South Africa bullied by Big Pharma in COVID-19 vaccines contract negotiations

    More details of how South Africa was strong-armed into paying exorbitant prices for COVID-19 vaccines have emerged. This week the health advocacy organisation, Health Justice Initiative (HJI) released a follow-up analysis of the government’s negotiations with COVID-19 vaccine suppliers.  

    “The South African government struggled to keep people healthy during the COVID-19 pandemic because it was bullied by big pharmaceutical companies demanding three times the prices of vaccines as compared to other countries,” says HJI director, Fatima Hassan. 

    Last year HJI won a legal battle in the North Gauteng High Court in Pretoria. The court ordered the National  Department of Health to release all the COVID-19 procurement contracts and agreements. The government also had to disclose all negotiation records, minutes, correspondence, memoranda with companies that may have eventually signed an agreement, and those companies who didn’t end up signing agreements.  Until this judgement, the public had not been aware of the contents of the agreements or even the contracting parties. 

    Hassan says HJI, with the support of many organisations around the world, has been  trying to get access to South Africa’s COVID-19 vaccine procurement contracts and negotiation reports over the last two and half years. She says these are the documents that the pharmaceutical companies did not want the South African public – or anybody – to see. 

    HJI worked with Public Citizens, a US-based non-profit organisation, to analyse the tranche of documents. Their latest analysis shows that Moderna demanded extreme confidentiality provisions around any discussions of supply. Pfizer completely barred South Africa from disclosing any information discussed during negotiations, including prices. 

    “And it is really clear why they wanted to do that, we now have unprecedented insight into their aims and their tactics which reveal a profit maximising strategy,” Hassan says. 

    Strong-armed negotiations

    Hassan believes that pharmaceutical companies wanted to shield themselves from the responsibility of any problems associated with deliveries or vaccine supplies, putting the burden of even importing vaccines on the South African government. 

    “South Africa government was for the better part of 2020 and 2021 heavily criticised for not engaging with Moderna. We now know from the documents revealed to us that the negotiations with Moderna actually commenced in December 2020. 

    “However, those negotiations and discussions were taking place subject to a confidentiality agreement. In other words Moderna made it basically legally impossible for the South African government to share with the public that it was even in negotiations with them for mRNA vaccines,” she says. 

    Their analysis shows that Moderna was actually the company that took the most aggressive approach to shield any of its vaccine supplies from public accountability. 

    “Moderna demanded an excessive price when compared to other countries. It also insisted on the right to override contractual arbitration proceedings. I think this explains why South Africa did not, in the end, receive a single supply of a vaccine from Moderna,” Hassan says. 

    Jishan Ravinthiran, a researcher at Public Citizen adds that South African officials tried to secure more agreements but could not overcome the concentrated private power of the pharmaceutical companies that controlled the global vaccine supply. 

    “With Moderna we got two documents: a confidentiality agreement that was about entering a potential vaccine supply transaction and a summary framework about the principle terms of the proposed transaction. We also have several drafts of Pfizer procurement agreements. These include revisions from South African officials and commentary that showed their real time reactions to Pfizer’s proposed contractual terms,” he says. 

    He adds that they find a disturbing picture of how corporations can exploit public health emergencies to serve their own interest to the detriment of the health and safety of an entire nation. 

    “South Africa gave up millions of dollars to secure vaccine doses that had no certainty of reaching its residents in a timely manner. Government officials tried to include revisions that would have allowed for oversight by lawmakers and executive officials but none were included in the final agreement,” he says.

    He says Pfizer obtained iron clad confidentiality protections to safeguard its profits in the future and refused any and all flexibilities for public health which is unacceptable. 

    “So what becomes clear after reviewing these documents is that concentrated private power in public health emergencies allows pharmaceutical companies to seek and impose unjust terms on other nations. The consequences of their profit maximising motive are felt most harshly by those in low- and middle-income countries,” he says. 

    Ravinthiran says if these abuses are not addressed, it will be a risk that will allow them to continue in the future.  

    Government’s hands were tied

    Meanwhile, Dr Matthew Kavanagh the director of the Center for Global Health Policy and Politics at Georgetown University in the US adds that the government tried to address its international obligations and its obligations to its people. 

    “South Africa is the wealthiest country on the African continent. But it was unable to secure even the most basic provisions that would apply to contracting, good procurement, transparency and equitable access.”  

    He says it was the provisions of the contracts with the pharmaceutical companies that prevented South Africa from securing the basic things needed to run a good public health response in the middle of a pandemic. 

    “These documents illustrate the failure of global cooperation during COVID-19. `As a result, low- and middle-income countries are going to have to be ready to exercise compulsory licensing and other flexibilities that are built into the international trade law system, if they are going to be able to respond to pandemics and be able to bring down prices of drugs,” he says. 

    Peter Maybarduk ,access to medicine director at Public Citizen, praised the work done by HJI to develop historical records not just for South Africa but for the world.  

    “We have seen similar lessons out of Columbia, Brazil and other countries where contracts or fragments of contracts have come to light over the years and have been analysed. We see a similar pattern everywhere of extraordinary deference to drug makers during historic crises. We will have to do better in the future,” he says. – Health-e News

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