UK Cancels Valneva Covid Vaccine Contract

16.09.2021 - Three days after the UK canceled its vaccine supply contract with French drugmaker Valneva on Sept. 13, speculation was mounting that the European Commission might be prepared to take the 100 million doses Valneva was pledged to supply or even offer production facilities in an EU member state.

A French government source told the Reuters news agency that the EU is considering using the VLA2001 vaccine as part of its booster campaign plans, along with the shot being made by Sanofi and GlaxoSmithKline. The Commission did not comment on any fresh negotiations. Valneva and the EU had held vaccine talks last winter, but these are said to have ended inconclusively, as did the talks that were resumed in June.

In the first round, reports said Valneva’s prioritization of the UK’s order may have been a factor in the failure of talks. At the time, Europe was still sparring with AstraZeneca over the same – since resolved – issue.  Commercial rights to the strain of virus used in the drug substance, which the drugmaker had not yet secured, also could have been a hurdle, some said.

The news that the UK  was canceling the Valneva contract coincided with CureVac’s announcement that the German biotech was ending its vaccine manufacturing contracts with Germany’s Wacker Chemie and Switzerland’s Celonic group, as it shifted priorities away from its first- generation vaccine that disappointed in trials.

Drugmaker’s relations with the UK on black ice

In contrast to the presumably less disruptive break-ups between CureVac and its contract partners, relations between the UK and Valneva are skidding on black ice. Shares of the French pharma that reportedly quadrupled in price after it agreed to supply 100 million vaccine doses to the UK, plunged by 45% in Paris trading early this week, shaving off roughly $1 billion of its value. The stock meanwhile has bounced back to about 60% above its initial valuation.

The finances of US-based Dynavax Technologies, which has signed on to supply the adjuvant for the Valneva vaccine, also could potentially be strained by the collapse of the British deal, depending on whether Valneva finds other customers for its vaccine. A collapse clause allows the drugmaker to suspend payment for the adjuvant.

Neither Her Majesty’s government (HMG) led by prime minister Boris Johnson nor Valneva has provided details of what led to the ruptured relations. The drugmaker said HMG had unjustifiably accused it of breaching the contract although it had worked “tirelessly and invested significant resources” to meet requests for variant-derived vaccines.

Citing largely “commercial reasons,” HMG ministers have contended that the government was “within its rights.” But as sentiment seem to be going against it, health secretary Sajid Javid told Parliament that the vaccine would not have been approved by the UK Medicines and Healthcare products Regulatory Agency (MHRA).

Results of the ongoing late-stage Cov-Compare trial, which matches other vaccines’ performance against AstraZeneca’s, are expected this month. UK business newspaper Financial Times reported that Valneva’s was “one of the weaker candidates,” though the company’s management has claimed 80% efficacy – higher than AstraZeneca’s. In a letter to trial participants, Valneva stressed that it is still expecting MHRA approval before the end of 2021.

The French Covid vaccine candidate is made from an inactivated virus that targets the entire coronavirus rather than just its spike protein. The company says its is currently the only inactivated, adjuvanted, vaccine candidate in clinical trials against Covid-19 in Europe. Some scientists have said they thought the shot’s unique properties might make it more effective against virus variants, compared with those of competitors.

UK move stuns analysts and pharma industry

The British termination will surely require that commercial dose production be located elsewhere, to avoid any further discussion about vaccine “exports.”  As the Johnson government has sunk millions of pounds into the factory at Livingston, Scotland, where trial quantities currently are being made and also touted the candidate’s potential as a booster, London’s about-face stunned many. Some called it an odd twist, as the government that pushed Brexit across the finish line had been seen as practicing one-upmanship vis a vis France, where no vaccine doses have yet been produced.

Looking at its changed perspectives and taking a page from Wacker Chemie’s playbook, the drugmaker said it would increase efforts to find other customers. Commenting on the CureVac cancelation, Biosolutions division head Susanne Leonhartsberger had said the company was confident it could find other customers interested in the freed-up capacity for their mRNA and other molecules.

Analysts as well as the pharma industry expressed puzzlement at the British move. “We continue to see significant value in Valneva’s Covid-19 vaccine, but its route to market is now far less clear,” Stifl’s Max Herrman told the Bloomberg news agency.

Olivier Nataf, head of AstraZeneca in France, said in a radio interview, “It’s important to have a new vaccine, a new technology that would complement the others.” Pharma consultants noted that Valneva’s promising vaccine candidates for Chikungunya and Lyme’s disease should help the company cushion the financial blow. 

This story has been updated to include the EU’s potential engagement with Valneva.

Author: Dede Williams, Freelance Journalist