Health Desk – 08 Apr, 2021: AstraZeneca has sent a legal notice to the Serum Institute of India over vaccine supply delays, Indian media outlets report.
“AstraZeneca has sent us a legal notice (for delays in supplying the vaccine) and the Indian government is also aware of that. I cannot comment on the legal notice as it is confidential, but we are examining all avenues to amicably manage and resolve legal disputes over contractual obligations that Serum Institute is not able to fulfil due to its prioritisation of Indian supplies,” CEO Adar Poonawalla of SII said in an interview with India’s Business Standard.
“Everyone has been very understanding so far. The government is evaluating what it can do to resolve the issue.”
Poonawalla had told NDTV that Serum’s production capacity to manufacture Covishield — one of the two vaccines being administered in India — is “very stressed, to put it frankly”, amid pressure from soaring cases in the country.
He also said the government’s pause on major Covishield shipments to other countries and the “first claim” deal with India were difficult to explain abroad, where the vaccine was sold at a substantially higher cost per dose.
The world “needs this vaccine and we are prioritising the needs of India at the moment and we are still short of being able to supply… to every Indian that needs it”, Poonawalla said in the interview.
Poonawalla said SII, which produces between 60 million and 65 million doses per month, has so far delivered around 100 million doses to the centre and exported 60 million.
SII needed Rs 3,000 crore to ramp up capacity needed to scale up production by June, he said.
Serum produces over two million doses of Covishield — the name in India for the AstraZeneca vaccine — a day. It is providing the shot at a subsidised rate of around Rs 150 to the government, significantly less than what it charges for exports.
“We’re supplying in India at approximately Rs 150-160. The average price is around ₹ 1,500… (but) because of the Modi government’s request, we are providing at subsidised rates… It is not that we’re not making profits… but we are not making super-profits, which is key to re-investing,” he said.
“This (the amount needed) would be roughly Rs 3,000 crores. The process takes 85 days, so it would be just under three months before we scale up operations,” he said, adding that he had written to the government, failing which Serum Institute would approach banks for a loan.
“This was never budgeted or planned initially because we were supposed to export and get the funding from export countries but now that that is not happening, we have to find other innovative ways to build our capacity.”
Poonawalla said even if SII could increase its capacity to around 100 million doses per month, India needed other manufacturers to scale up in order to meet requirements.