Brazil suspends Bharat Biotech's Covaxin order over graft allegations

The Brazilian government on Wednesday announced temporary suspension of its 20 million dose Covid-19 vaccine contract with Bharat Biotech following allegations of irregularities in the deal, with the Indian drug maker insisting that it has not received any advance payments.

The city-based firm said it has not received any advance payments and that the company has followed a "similar approach" in Brazil towards contracts, regulatory approvals and supplies in several countries worldwide, where Covaxin is being supplied successfully. Announcing the Brazil government's decision, its Health Ministry said in a statement that "with the recommendation of the Office of the Comptroller General of the Union (CGU), the Ministry of Health temporarily suspended the contract for the purchase of Covid-19 vaccine from Covaxin this Tuesday (29)."

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"The measure does not affect the pace of the vaccination campaign to fight the pandemic in the country and follows compliance practices in public administration," it said. The contract was also evaluated by the Ministry of Health's Integrity Directorate, which will carry out an administrative investigation. The unit will act together with the "Controllership" in determining the terms of the contract, it further said.

Responding, Bharat Biotech said the company has not received any advance payments nor has it supplied any vaccines to Brazil. "As of 29th June 2021, Bharat Biotech has not received any advance payments nor supplied any vaccines to MOH Brazil."

"Bharat Biotech has followed a similar approach towards contracts, regulatory approvals and supplies in several countries worldwide, where Covaxin is being supplied successfully," it said in a statement. Precisa Medicamentos is Bharat Biotech's partner in Brazil, providing assistance, guidance and support with regulatory submissions, licensure, distribution, insurance, conduct of phase III clinical trials, etc.

The Covaxin contract to Brazil landed in controversy after the South American country's Attorney General reportedly launched a probe into the deal. The minister of the CGU, Wagner Rosrio, explained that the suspension is a preventive measure. "We opened a preliminary investigation last week, that is, a specific audit in relation to the contract. The suspension time will only last for the period of calculation. We put the reinforced team to be very quick in the process," he said.

The CGU said it began a preliminary investigation into possible irregularities in the contracting of Covaxin on June 24. "By recommendation of @CGUonline, we decided to temporarily suspend the Covaxin contract."

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According to CGU's preliminary analysis, there are no irregularities in the contract, but, due to compliance, the @minsaude opted to suspend the contract for further analysis," Brazil Health Minister Marcelo Queiroga tweeted. On February 26, Bharat Biotech Ltd had said it entered into an agreement with the Brazilian government for the supply of 20 million doses of Covaxin during the second and third quarters of 2021.

Earlier, the National Health Surveillance Agency of Brazil- Anvisa, had denied permission to import Covaxin under Emergency Use Authorisation after authorities found that the Indian plant in which the jab was being made did not meet the Good Manufacturing Practice (GMP) requirements. However, Anvisa on June 5 gave clearance to the proposal to import Covaxin into the South American country, with some conditions.

The Emergency Use Authorisation for Covaxin was granted by Brazil on June 4. The pricing of Covaxin has been clearly established between $15-20 per dose for supplies to governments outside India. The pricing for Brazil has also been indicated at $15 per dose.

Bharat Biotech has received advance payments from several other countries at the above price points, with supplies in process, pending approvals, Bharat Biotech said. The company follows a similar partnership model in all countries, where its vaccines are supplied, as it does not have its own offices there. Bharat Biotech and Precisa Medicamentos are conducting a 5000-subject phase III clinical trial in Brazil, which was recently approved by Anvisa. The trial will be conducted by the Albert Einstein Institute, the vaccine maker said.