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Comment by ucha | Hacker News Reader

In 7.1., when they say the EU will provide funding at an amount equal to the "cost of goods", does it mean that AZ doesn't make profits on the vaccine they sell to the EU?

There is also a mention of a cost of good estimate and how if the cost of good was off by more than 20%, the EU should pay the difference...

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Right, AZ is doing all of this at cost for everyone, not just the EU (until the end of the Pandemic); I feel sorry for AZ having to take this hastle when they're not making anything out of it.

Don't they get their manufacturing facilities upgraded for free?

No there’s a section (redacted) that you can see in the toc. The costs don’t include factory upgrades.

At least they are getting paid. Pharmaceuticals generally lose money on vaccines. A big problem is many governments have historically reneged on their advance purchasing agreements when the viruses are not as bad as anticipated.

They will be be getting partially funded from the UK government solely on the virtue of the manufacturing centers being in the UK.

>does it mean that AZ doesn't make profits on the vaccine they sell to the EU?

During the pandemic period, which is defined to expire on 1 July 2021. A stupid contractual provision to include, since it creates monetary incentives to delay delivery.

(Not saying that's why this is happening. But if I were negotiating something like this, I'd include a bonus for early deliveries. It keeps interests aligned, and gives the supplier ammunition with which to add redundancies.)

Pretty sure that's a standard part of any agreement AZ made, since Oxford University only licensed the vaccine to them if they provided it at cost.

I believe the "no profit" clause comes from Oxford Uni who own the IP.

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