As the pandemic eased earlier this year, officials in Poland became vocal critics of the financial obligations laid down by Pfizer’s large vaccine supply pact with the European Union. Now, months after the country asked for a reprieve from the costs imposed by the 2021 agreement, Pfizer is targeting Poland in court.
Following a “prolonged contractual breach” and “lengthy discussions” with Poland, Pfizer is formally suing the country over its alleged failure to uphold its end of the immunization supply deal, a company spokesperson said. The company wants to “hold Poland to its commitments," the Pfizer spokesperson said over email.
Pfizer asserted that Poland failed to pay for some 60 million doses of the company’s BioNTech-partnered mRNA vaccine, according to the Central European Times. Pfizer is now seeking roughly €1.38 billion in compensation, according to the publication.
Pfizer and BioNTech sealed their large EU supply deal in May 2021, pledging an initial 900 million doses to be delivered in 2022 and 2023. Europe also had an option to order 900 million more doses in the future. In December 2021, European officials exercised part of the option and agreed to lock down another 200 million doses.
Back in May, Pfizer and BioNTech tweaked their delivery contract with the EU to account for slipping shot demand, ultimately reducing purchases of their vaccine Comirnaty by around 35%.
Pfizer’s spokesperson says that, similar to this amendment, Poland was given the option to spread doses across multiple years to better meet its needs on a year-to-year basis.
Still, many European countries, such as Poland, ultimately discovered they had too many doses as the COVID-19 pandemic abated.
In early May, Poland’s health minister Adam Niedzielski called on Pfizer to take “active corporate social responsibility” and lift financial burdens imposed by the EU agreement.
At the time, the Financial Times reported the parties were deliberating half payments for unneeded—and undelivered—doses.
But Poland wasn’t having it, with Niedzielski arguing the charges would be “literally for unmanufactured doses that have not yet been and will never be produced and thus will not cost Pfizer a penny.”
Meanwhile, after generating record revenues during the pandemic, Pfizer and BioNTech’s COVID sales have been on the decline for some time now.
Late last month, Pfizer reported $13.23 billion in revenues for the third quarter, down a whopping 42% from the $22.64 billion during the same period in 2022. At the same time, Pfizer recorded $5.6 billion in coronavirus-related inventory write-offs and other charges, plus a $4.2 billion revenue reversal tied to the planned return of some 7.9 million doses of the antiviral Paxlovid to the U.S. government.
BioNTech, for its part, recently slashed its 2023 sales projection by 20%. The company now expects sales this year to reach 4 billion euros ($4.3 billion) versus a previous estimate of 5 billion euros.