Haven't received any payment from Brazilian health ministry: Bharat Biotech

Madison Biotech was founded by Krishna Ella in 2020 for external R&D, sales and marketing of vaccines

Amid a raging controversy in Brazil over the procurement of Covaxin, the Indian vaccine maker has clarified that it has not received any advance payment from the health ministry of that country.

As for Madison Biotech -- a Singapore-based company that has come under the scanner of the Brazilian prosecutors and lawmakers -- Bharat Biotech said it was a firm founded by its promoter Krishna Ella.

The controversy is around the price of Covaxin ($15 a dose), and the invoice of $45 million raised by Madison Biotech, whose name does not feature in the vaccine supply contract.

Bharat Biotech said the first meetings with the Brazilian health ministry happened in November 2020 and continued till June 29, 2021. “A step-by-step approach has been followed towards contracts, and regulatory approvals, during this eight-month-long process,” the company said. The emergency use authorisation (EUA) was received on June 4, it said.

“As of June 29, the company has not received any advance payment nor has it supplied any vaccines to Brazil’s health ministry,” it said in a statement on Wednesday.

Elaborating the procurement process for Covid-19 vaccines by several countries, the Hyderabad-based firm said the amount is paid in advance. Once a country indicates its interest to buy vaccines through a letter of intent or a memorandum of understanding, the vaccine maker proceeds to seek an EUA from that country’s regulator. The procurement happens after the EUA. The country’s health department then releases a firm purchase order indicating the volumes to be procured, it said.

“In order to secure a firm purchase order from the country, the company proceeds to raise a pro forma invoice to the MOH (ministry of health) towards the supply of vaccine. Based on the invoice, the MOH pays the amount in advance,” Bharat Biotech said. Once the payment is received, the company proceeds to supply the agreed quantities and within the agreed timelines, it added.

“Bharat Biotech has followed a similar approach towards contracts, regulatory approvals, and supplies in several countries worldwide, where Covaxin is being supplied successfully,” it said.

The company claimed that the pricing of Covaxin had been established between $15 and $20 per dose for supplies to governments outside India. “The pricing for Brazil has also been indicated at $15 per dose. Bharat Biotech has received advance payments from several other countries at the above price points, with supplies in process, pending approvals,” it said.

Meanwhile, the controversy in Brazil is around Madison Biotech raising an invoice and not Precisa Medicamentos, Bharat Biotech’s partner in Brazil.

Bharat Biotech said Precisa Medicamentos is Bharat Biotech’s partner in Brazil, providing assistance, guidance and support with regulatory submissions, licensure, distribution, insurance, conduct of phase III clinical trials, etc. “Bharat Biotech follows a similar partnership model in all countries, where its vaccines are supplied, as it does not have its own offices in these countries,” it added.

It did not elaborate on why Madison Biotech raised the invoice and not Presica Medicamentos or Bharat Biotech India.

Bharat Biotech and Precisa Medicamentos are conducting a 5,000- subject phase III clinical trial in Brazil, which was recently approved by ANVISA, the Brazilian regulator.

The company, however, said Krishna Ella, founder of Bharat Biotech, had also founded or acquired 13 other organizations, including Madison Biotech, which he founded in 2020 for the purpose of external R&D and sales and marketing of vaccines. “More than 3,000 personnel are employed in six cities across all these organisations. We wish to dispel any notion or implication of any wrongdoing whatsoever, as all these are affiliate companies founded or acquired and operated by Dr Krishna Ella,” the company said.