The EU’s Self-Inflicted Vaccine Debacle

O n the eve of the EU’s first antigen-type vaccine clearance, its rollout of COVID shots already had the look of a train wreck.

On January 29, the Oxford-AstraZeneca vaccine, a type known as “viral vector,” received a “conditional marketing authorization” for use in the EU on the recommendation of the Union’s European Medicines Agency (EMA). But a week earlier, the company’s expected lead role in vaccinating the EU’s population of 450 million had begun to run into trouble. The next few weeks may determine whether the EU’s response to the pandemic manages to become, if belatedly, an adequate one or whether the EU’s citizens will keep dying at high rates, with policy failure exacerbating the pandemic’s natural toll. The EU is home to around 5.74 percent of the global population, but its cumulative COVID-19 deaths will soon reach a full 19 percent of the world’s total.

The new vaccine uses a tweaked version of SARS-CoV-2 triggering antibodies. The EMA, the EU’s equivalent of the FDA, had issued approvals for the Pfizer-BioNTech vaccine (under the brand name Comirnaty) in late December and the Moderna vaccine in early January, but the steeper delivery costs of this competing genre of vaccine, termed “mRNA,” and general concerns about the unknowns of a new type of vaccine, had persuaded several EU members to stake virtually their entire national plans for vaccine delivery on Oxford-AstraZeneca. As the bloc’s vaccination rate lags far behind that of comparable Western countries — a meager 2.6 doses per 100 people, as opposed to 60 in Israel and nine in the U.S. — this gambit looks increasingly misguided. The Commission had to bring all member states into agreement on a single procurement plan, and they settled on one that relied heavily on AstraZeneca. Ultimately, the Commission procures the vaccines but the countries deliver them to their citizens, so now that AstraZeneca’s role in the supply chain is compromised, all 27 countries are seeing their delivery plans upset.

On January 22, AstraZeneca’s CEO Pascal Soriot announced to the EU’s Vaccine Steering Board — the panel of EU bureaucrats and member-state health officials convened to run the bloc’s joint vaccine program — that 75 percent of the doses it was hoped his company would deliver before April won’t be there on time. The EU is crying foul, but its claim to be a victim of corporate malfeasance looks a lot like an attempt to shift the blame. Granted, AstraZeneca’s excuse that it ran into unforeseen shortages and manufacturing defects at its main plant in Belgium is thus far unsubstantiated; but at worst it’s a breach of the EU Commission’s confidence, as the company had agreed only to make a “best reasonable effort” in its pre-clearance supply deal from August.

But whatever AstraZeneca’s shortcomings, they appear to have been more than matched by the Commission’s, which encompass far more than possibly botching the negotiations with the company. This is a serious matter, given the way the Commission pressed to be given omnicompetence for the bloc’s entire procurement of vaccines. As would be normal for any vaccine destined for the EU market, the regulatory approval process rested with the EMA. The EU is not known for its flexible approach to regulation, and, in keeping with that stringency, the EMA was, pandemic or no pandemic, less willing than its counterparts in the U.S. and the U.K. to speed up the approval process. AstraZeneca was granted its approval and supply deal in the EU with a three-month lag relative to the U.K. each time (to be fair, it should be noted that, at the time of writing, the FDA has yet to approve AstraZeneca’s vaccine).

EU Health Commissioner Stella Kyriakides has also accused AstraZeneca of making excess profit by shipping to the U.K. doses produced under its agreement with her department; she sounded confident that customs data could leave the company legally exposed. The first-come, first-served logic that AstraZeneca invokes, she said, “may work in a butcher’s shop but not in contracts and not in our advanced purchase agreements.” Under the terms of the contract that the two parties agreed to disclose on January 29, four AstraZeneca plants had been selected as production hubs under the August contract — two in the U.K., one in Belgium, and one in Germany. The Commission hopes to put AstraZeneca on the legal back foot by demonstrating that the company has been serving the U.K. market at least partly out of the very same Belgian plant where the company claims shortages and glitches prevented it from supplying the EU.

While the two sides were (doubtless) lawyering up, AstraZeneca began turning over all shipping records of EU-produced doses to the Commission’s trade department, as it swiftly rolled out an export-authorization regime that could well lead to an outright export ban on shipments to the U.K. (we’ll discuss how “U.K.” may be defined for these purposes a bit later) as the dispute unfolds. Never mind that all EU-produced vaccines undergoing authorization, AstraZeneca’s or otherwise, stem from a complex set of world-spanning supply chains, meaning that the EU could be a victim were this protectionist turn replicated in countries where these inputs are sourced. What’s more, were both Oxford-AstraZeneca and Pfizer-BioNTech to further fall short of their planned output for a prolonged period, these export restrictions could dissuade new entrants from filling the gaps ­— further dimming the EU’s prospects of emerging from its COVID-19 impasse. Pfizer-BioNTech, the top mRNA-type contender, is also falling short on its initial supply commitments to the EU for reasons similar to those put forward by AstraZeneca, so that prospect can no longer be ruled out. For a bloc that lambasted the U.K. for “vaccine nationalism” when the country made the most of its newfound autonomy for the purposes of approving and delivering vaccines, the optics couldn’t be worse. (Even the German tabloid Die Zeit has referred to the debacle as “the best advert for Brexit.”)

Yet things did in fact get worse for a few hours last Friday. Once the details of the new authorization regime were revealed, it was evident that the EU was, for these purposes, treating the U.K. as a single trading unit. As originally drafted, the EU’s rules could have meant checks at the border for vaccine exports from the Republic of Northern Ireland. This ran against the spirit of, if not (quite) the arrangements contained within, the Northern Ireland protocol, which was elaborately designed to resolve one of the trickiest issues in the bitter Brexit negotiations: how to avoid creating a “hard” border between Northern Ireland and the Irish Republic without cutting off Northern Ireland from the rest of the U.K. Technically, the EU was (probably) entitled to do this, under the protocol’s clause 16, which, as the BBC explained, “allows the EU and UK to choose to suspend any aspects they consider are causing ‘economic, societal or environmental difficulties,’” but what works technically may not work politically.

The Commission backtracked to assuage the outrage of the Irish, British, and (on both sides of the sectarian divide) Northern Irish establishments (it was quite an achievement for the EU to have brought all these into agreement), but any hope that this might calm things down were sunk by the EU’s Health Commissioner. Beyond the dispute over what has already been delivered — or not delivered — Kyriakides insisted that people in the EU should not be given lower priority than British citizens to receive future doses manufactured in Oxford and Staffordshire, AstraZeneca’s two U.K. plants covered in both the EU and U.K. agreements. The company is meanwhile making the case that its contractual obligations in the U.K. outweigh its “best reasonable efforts” agreement with the EU, and unless it is stopped in Belgian court, it will likely keep delivering vaccines to the U.K. at a faster rate than to the EU.

Regardless of the dispute’s outcome, the vaccine rollout has presented the EU with a test of its ability to govern competently that in its urgency and its seriousness even exceeds the two most critical challenges of the recent past (the euro zone’s travails of a decade ago as well as the 2015 migration crisis). On this occasion, the Commission took the opportunity afforded by the pandemic to demonstrate that it could be entrusted with protecting its citizens. So far, that’s not working out too well, yet the more than 436 million Europeans expecting Commission-procured shots in their arms have little direct way of exerting pressure on the bureaucrats running the show.

In the least-bad scenario, the Commission’s inquiry into AstraZeneca’s deliveries from Belgium would find enough to support the case that the EU was merely insisting on its contractual rights rather than doing anything that could be seen as detracting from its (supposed) devotion to free trade. This could then, if necessary, provide enough cover to support COVID-19 protectionism against a country it claims remains a key friend. But even under this scenario, the Commission will still have been exposed as an inept planner. Given that the continent’s economic recovery is contingent on a high level of herd immunity across the single market, the consequences of this debacle dwarf the success of the EU’s July deal securing €750 billion in transfers to fund COVID-19 relief. In fact, they threaten that deal, raising the prospect that a further round of financial burden-sharing will be needed to address the virus’s protracted presence, with perilous consequences for the bloc’s sometimes shaky (at least when it comes to financial matters) political cohesion.

And we should not overlook what this tragic fiasco reveals about the EU, and, for that matter, about those who cheer it on. Beyond the tabloids, there has been far less criticism than there would have been had this bungling taken place at the national level rather than in Brussels. Given the toll that the pandemic (and now the EU’s slow response to it) is taking, this unwillingness to criticize may reveal that the EU-integrationist establishment media is unwilling to say what it knows about what’s going on; or it may indicate the suspicion that anger will make no difference. Unburdened by the accountability that comes with not having to run for election, Eurocrats have proved over the years to be chronically unable to look beyond their own regulatory and planning failures, and the lack of a mea culpa from Brussels this time, other than over Northern Ireland, is a critical symptom of the same.

After 2016, the EU refused to learn from the message sent by the 17 million Brits who opted for Brexit, choosing instead to condition potentially win-win access to its internal market on a level of hyper-regulatory harmonization that jeopardized relations with what ought to be a reliable ally. Its failure to properly contain migrant inflows through Greece and Italy in 2015 fueled a populist backlash, which it failed to read as the wake-up call that it was. And now, once again, the bloc’s leadership is opting for ideology over reality, as it sticks with an elite commitment to supranational governance that seems impervious to policy failure or, it seems, the deaths of its own citizens.