Master Alliance Provisions Guide (MAPGuide)

Novavax– CEPI Outbreak Response to Novel Coronavirus (COVID-19) Funding Agreement

  • Access to medicines | Affordable or reasonable pricing
  • Access to medicines | Equitable access

14. Equitable Access

14.1. Commitment to Equitable Access. CEPI is committed to achieving equitable access to the results of all CEPI-supported programmes pursuant to the “Equitable Access Policy” referenced in CEPI’s Third Party Code. Equitable Access means that a Project Vaccine is available first to populations at risk when and where they are needed at affordable prices. For clarity, it is CEPI’s intention that the price of a Project Vaccine shall be commercially sustainable to the manufacturer.

14.2. Project Vaccine Registration. Awardee shall cooperate with CEPI, and at CEPI’s cost, take such actions as are mutually agreed to register Project Vaccines in countries identified as priorities. If Awardee is not the license holder for purposes of registration in a given country, then Awardee shall be responsible for ensuring that its Subawardee facilitate such registrations as requested by CEPI. Awardee shall utilize WHO pre-qualification or similar registrations systems to the extent available.

14.3. Global Allocation. It is the Parties’ expectation that a global allocation and purchasing entity (the “Global Allocation Body”) shall be constituted within six (6) months after the Effective Date of this Agreement to purchase, allocate, and direct the distribution of COVID-19 vaccines including Project Vaccine. Awardee, will negotiate, in good faith a separate agreement or purchase order to supply Project Vaccine as may be required by the Global Allocation Body in such agreement or purchase order to the Global Allocation Body during the Pandemic Period and after the Pandemic Period for LMICs. For the purposes of this paragraph “Pandemic Period” means the period of time between the date that WHO declared COVID-19 to be a PHEIC [Public Health Emergency of International Concern] (that is, 30 January 2020) and the date that WHO declares the PHEIC to have ended including any period of a COVID-19 pandemic re-emergence as declared by the WHO.

14.4. Pandemic Period Production and Supply. During the Pandemic Period, Awardee shall:

(a) produce Project Vaccine as described in the Work Package(s), if not greater; [“Work Package(s)” means a discrete set of activities in an iPDP [Integrated Product Development Plan].] 

(b) provide the JMAG [Joint Monitoring and Advisory Group] with a regularly updated [***] statement of its actual capacity and a forecast of its planned capacity for manufacturing of Project Vaccine;

(c) provide the JMAG with [***] advance written notice of each manufacturing run for the Project Vaccine;

(d) supply up to [***] of the quantity of the Project Vaccine produced for purchase by the Global Allocation Body pursuant to Clause 14.3 during the Pandemic Period. For clarity, Awardee may not allocate or obligate Project Vaccine doses to other third parties during the Pandemic Period that conflicts with its obligations under this Clause 14; and

(e) discuss in good faith with JMAG how to achieve its requirements for doses of Project Vaccine, including any potential increase in Awardee’s manufacturing capacity.

14.5. Post-Pandemic Period Production and Supply. After the Pandemic Period, Awardee shall continue to produce and supply Project Vaccine for purchase as required by the Global Allocation Body pursuant to Clause 14.3.

14.6. Pricing Objectives. The Parties acknowledge that the price of the Project Vaccine is critical to achieving Equitable Access during the Pandemic Period. Accordingly, Awardee agrees that its pricing shall be reasonable to achieve Equitable Access for populations in need of a Project Vaccine as well as an appropriate return on investment for vaccine manufacturers that make on-going supply commercially sustainable. The Parties acknowledge that the availability of pandemic insurance as described in Clause 17.7 shall be a relevant cost factor in Equitable Access. For clarity, the purchase of Project Vaccine by the Global Allocation Body or by any other purchasing agent(s) designated by CEPI shall be considered to have satisfied the pricing requirements for Equitable Access.

14.7. Costs and Sales. Consistent with the commitments in Clauses 14.4 to 14.6, Awardee shall:

(a) provide written [***] updates to the JMAG regarding its COGs for Project Vaccines and discuss relevant product development decisions that could affect COGs; and

(b) sell the Project Vaccine doses to the Global Allocation Body during and after the Pandemic Period pursuant to Clause 14.3.

14.8. Information about Production, Supply, Pricing and Sales. Upon written request by CEPI, Awardee shall provide reasonable information about its COGs, production, supply, pricing and sales of Project Vaccine sufficient to evaluate whether such activities meet the Equitable Access Policy.

14.9. Audit of Cost of Goods. No more than [***] and at CEPI’s reasonable cost, CEPI shall have the right to review or to designate an external auditor (which shall be an internationally recognized certified public accounting firm, not engaged on a contingent basis) to review Awardee’s financial records relevant to the information provided in Clause 14.8. Such audits will be conducted during normal operating hours in a manner to minimize disruption to Awardee’s business. In event that the audit concludes that the COGs and production, allocation, supply or pricing of Project Vaccine doses are not substantially in accordance with the achievement of Equitable Access as described in Clause 14.1, then Awardee shall: [***]. The provisions of this Clause 14.9 shall apply to any Sub-Grant Awardees and Trusted Collaborators.

14.10. Manufacturing in Multiple Countries. Awardee shall use [***] to establish operational manufacturing facilities in one or more geographically dispersed manufacturing sites as described in the Work Packages.

14.11. Equitable Access Plan. The foregoing commitments regarding Equitable Access shall constitute the “Equitable Access Plan.” This Equitable Access Plan shall be reviewed by JMAG no less than annually and shall take into account changes in COGs over time, production yield and volume and production economics. The Equitable Access Plan shall be regularly updated during the term of this Agreement.

14.12. Alternative to the Global Allocation Body. In the event that a Global Allocation Body is not constituted as expected by the Parties in Clause 14.3, then CEPI or its designated purchasing agent(s) shall have the rights attributed in this Clause 14 to the Global Allocation Body.

14.13. Loan Facility. CEPI shall fund certain of Awardee’s manufacturing related expenses, that may include reservation fees to secure future production capacity for the Project, certain acquisition fees to secure materials for the Project, and the like, each a “Loan Facility Payment,” as described in the iPDP (the Integrated Product Development Plan) and Budget, which Awardee may, in its sole discretion, elect to draw upon. CEPI, as lender, shall provide funds to Awardee, as borrower, as follows:

(a) CEPI hereby makes available to Awardee a term loan facility in an amount up to USD $142,500,000.00 (“Loan Amount”), which Loan Amount may be increased by mutual written agreement pursuant to Awardee’s request and CEPI’s acceptance of a loan request as described in subsection (d) below.

(b) Awardee shall apply the full amount of each tranche borrowed by it (each, a “Loan”) under this Clause 14.13 towards each such Loan Facility Payment.

(c) Awardee will request any Loan from CEPI hereunder generally no less than [***] prior to the proposed date of such Loan. For clarity, the advance of a Loan by CEPI for activities under any Work Package shall not be deemed as agreement by CEPI that any required Stage Gates have been achieved. [“Stage Gate” means a mutually agreed “go/no go” decision point to continue a given Work Package or to commence activities in another Work Package.]

(d) Loans shall be requested by Awardee on a loan request form provided by CEPI which shall require that Awardee:

(i) affirms that, as of the date of such request, Awardee is not in default or insolvent pursuant to Clause 19.2;

(ii) affirms that the representations and warranties made by Awardee in Clauses 16.1 and 16.2 remain true and correct;

(iii) sets out the amount of the requested Loan, with a supporting third-party agreement or invoice and other documentation reasonably requested by CEPI;

(iv) sets forth any reimbursement to CEPI for or credit offsets against any [***] of a prior Loan amount that was not applied to a Loan Facility Payment; and

(v) sets out a triggering event for repayment (“Repayment Trigger”) for each Loan Facility Payment. For clarity, the nominal Repayment Trigger is the date that Awardee receives an advance purchase commitment or other purchase of Project Vaccine pursuant to Clauses 14.3 to 14.5. The Repayment Trigger may be adjusted by mutual written agreement. In general it is understood that Awardee will undertake to repay each Loan (if such Loan has not otherwise been Discharged) at the time it receives payment for one or more purchases of the Project Vaccine related to such Loan, provided such payment covers Awardee’s actual COGs, not including the amount of the associated Loan, as further described in Clause 14.14.

Awardee’s failure to meet these requirements shall be grounds for CEPI to deny the advancement of any requested Loan, until such requirements are met.

14.14. Repayment and Discharge. Unless Discharged, each Loan shall be repaid on the date determined by its Repayment Trigger and when repaid by Awardee, will be acknowledged by CEPI as cancelled. Failure by Awardee to repay the Loans to CEPI as described in this Clause 14.14, shall be a material breach of this Agreement and CEPI shall be entitled to specific performance of this obligation. Generally, Awardee shall be released from repaying a Loan (“Discharged”) and such Loan shall be deemed a grant made by CEPI to Awardee when (i) Awardee demonstrates on or before the date determined by its Repayment Trigger of such Loan that Awardee was unable to utilize such reserved capacity or materials, as the case may be, or (ii) Awardee demonstrates that it was unable to secure one or more advanced purchase commitments or other purchases of the associated Project Vaccine and further demonstrates, to CEPI’s reasonable satisfaction, that there is no likely prospect for sale of such Project Vaccine or that Novavax is disposing of such Project Vaccine.

Repayment of Loans shall be made as follows:

(a) If (i) CEPI and Awardee agree to fully utilize reserved capacity from a Loan and (ii) Awardee obtains one or more advance purchase commitments or other purchases of the Project Vaccine produced pursuant to such reserved capacity, any such purchase proceeds that Awardee receives that are in excess of Awardee’s corresponding actual COGs, not including the amount of the associated Loan, shall be used to repay the Loan up to the full amount;

(b) If (i) CEPI and Awardee agree to partially utilize reserved capacity from a Loan and (ii) Awardee obtains one or more advance purchase commitments or other purchases of the Project Vaccine produced pursuant to such reserved capacity, in the interest of assuring Equitable Access to Project Vaccine, a pro-rated portion of the Loan related to the unused reserved capacity will be Discharged and any such purchase proceeds that Awardee receives that are in excess of Awardee’s corresponding actual COGs, not including the amount of the associated Loan, shall be used to repay the remaining portion of the Loan;

(c) If CEPI and Awardee agree not to utilize any reserved capacity from a Loan (whether or not CEPI utilizes the reserved capacity pursuant to Clause 14.16(a)), the entire amount of the Loan shall be Discharged;

(d) If against CEPI’s agreement, Awardee utilizes all or a portion of the reserved capacity from a Loan, Awardee shall repay the Loan in the full amount in [***] after Awardee starts utilizing the reserved capacity;

(e) For a Loan related to the purchase of materials, if Awardee obtains one or more advance purchase commitments or other purchases of the Project Vaccine produced using such material, any such purchase proceeds that Awardee receives that are in excess of Awardee’s corresponding actual COGs, not including the amount of the associated Loan, shall be used to repay the Loan up to the full amount; and

(f) Notwithstanding the previous, the Parties recognize that a variety of external factors, may impact repayment of a Loan and therefore agree to timely meet as requested by one Party and discuss a good faith adjustment to the repayment scenarios described herein.

14.15. Interest on Loans. No interest shall accrue or be payable on any Loan made under the Loan Facility.

14.16. Other Use of Reserved Capacity.

(a) If, as described in Clause 14.14(c), CEPI and Awardee agree not to utilize any reserved capacity from a Loan and the period of time for such reserved capacity is available, then CEPI shall have the right, but not an obligation, to use the reserved capacity for production of a designated third party product at its own cost but with the benefit of any unused credit recognized from the Loan Facility Payment, as provided by the underlying agreement with the entity with which such manufacturing capacity has been reserved.

(b) Awardee shall ensure that any contract with a relevant manufacturer to reserve and utilize reserved capacity secured by one or more Loan Facility Payment shall provide CEPI with the rights contemplated in the immediately preceding subsection (a); and shall provide copies of such contracts to CEPI in confidence. For clarity, Awardee shall have [***] after the Effective Date of this Agreement in which to secure such rights under any relevant third party contract already signed as of the Effective Date.