Brazil suspends Covaxin contract to probe ‘irregularities’

Brazil has decided to suspend its contract of roughly $320 million to procure 20 million doses of Bharat Biotech’s Covaxin while it looks into allegations over irregularities in the deal, including the vaccine’s price of $15 per dose.

The decision comes several days after a whistleblower testified before a Senate panel looking into Brazil’s handling of the pandemic, and follows the recommendations of the country’s Comptroller General (CGU).

“By recommendation of @CGUonline, we decided to temporarily suspend the Covaxin contract. According to CGU’s preliminary analysis, there are no irregularities in the contract, but, due to compliance, the @minsaude (Brazilian health ministry) opted to suspend the contract for further analysis,” Brazil’s Health Minister, Marcelo Queiroga, tweeted Wednesday. “It is noteworthy that the @govbr did not pay ANY CENT for the Covaxin vaccine…”

Bharat Biotech on Wednesday claimed that Brazil’s procurement process of Covaxin has been “misrepresented.” In a statement, the Hyderabad vaccine-maker argued that it has “not received any advance payments nor supplied any vaccines to MOH Brazil.”

Brazil’s President Jair Bolsonaro has come under fire after the country’s contract for Covaxin became the centre of controversy over certain alleged irregularities. These, including an increase in the vaccine’s price, prompted the country’s Parliamentary Inquiry Committee (CPI) to open an investigation into the deal with Bharat Biotech.

Brazil’s Health Ministry head of imports, Luis Ricardo Miranda, and his brother, Congressman Luis Miranda, testified before the committee that they had warned Bolsonaro about suspicions surrounding the contract, according to a report by CNN Brazil. Members of this committee found that the price for Covaxin in the negotiated contract — $15 per dose — was much higher than what was initially quoted, according to the report.

Emails between Bharat Biotech and Brazil’s Health Ministry showed that the initial price quoted was $1.34 per dose, the CNN report said, citing a CPI statement.

Bharat Biotech, however, stated, “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.” It has received advance payments from “several” countries at these price points, it added.

Brazil’s federal prosecutors and lawmakers have also been probing why the country struck a speedy agreement with Bharat Biotech while ignoring offers by Pfizer at a lower price, according to a Reuters report on June 26.

Ricardo Miranda, the whistleblower, also told senators that he had been pressured by an aide to one of Bolsonaro’s close allies to approve an import licence for the vaccine. He had refused the approval because an invoice for up-front payment for the first shipment of Covaxin had been sent by Singapore-based Madison Biotech, which had not been mentioned in the contract, as per Reuters.

According to the Hyderabad-based company, Madison Biotech was founded by Bharat Biotech CMD Dr Krishna Ella in 2020 for “external R&D and sales and marketing of vaccines”.