Explained: Covid-19 vaccine indemnity and compensation

The government is negotiating a middle path for international companies like Pzifer, who are demanding indemnity

The Centre has held multiple rounds of discussion with pharma giants Pfizer and Moderna over the supply of their Covid-19 vaccines in India, the point of contention being the question of indemnity.

This has raised many questions in the minds of people regarding what indemnity entails. Here's all you need to know:

What is vaccine indemnity?

Indemnity protects the producers from being sued in case their Covid-19 vaccine shows any adverse effects. The vaccine producers are demanding indemnity as they manufactured the vaccine in a very short period of time to fight the pandemic and their vaccines may show unknown side effects.

It must, however, be noted that grant of indemnity doesn’t mean that the beneficiaries cannot demand compensation in case of any adverse events, but grant of indemnity sets the bar high.

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Has the Indian government granted indemnity to any vaccine producer?

The Indian drug regulator has not yet granted vaccine indemnity to any of the three Covid-19 vaccines currently in the market -- Covishield, Covaxin and Sputnik V.

The government has laid out rules in case of any adverse effects during the trial phase of the vaccines. However, there are no such laws for commercial vaccines under the Drugs and Cosmetic Act.

The government is negotiating a middle way for international companies like Pzifer who are demanding indemnity. “Similarly, they (Pfizer) have requested indemnity from all nations. That is their expectation, that liability should be indemnified. They have expressed this in legal language. We are examining this request and we will make a decision in the larger interest of people and on merits. This is under discussion but there is no decision as of now,” Dr V K Paul, head of India’s Covid-19 task force, told The Indian Express.

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Which countries have granted indemnity and do they provide compensation?

Countries like the US and the UK have granted vaccine indemnity to some Covid-19 vaccine producers.

The US government, which started its vaccination drive back in December 2020, granted immunity from liability to both Pfizer and Moderna for their m-RNA Covid-19 vaccines. This will protect the two big vaccine companies from lawsuits arising from any medical complications due to their vaccine until 2024.

However, through US Countermeasures Injury Compensation Program (CICP), individuals who suffer from serious adverse effects due to the Covid-19 vaccines can file for compensation.

Similarly, the UK has a Vaccine Damage Payment scheme. It is not a compensation scheme, but any individual who suffers from severe physical disability due to certain vaccines can receive a one-off tax-free payment of £120,000.

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What happens to vaccines distributed through COVAX?

Through World Health Organisation’s (WHO) COVAX facility, the members will have to provide indemnity and no-fault compensation for faster availability of Covid-19 vaccines.

WHO’s “No-Fault compensation programme”, started in February, is available for rare but serious adverse events after administering COVAX-distributed vaccines until June 2022. This is available for 92 low- and middle-income countries across the world.