Refunds declined for canceled shots

When COVID-19 vaccines were in high demand, developing countries had to wait in line behind developed countries that were able to pay more to reserve the doses.

Now with demand for the vaccines waning, drug companies have declined to refund $1.4 billion in advance payments made for orders of millions of vaccine doses that lower-income countries later sought to cancel, The New York Times reported on Wednesday.

An organization responsible for providing vaccines to lower-income countries is also negotiating with pharmaceutical companies to cancel the vaccine orders it no longer needs, the Times reported.

Under the contracts, the drug companies are not obliged to return prepayments to reserve vaccines that were canceled by Gavi, the Vaccine Alliance.

Gavi reached agreements with leading vaccine makers to buy the shots on behalf of Covax, a vaccine-sharing initiative backed by the World Health Organization to improve vaccine access in lower-income countries.

Some public health experts have criticized the drug companies' actions given the number of vaccine doses Gavi had to cancel, the Times reported.

The drug companies were giving priority to higher-income countries that could pay more to lock up the first doses, while a significant number of developing countries could not begin to get their shots until late 2021.

When vaccine supplies began to pick up, the demand also started to drop, prompting Gavi to cancel orders.

Seth Berkley, chief executive of Gavi, told The Washington Post that because of lower demand, Covax expects to deliver about 400 million doses globally this year — less than half of the 1 billion or so doses it had been delivering each year, mainly to lower-income countries in the past two years.

Citing confidential documents, the Times said Moderna, the Serum Institute of India and several Chinese manufacturers have agreed to cancel the orders, surrendering $700 million in prepayments.

Novavax is refusing to refund another $700 million in advance payments for shots that it never delivered.

Gavi and Johnson & Johnson are also locked in a dispute over advance payments on 150 million COVID-19 vaccine doses that Gavi ordered, the Times reported.

Gavi had been expecting a significant share of those doses to be distributed by the end of 2021, but J&J had delivered fewer than 4 million doses by then.

According to the documents, the Times said Gavi's administrators told J&J it would not need that many shots, but the company manufactured them anyway. Now the company wants Gavi to pay even more and to accept the vaccines.

Vaccine makers have made more than $13 billion from vaccines distributed through Covax.

'Special responsibility'

COVID-19 vaccine manufacturers "have a special responsibility "because their products are a societal good, and most of them were developed with public funding, Thomas Frieden, chief executive of the global health nonprofit Resolve to Save Lives, told the Times.

"That's a lot of money that could do a lot of good," he said of the payments drug companies will not refund.

According to Our World in Data, 20 percent of the population in lower-income countries were fully vaccinated by mid-December. Fewer than two booster shots per 100 people had been administered across the population in those countries, the Post reported.

Covax delivered fewer than 29 million doses in November, less than a tenth of what it delivered in the same month in 2021, and its lowest number since June 2021.