subject to the manufacturing of it being done to the best of their ability; hiccups were expected.

Vaccines haven't been diverted from the EU to the UK; some have been made in the EU to fulfil an order for the UK.

So which is it?

 

[Tubey]

It would depend on what is discussed between Sony and Smiths no? If Sony have said to Smiths you'll get your PS5s by X date and sign a contract on that basis, then Smiths might get miffed if Sony come back later and say they can't do it.

Are the EU actually telling AZ to reduce supply to UK, or just that they should use the UK factories to supply them too?

I'm not saying AZ haven't breached the contract - they clearly have to a degree, as they've stated X amount and won't have X amount. I'm saying the reasoning for it is probably sound; a production delay.

The EU are saying AZ aren't doing enough, so they're pressuring them to fulfil the contract. They are in their right to do so. However, if AZ can't, it is what it is. If that has already been factored in the delay, which it will have been, then AZ can't ethically take doses destined to the UK and elsewhere to address an unforeseen problem with the EU supply chain. If it was the other way around, it'd be the same - the UK wouldn't be able to demand doses from the EU supply chain.

Clearly, the issue is with the EU supply chain. The breach of contract is due to the allocation AZ had in mind for that contract going wrong. Again, it is what it is. But the reasoning for the EU supply chain being more affected is fairly obvious - the EU contract was three months later, meaning any issues down the road will affect the EU more harshly than the UK, who agreed a deal earlier. That's just common sense - to take UK supply away to rectify it would punish the UK for the EU signing a contract later.

To appease Bruce, I'm not saying all this is certainly the case, but the balance of probability is massively in favour of it being so, to the point where it's almost ludicrous to think of any other valid explanation. Because AZ have no motive to deliberately breach the contract in favour of a third party; none at all, just as it has no motive to breach a second contract with the UK to somewhat rectify the first.

 

[Jebus_lives]

That's a massive if and just doesn't seem likely.

To take the PS5 analogy - say Sony sells one million to Argos, they then allocate how they'll get that one million to Argos. Three months later, Smyths orders one million. But there's then a production backup.

As a business, you don't take away from the allocation to Argos just to fulfil a later order from Smyths, harming both supply chains. In short, you don't breach one contract to lessen the severity of the breach to another, as it'd be unethical and result in two breached contracts.

It's not about choosing to honour one contract over another, it's about adapting to circumstance. What are AZ meant to do - cut off the UK from all vaccine supplies til the EU has caught up, when it's not the fault of the UK in the slightest?

And again, what motive - at all - does the EU have in deliberately not fulfilling the contract? They have literally none.

I'm not suggesting they are deliberately not fulfilling the contract (you seem to be arguing against a position I'm not taking). I'm suggesting they (AZ) can't meet the contract but have indicated they can and have agreed to make 'best efforts' to do so.

The 'motive' simply seems lack of production capacity; and the EU, quite rightly from a contract enforceability perspective, are asking why UK vaccines are being ring fenced for the UK if they form part of a wider production framework.

They want their contract terms met, in exactly the same way as the UK wants it's contract met - 'who signed first' is largely irrelevant unless it formed part of the agreement (I really doubt it will have).

 

[Tubey]

So which is it?

It's both - I said earlier the UK supply is primarily from the UK factories, but not exclusively. AZ when committing to the dosing would have allocated set amounts from all factories to meet that requirement over a set period of time.

 

[peteblue]

Sorry but that's silly. The UK has ordered 100 million AZ vaccines. It's not like all of those will be delivered before the EU gets any, just because that's the order the contracts were signed.

The U.K. vaccination programme will go as fast as product is delivered. GP’s are ready and waiting....

 

[Tubey]

I'm not suggesting they are deliberately not fulfilling the contract (you seem to be arguing against a position I'm not taking). I'm suggesting they (AZ) can't meet the contract but have indicated they can and have agreed to make 'best efforts' to do so.

The 'motive' simply seems lack of production capacity; and the EU, quite rightly from a contract enforceability perspective, are asking why UK vaccines are being ring fenced for the UK if they form part of a wider production framework.

They want their contract terms met, in exactly the same way as the UK wants it's contract met - 'who signed first' is largely irrelevant unless it formed part of the agreement (I really doubt it will have).

They're ringfenced due to being a completely different contract signed three months earlier.

And of course who signed first is relevant - AZ had a three month jump start in allocating and logistically supplying the UK order. They aren't mind readers, they couldn't prepare the EU order in the same way and they can't now just take away from the UK contract to meet the EU one.

If I'm at a shop and buy the last bag of potatoes, Asda can't stop me on the way out and take it back because they expect someone else who needs it more might want it in a few hours.

 

[Jebus_lives]

It would depend on what is discussed between Sony and Smiths no? If Sony have said to Smiths you'll get your PS5s by X date and sign a contract on that basis, then Smiths might get miffed if Sony come back later and say they can't do it.

Are the EU actually telling AZ to reduce supply to UK, or just that they should use the UK factories to supply them too?

They're ringfenced due to being a completely different contract signed three months earlier.

And of course who signed first is relevant - AZ had a three month jump start in allocating and logistically supplying the UK order. They aren't mind readers, they couldn't prepare the EU order in the same way and they can't now just take away from the UK contract to meet the EU one.

If I'm at a shop and buy the last bag of potatoes, Asda can't stop me on the way out and take it back because they expect someone else who needs it more might want it in a few hours.

Are they? The EU seem to disagree.

 

[Bruce Wayne]

I'm not saying AZ haven't breached the contract - they clearly have to a degree, as they've stated X amount and won't have X amount. I'm saying the reasoning for it is probably sound; a production delay.

The EU are saying AZ aren't doing enough, so they're pressuring them to fulfil the contract. They are in their right to do so. However, if AZ can't, it is what it is. If that has already been factored in the delay, which it will have been, then AZ can't ethically take doses destined to the UK and elsewhere to address an unforeseen problem with the EU supply chain. If it was the other way around, it'd be the same - the UK wouldn't be able to demand doses from the EU supply chain.

Clearly, the issue is with the EU supply chain. The breach of contract is due to the allocation AZ had in mind for that contract going wrong. Again, it is what it is. But the reasoning for the EU supply chain being more affected is fairly obvious - the EU contract was three months later, meaning any issues down the road will affect the EU more harshly than the UK, who agreed a deal earlier. That's just common sense - to take UK supply away to rectify it would punish the UK for the EU signing a contract later.

To appease Bruce, I'm not saying all this is certainly the case, but the balance of probability is massively in favour of it being so, to the point where it's almost ludicrous to think of any other valid explanation. Because AZ have no motive to deliberately breach the contract in favour of a third party; none at all, just as it has no motive to breach a second contract with the UK to somewhat rectify the first.

There you go again. As I said previously, you have absolutely no idea what the actual problem is. I've heard people suggesting that the UK plants had 3 months longer to iron out problems, which would suggest that there is absolutely zero communication or knowledge sharing across the AZ supply chain (which is possible, but none of us know that), or it could be that the Belgian plant has a completely new issue that could not have been foreseen.

Now you might also argue that as soon as AZ started getting significant orders that they might start building up their manufacturing capabilities across Europe and stress testing that to make sure that no issues emerged. But again, we don't know any of the work that was done with the €300 million the Commission gave AZ to ensure that happened (not even where that money was spent to my knowledge?)

 

[Tubey]

Are they? The EU seem to disagree.

Unless the EU and UK signed a contract for exactly the same supplies on a 50/50 basis, they're obviously separate orders.

Think logically - imagine, I dunno, Brazil came to AZ now and ordered one billion doses. They don't then just take the same share of vaccines as and when they're produced, as they ordered last. Naturally, if one country orders first, the production to meet that order is allocated - when a country orders last, they'll join the backlog and will be allocated supplies as and when.

We don't get Moderna vaccines until April I believe, with the US rolling it out now, for the same reason - US ordered August, we ordered November. It's just common sense.

 

[Bruce Wayne]

It's both - I said earlier the UK supply is primarily from the UK factories, but not exclusively. AZ when committing to the dosing would have allocated set amounts from all factories to meet that requirement over a set period of time.

you have absolutely no idea if that's the case.

 

[BigMick]

Incidentally, it makes me pretty uneasy that Israel, for example, have appeared to get as far as they have with their vaccinations in part because they were willing to pay extra for each dose. Obviously there is also a difference in price paid between the UK and EU, and you would hope that isn't influencing which areas get the vaccines and which don't.

From what I understand it's true that Israel paid a slightly higher price in return for a fast and uninterrupted delivery. More important, though, were the 17 conversations between Albert Bourla, Pfizer’s chief executive, Netanyahu, and Yuli Edelstein, the health minister, in which the Israelis promised to build one of the fastest vaccination drives in the world and share data on its impact on the pandemic, so long as supplies were plentiful and uninterrupted The ensuing publicity has been good for Pfizer, while Netanyahu, in the midst of an election campaign, has milked it to the full, touring vaccination centres, meeting the planes at the airport and even framing the syringe he was jabbed with.

 

[tsubaki]

Exactly. But at the same time, the EU shouldn't moan at AZ for fulfilling an earlier contract that has no bearing on their own supply, and demanding that contract be interfered with.

They shouldn’t, and if our contract suffers as a result then we should absolutely go after the company for breach of contract. The same rules apply for the EU though, in terms of their deal with AZ.