Pfizer’s Sordid Vaccine Sales Practices in Latin America Could Be a Big Boon for China and Russia

Vaccine politics could end up nudging countries in the region even deeper into China’s orbit. As vaccines fail to materialise in many countries, doctors turn to cheap, widely available off-patent drugs such as Ivermectin.

It is a time-honoured custom of business that manufacturers provide certain basic guarantees to prospective buyers about their product’s quality and safety. But U.S. pharma giant Pfizer wants to turn this on its head as it sells its experimental mRNA vaccine to desperate governments around the world. For Pfizer, it’s the buyer — not the seller — that should provide all of the guarantees. And that includes countries putting up sovereign assets, such as federal bank reserves, embassy buildings and military bases, as insurance against the cost of any future legal cases involving Pfizer BioNTech’s vaccine, reports the Bureau of International Journalism (TBIJ):

In the case of one country, demands made by the pharmaceutical giant led to a three-month delay in a vaccine deal being agreed. For Argentina and Brazil, no national deals were agreed at all. Any hold-up in countries receiving vaccines means more people contracting Covid-19 and potentially dying.
Officials from Argentina and the other Latin American country, which cannot be named as it has signed a confidentiality agreement with Pfizer, said the company’s negotiators demanded additional indemnity against any civil claims citizens might file if they experienced adverse effects after being inoculated. In Argentina and Brazil, Pfizer asked for sovereign assets to be put up as collateral for any future legal costs.
One official who was present in the unnamed country’s negotiations described Pfizer’s demands as “high-level bullying” and said the government felt like it was being “held to ransom” in order to access life-saving vaccines.
Campaigners are already warning of a “vaccine apartheid” in which rich Western countries may be inoculated years before poorer regions. Now, legal experts have raised concerns that Pfizer’s demands amount to an abuse of power.
“Pharmaceutical companies shouldn’t be using their power to limit life-saving vaccines in low- and middle-income countries,” said Professor Lawrence Gostin, director of the World Health Organization’s Collaborating Center on National and Global Health Law. “[This] seems to be exactly what they’re doing.”
Protection against liability shouldn’t be used as “the sword of Damocles hanging over the heads of desperate countries with a desperate population,” he added.

Zero Responsibility

Nine Latin American countries have so far agreed to buy vaccines from Pfizer: Chile, Colombia, Costa Rica, Ecuador, Mexico, Panama, Peru, Uruguay and the Dominican Republic. The terms of these deals are unknown since all of the deals included a confidentiality clause. In the case of Argentina, the government acceded to almost all of Pfizer’s demands. But it insisted that Pfizer pay out in the event of negligence. Even that was a bridge too far for the drug maker.

It’s not unusual for governments to exempt companies of some degree of liability for the vaccines they manufacture. Since manufacturers develop the vaccines quickly and on a massive scale, governments often agree to cover some or all of the cost of compensation.

If a citizen suffers serious side effects after being vaccinated, they can file a claim against the manufacturer. If successful, it’s the government — not the company — that ends up paying the compensation. Getting paid is often easier said than done, however. Attorneys in the U.S. say that less than 6% of the claims filed in the past decade resulted in payouts.

But what Pfizer is after — and is presumably securing from many of the countries that sign on the dotted line — is additional indemnity from civil cases, says Gostin:

“[T]he company would not be held liable for rare adverse effects or for its own acts of negligence, fraud or malice. This includes those linked to company practices – say, if Pfizer sent the wrong vaccine or made errors during manufacturing.
“Some liability protection is warranted, but certainly not for fraud, gross negligence, mismanagement, failure to follow good manufacturing practices. Companies have no right to ask for indemnity for these things.”

Some may argue, in Pfizer’s defence, that it did not participate in the U.S. government’s “Warp Speed” vaccine initiative. Therefore it did not receive up-front federal funding for its research. As a private company, it is well within its rights to set whatever terms it wants in its negotiations with national governments. 

But these arguments are largely spurious. Pfizer did have an advance purchase agreement with the U.S. government worth $1.95 billion, which will have covered most, if not all, of the research costs. On top of that, Pfizer’s vaccine partner, BioNTech, received €375 million in subsidies from Germany’s Ministry of Health. Perhaps most important of all, Pfizer’s total abdication of responsibility for its own acts of negligence, fraud, mismanagement or failure to deliver does not inspire confidence. And given Latin America is one of the regions worst hit by Covid, the optics could not be worse.  

A Big Boon for Other Vaccine Manufacturers

Some nations in the region are looking elsewhere for supplies, in particular to Russian, Chinese and British-Swedish manufacturers.

  • In December, Brazil’s Senate approved the purchase of 100 million doses of the AstraZeneca-Oxford vaccine, which are set to arrive in the first half of 2021. National health regulator Anvisa has also approved a second request for emergency use of Chinese firm Sinovac’s shot, to be produced locally.
  • Argentina has agreed to purchase 22 million doses of the AstraZeneca-Oxford vaccine. Most of them will be produced domestically. An Argentinean lab is churning out 18 million doses a month of the vaccine, reports El País. But they cannot be used yet due to lack of basic supplies, such as filters, sterile bags and vials, at the Mexican laboratory responsible for finishing the product. Argentina is also hoping to purchase 10 million doses of the Russian-produced Sputnik V vaccine.
  • Mexico has struggled to secure an adequate supply of vaccines. The flow slowed to a trickle in early February 2021, largely due to a slowdown in shipments of supplies. Pfizer has so far delivered none of the 34 million doses Mexico has reserved. Mexico is also awaiting the arrival of 24 million doses of Sputnik V, 35 million doses of the Sinovac vaccine and is also hoping to finally begin production of the AstraZeneca vaccine in the coming weeks. To date the country has approved five vaccines — Pfizer, AstraZeneca, Sputnik V, CanSino, and SinoVac — but as of February 8 had only administered 718,000 doses.

Five LatAm countries — Uruguay, Salvador, Guatemala, Honduras and Cuba — still hadn’t  received a single vaccine from overseas as of last week, according to the BBC. Cuba has produced its own vaccine, dubbed Soberana 02, which is currently waiting for domestic approval.

At least 10 Latin American countries have signed contracts with AstraZeneca. The Russian Direct Investment Fund has also reached agreements with at least six Latin American countries to supply more than 60 million doses of Sputnik V. Other countries have said they are considering both Sputnik V and the Sinovac vaccine, not just because they are cheaper and easier to store but also due to the less onerous contractual terms.

As such, vaccine politics could end up nudging countries in the region even deeper into China’s orbit. China is already the most important trade partner for four South American economies: Brazil, Chile, Peru, and Uruguay. For the British-Swedish firm Astra Zeneca Pfizer’s scandalous sales practices could also represent a much-needed fillip after its own recent trials and tribulations trying to sell its product in the EU as well as the trouble it’s been having at its factory in India.

Alternative Treatments

In the meantime, as Latin America waits for the vaccines to materialise, doctors in the region have turned to cheap, widely available drugs that have shown promising results in the treatment of Covid. They include Ivermectin, a “well-studied, well tolerated,” (in the words of an FT article from 2013) off-patent anti-parasitical. According to a meta-analytical breakdown of 18 studies, the drug could cut the number of deaths from Covid-19 by as much as 75%.

But the jury is still out. Many front-line doctors want to prescribe it but healthcare bureaucrats are dragging their feet. But in Latin America there are always ways of getting around things.

In Argentina Ivermectin has been widely used in some provinces despite still awaiting national approval. In January, the Secretariat of Health of Mexico City and Mexico’s Institute of Socal Security (IMSS) allowed Ivermectin to be prescribed to outpatients with Covid. Ivermectin, the Secretariat said, had significantly reduced patients’ viral load, with very few adverse effects. A day later, an official group of health experts condemned the decision, arguing that there’s no scientific evidence that the drug is effective, and called for its immediate repeal.

To their credit, both the Secretariat and IMSS have stuck to their guns. With virtually no vaccines currently available, what alternatives are there anyway?

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  1. vlade

    Re Sputnik.

    The problem with it is that Russia does not have enough capacity (I know it’s actively seeking partners for manufacturing, but that takes time).

    At the moment, less than 30m of Sputnik doses were delivered outside of Russia, and only 5m Russians were vaccinated*), so say 35m doses total.

    *) Which is less than Sputnik doses Mexico got, and makes you think whether a) Russians don’t want to be vaccinated or b) Russia prefers using Sputnik as a geopolitical tool over securing health of its citizens.

    1. PlutoniumKun

      Yes, there is something a little odd going on with Sputnik so far as I can see – Russia seems way behind on vaccinations despite having had such a head start. I’d wondered if the Russians had believed some of their own propaganda about not having a serious potential problem with Covid.

      I wonder how well or otherwise its going down with elderly Russians when they see millions of shots been delivered abroad if they can’t get one.

      1. WinterM

        Based on my conversations, at least in big cities in Russia one can get vaccinated within a day on an appointment with no age/conditions limits.

    2. Erelis

      The Russians have made it clear that they cannot provide out of their own domestic production the total needs of other countries. But are willing to give all pertinent technical information for others to make Sputnik V. As of now, India has signed up to produced something like 300 million doses and Argentina has signed up to produce Sputnik V.

      A fairly good bet is that Biden admin and EU will try to sanction the Russians over their vaccine. EU officials are claiming they never received the paperwork for EU approval on use of Sputnik V. Russians claim they submitted proper paperwork. This was after the Lancet articling showing 90+ percent effectiveness of Sputnik V. US and Eu probably use the excuse of bio-weapons for sanctions to protect 2nd and 3rd world profits of American vaccines.

      From what I have seen, the American and British vaccine makers are having enough manufacturing issues just providing their first world customers. Does not take much imagination to see in the third wave of the virus a sickened and locked down first world, and a healthy 2nd and 3rd world emerge at the end of the current year.

  2. madarka

    The scant info made available on the Dominican Republic’s contract with Pfizer states that the delivery schedule is in no way binding, that the company bears no liability if it isn’t fulfilled and the country can’t cancel the order. The schedule is also subject to a confidentiality agreement. All responsability for adverse effects and such, as stated in this article, falls on the Ministry of Public Health; and it must ensure this to Pfizer’s satisfaction. The contract is under NY law and any contrversy regarding it will fall under the Internationnal Commerce Chamber’s arbitrage rules.

    DR bought 8 million doses, and is supposed to start receiving some in april. Another 10 million from Astra Zeneca was purchased, and only 90,000 were received from India’s Serum Institute; 60,000 of those were a donation. So now the Government has purchased nearly 3 million from Sinovac, and has received around 800,000 doses so far, enough to start vaccinating medical staff and people over 70. The rest will arrive in staggered deliveries during this month.

    It’s a funny ol’ world: from the US we got crickets, even after slavishly following the US line regarding chinese investment in the country. But China is delivering and people are queueing up to get vaccinated.

    1. vlade

      This is the reason why the small EU countries are glad for the EU contract. If they were on their own, it could easily be as bad as this. Never mind that the EU as the only one actually secured some product liability.

      It doesn’t mean they could not negotiate a better contract (for example trading faster deliveres for a slightly higher price, or set the price to a timetable – the earlier you deliver, the more money you get), but at least it’s a contract that actively helps the small EU states.

      1. PlutoniumKun

        Yes – in all the criticisms of the EU performance, this has been forgotten. The alternative would be a nightmare, with individual countries trying to outbid each other. The only defence against corporate marauding of this type is monopsony buying power, and thats one thing the EU is good at.

    2. The Rev Kev

      Vaccine delivery is a real mess. A reporter just asked Psaki about the US sharing vaccines with Mexico and she said “The administration’s focus is on ensuring that every American is vaccinated. And once we accomplish that objective we’re happy to discuss further steps’ so Mexico is all out of luck there. This would have been a rely to the Mexican president asking Biden for help with vaccines. And I have my doubts about the EU contracts that have been arranged. ‘Chancellor Sebastian Kurz has announced plans to break away from the EU’s joint vaccine procurement program to create a second-generation Covid-19 vaccine and explore treatment options for the virus.’ That does not sound like a vote of confidence to me in the EU. Also Czech PM Andrej Babis has said that local approval would be enough to go ahead with using the Sputnik V vaccine without waiting for approval from the EU which may or may never come. Last I heard, the Czech Republic is really being hammered hard by the pandemic so are looking for all options-

      1. vlade

        In the CZ the problem is not the lack of the vaccine, but the lack of the ability to deliver the vaccination. There’s probably over 200k, possibly as many as 300k doses sitting there, not used. That is in a situation where there’s something over 400k total first doses delivered, and about 200k second doses.

        The Sputnik in this context is purely a political play, as CZ can’t effectively even use what it has (and it’s unlikely it’d be able to receive Sputnik in any numbers that would make a difference). For example the fact that Israel sent 5k vaccines, France is giving CZ 100k vaccines, Germany as well (didn’t put a number out yet, but likely similar or even larger), and offering hospital beds is not nearly as politically attractive as “Czechs receive Sputnik”.

        Slovakia yesterday received 200k doses of Sputink – but I very much doubt it receives that much more (because Russia just doesn’t have it). Slovakia delivered 300k first doses and 140k second doses (so population-wise is doing much better than twice-as-large CZ, but still not great).

        Austria vaccinated similar no of people as CZ, but I don’t have data on how many doses vere delivered by the EU there, so can’t compare. That said, population wise Austria is just short of Czech Republic, so would expect similar no of doses, which would imply the no of vaccines is not the bottleneck.

        As an imprortant note, the individual EU states CAN approve Sputnik (or whatever else medications they want) w/o approval from the EU authorities on an emergency basis. And the EU could not approve Sputnik even on an emergency basis for wide use w/o phase 3 trial data, which was made available only recently.

        I’d also point out that at least CZ and Slovakia (but I think Austria to an extent to, cf Germany closing the border with Austria) had a bad situation made worse by massively incompetent governments that over the last six months lost trust of the populace, and now are trying to find scapegoats.

        1. The Rev Kev

          I had really thought last year that CZ would be one of those countries that would be one of those able to avoid the worse of the pandemic. I still remember their “My mask protects you, your mask protects me” campaign and it seemed to be working. But over the past few months I have seen all sorts of stories out of the CZ so I guess that it all fell apart unfortunately.

          1. Alena Shahadat

            Czechs had succesfully avoided the first wave after a prompt lockdown and closing their borders after discovering only a couple of cases. In the autumn last year, the numbers of cases started raising with the brittanic variant but the politicians weren’t ready to bog down their popularity by strict measures for the coming regional elections. Result: 18 000 deaths between november and now against only 2 000 between february and november last year. After we were “brothers” for 50 years with Russians, I thought we knew them better than to run after their vaccine.

    3. flora

      US govt’s blind worship of neo-liberal economics – private companies are (suppposedly) better than govt programs in achieving even govt ends, and US private companies must not be restricted in any way from the pursuit of profits – is undoing 70-80 years of US soft power in Europe, Asia, and South America. my 2 cents.

  3. Bob

    Yes, China is delivering not only vaccine. China also is able to deliver commerce via the Belt and Road initiative, to deliver investment in raw material extraction for everything from coal, cotton, timber, metal ores.

    Mean while the US putzes along insuring that one giant global corporation after another waxes fat.

    It appears that China has a clear long range plan while the US simply supports the biggest corporate donor of the day.

  4. Altandmain

    This was linked by Naked Capitalism before, but for many nations, if the Western vaccines are unaffordable due to the overwhelming intellectual property laws, China might be the winner as the NC article hints.

    The irony is that the Western world will have damaged a lot of goodwill. Lobbyists and profits took precedent over human need.

    The solution is to suspemd IP laws.

    1. Altandmain

      Also related to the article – nobody truly knows if there are going to be side effects.

      If the Pfizer vaccine does turn out to have problems (or any of the vaccines), that means that national governments are basically on the hook and already hurt by the virus financially may fall into ruin.

    2. tegnost

      Re: goodwill…
      I think it matters less the number of vaccines offered by china and russia than their willingness to help, while the US says the same thing it always does. We want everything. Period. You get nothing. Send your kids to work in the us if you want anything, we’ll pay them less than minimum wage and foreign workers should be happy because they are helping the elite take everything from americans.
      Fireship commented yesterday that americans are horrible. There was push back, it’s our leaders etc…, but when the rest of the world gets sick of us, and it will happen, the blame will be on all of us.

    3. Bill

      Astra zenica vaccine is been sold at cost during the pandemic. This was the condition that oxford university negotiating for their participation. Some countries get a discount because of involvement in its development, ie european countries.

      If Astrazenica are selling at above cost price, they are breaking their contract with oxford. But since all these contracts are secret, we dont know. Why all the secrecy?

  5. Arizona Slim

    If Mexico is allowing Ivermectin to be prescribed to outpatients with COVID, I expect that it will soon be available at border pharmacies that do a brisk business in selling to Americans.

  6. tegnost

    the other Latin American country, which cannot be named as it has signed a confidentiality agreement with Pfizer

    corporation vs country. You know who the IMF wants to win…
    I think it’s a bad thing.

  7. Taurus

    I notice that when the [anglo] Western press writes about vaccine, they often do not mention Sputnik or the SinoPharma vaccines. It is as if they do not exist or are simply not worth mentioning. The irony is that the Russians actually helped Astra Zeneca when they were struggling with formulating the second shot for optimal efficacy.


    Goes against “Evil Putin” meme though.

  8. Sunny Roads

    Cuba is actually working on four different versions of a Covid-19 vaccine.
    Among other things, the Cuban vaccines will have the advantage that they can be kept at a temperature of 2 to 8 degrees (Celsius).
    I am translating a bit from the article linked below, from the Spanish newspaper El Pais:
    “Two of the Cuban vaccines, ‘Soberana 02’ (Sovereign 02) and ‘Abdala’ are in their final trial phase. Mexico and Iran will probably take part on this final trial phase of the Cuban vaccine. According to Peruvian Jose Moya, who is PAHO (Pan American Health Organization) representative in Havana: ‘This is no miracle: there is an outstanding scientific development in Cuba and they have 30 years of experience making vaccines.’ He pointed out that the island was the first country in developing a vaccine against meningococcal disease, and in the early 90s Cuba produced a vaccine against Hepatitis B that has been widely used in Latin America and Africa.”

  9. Cuibono

    I can see the rationale for immunity from unforseen adverse events…
    but criminal negligence?

    can someone explain that? just because we can?

    1. MichaelSF

      If criminal negligence (and I think there was also a mention in the article of “malice”) are parts of the standard operating procedure, then that SOP no doubt includes seeing that they are safely excluded from being something for which the business will be liable.

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