KUALA LUMPUR: The terms in the agreement with Pfizer (Malaysia) were agreed on despite being unfavourable as the emergency procurement of Covid-19 vaccines was "a matter of life and death" says deputy health minister Lukanisman Awang Sauni.
Lukanisman (GPS-Sibuti) said countries entering an agreement with the vaccine makers including Pfizer had to sign a confidential disclosure agreement (CDA) and a binding term sheet (BTS) before the manufacturing and supply agreement (MSA) was inked.
He added that this also allowed the supplier to come up with terms which were enshrined by confidentiality.
“If the Malaysian government had not signed those documents, the early negotiations and information such as the content of active ingredients and initial findings of clinical trials would not have been made known to the government,” he said.
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Lukanisman noted that changes to procurement procedures had to be taken in line with the emergency situation at hand.
He was responding to a question by Hassan Abdul Karim (PH-Pasir Gudang) on why the contract was signed when it was found to have contained terms which were more in favour of the supplier.
“The Covid-19 procurement was literally a life and death issue,” he said while winding up the debate on the White Paper on Covid-19 Vaccine Procurement Management in the Dewan Rakyat on Monday (June 12).
Lukanisman said that the government made the decision to go ahead with the procurement of the Covid-19 contract even though the agreement was unfavourable for the government to protect the people of Malaysia from severe Covid-19 infection, complications that can lead to death and to ensure that 80% herd immunity is achieved immediately.
“The government made a policy decision to go ahead with the vaccine procurement agreement to expedite the procurement of Covid-19 vaccines as all lives were valuable,” he added.
He added that the Attorney-General’s Chambers (AGC) had flagged the irregularities in the draft agreement which were seen as being more in favour of the company.
“Although the government, upon the advice of the AGC realised that the agreement did not favour the government, it had to make a decision to continue the urgent procurement,” he added.
Other challenges faced in the procurement of the vaccines include the market being dominated by suppliers, where they were able to come up with terms which were more favourable for them.
On the delays in Malaysia’s procurement of the Pfizer-BioNTech vaccine compared to Singapore, he said Malaysia was the second country in the Asean region to receive the mRNA vaccine after the island republic.
He said Malaysia’s population was also six times larger than that of Singapore.
“Therefore, a more thorough analysis on procurement and the implementation of the National Covid-19 Immunisation Programme (PICK) had to be conducted,” he added.
The White Paper had revealed that after going through the draft agreement, the AGC and the legal advisor of the Health Ministry were of the view that the ministry had to review clauses related to policy, finance, technical procedures and specifications agreed in the agreement with Pfizer (Malaysia).
It then suggested on Dec 24, 2020, that necessary amendments should be made and the draft updated according to the government's terms before being submitted to the company.
However, Pfizer (Malaysia) said the format of the agreement is uniform for all countries entering into an agreement with Pfizer and the proposal to amend the terms cannot be considered.
It was said in the Paper that the AGC had reviewed and proposed the amendment proposals to the MSA draft to protect the government's interest.
The unfavourable clauses include the termination of the agreement.
"For example, if the agreement is ended by Pfizer (Malaysia) on the grounds of a breach by the government, the government will then have to pay the full price for the contracted doses to Pfizer (Malaysia) within 30 days (minus the sum that was already paid to the company)," it said.
On the contrary, no penalty will be imposed on Pfizer (Malaysia) if the government had ended the contract due to a breach by the company.
To this, the AGC had proposed an amendment, whereby if the agreement was terminated, the government would only be required to pay the "monies due and payable" as at the date of termination. However, the proposal was not considered by Pfizer.
