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Brazil Scraps Covaxin Application for Authorisation as Former Partner Attacks Bharat Biotech

Bharat Biotech's application for EUA approval has been binned and permission for clinical trials suspended.
File photo of Prime Minister Narendra Modi at the Bharat Biotech plant in November 2020.

São Paulo: Indian pharmaceutical giant Bharat Biotech’s ambitious plans to sell millions of doses of its highly-priced vaccine, Covaxin, to Brazil all but crashed on Saturday after the National Health Surveillance Agency (ANVISA) decided to scrap the company’s application for emergency use authorisation (EUA).

In a unanimous decision, the executive board of the Brazilian regulator declared that the application will no longer be evaluated. The decision, just a day after the Indian company announced the cancellation of its Memorandum of Understanding (MoU) with Precisa Medicamentos of Brazil, has now set the stage for termination of the $300-million deal for the supply of 20 million doses of Covaxin from India to Brazil.

As the scandal unfolds, the spat between the two former partners has turned into an ugly brawl.

On Friday, after Bharat Biotech dropped the Brazilian firm, the health regulator suspended the phase 3 trials of Covaxin in Brazil. As Precisa Medicamentos has done all the paper work, including the signing of a contract with the ministry of health, on behalf of the Indian company, the ANVISA move was very much on the cards. Casting her vote at the ANVISA meeting on Saturday, Meiruze Freitas, the rapporteur of the process, said that because of “the interruption of the commercial relationship between the companies” going ahead with a technical evaluation of a “petition would imply a significant waste of the administration’s efforts and resources.”

Also read: Knives Are Out as Bharat Biotech Dumps its Brazilian, Dubai Partners in Covaxin Deal

In a clear sign that the relationship between the Indian firm and its Brazilian partner had reached a breaking point, Bharat Biotech sent a mail directly to ANVISA on Friday, informing the regulator that Precisa Medicamentos “is no longer authorized to represent” it in Brazil. But Bharat Biotech had also claimed that it “would continue working with ANVISA to obtain the necessary approvals for the use of Covaxin in the country”. That this claim was exaggerated became clear immediately as the health regulator announced on Friday that it was reassessing the applications for two processes – EUA approval and clinical trials in Brazil. “ANVISA will reassess the processes underway at the agency and take necessary steps,” the regulator said to The Wire on Friday.

As of today, Bharat Biotech doesn’t have a representative in Brazil; its application for EUA approval has been binned and permission for clinical trials suspended. The permission, granted by ANVISA on June 4, 2021, for the import of four million doses of Covaxin exists but it has little value as it was based on emergency use authorisation and the results of phase 3 trials. The multi-million-dollar contract, which is a target of four different investigations and a focus of the ongoing parliamentary commission of inquiry (CPI) for corruption, too is just a piece of paper whose termination is imminent, probably within days.

Theoretically, Bharat Biotech can find a new partner and make fresh applications to ANVISA. But the Indian company might have weakened its case by making claims which have not gone down well here. As reported by The Wire, a day after Brazil suspended its contract on June 29, Bharat Biotech had claimed that its vaccine had emergency use authorisation in Brazil. After the claim was denied by ANVISA in a response to a question from The Wire, the company changed their statement to say that it had only received permission for exceptional importation. But on July 3, in another statement, the company repeated the already-discredited claim. “COVAXIN has now received emergency use authorisations in 16 countries including, Brazil, India, Philippines, Iran etc…,” said the firm in a declaration which carried the logos of Bharat Biotech and the Indian Council of Medical Research. It is still on the company’s website.

An open war  

As Bharat Biotech doesn’t have an office in Brazil, all its paper work was done by Precisa Medicamentos with whom the company first signed an MoU on November 24, 2020 and then a contract on January 12, 2021.

The MoU also included a third company called Envixia Pharmaceuticals which is registered in a free-trade zone area of the United Arab Emirates. As reported by The Wire, the Dubai firm’s name and its role in the Covaxin negotiations has come up for questioning during testimony at the Senate probe into the vaccine deal. On July 14, at her Senate appearance, the executive director of Precisa Medicamentos had described Envixia as a “broker” of Bharat Biotech.

On Friday, as the Indian company dumped their Brazilian representative along with the Dubai partner, it accused the Sao Paulo-based firm of fabricating two documents which gave it power of attorney with “broad powers to represent the Indian company” and speak for it “when the contract was signed”. Both the documents, published by O Globo on Friday, were submitted to the ministry of health by the Brazilian company whose scandal-plagued history has haunted it during the course of investigations.

But the decision by Bharat Biotech to cut loose its Brazilian partner was not only an indication of a loss of trust between the two firms but a sign that they were turning on each other as the Senate investigation threatens to singe their top honchos. On Saturday, Precisa Medicamentos went into full-attack mode as it not only challenged the Indian company’s allegation but also claimed that documents in question were sent to Brazil by Envixia Pharmaceuticals.

Also read: India-Brazil Chamber of Commerce on Senate Radar as CovaxinGate Probe Goes Beyond Brazil

In a sign of how the fast-deteriorating relationship between the two companies – both in the crosshairs of investigators – was not limited to a war of words, the lawyers of Precisa Medicamentos on Friday evening sent a report to the Federal Police, the Comptroller General of the Union and the CPI president alleging that the document identified as fraudulent was created by an employee of Envixia, which is a “partner of Bharat Biotech in international negotiations”. The exact details of the document submitted by the company were not immediately available but according to some reports it contains a forensic analysis of the two letters.

Both the letters, seen by The Wire, have been signed by Dr Krishna Mohan Vadrevu as executive director of Bharat Biotech. The signature is exactly the same as that of V. Krishna Mohan, who signed the MoU, also seen by The Wire, as the “whole-time director” of Bharat Biotech. There are some glaring spelling mistakes in the text printed on the official letter head of the company, but the Indian firm has alleged that entire document was forged by their Brazilian representative. Now, by submitting their own version to the Senate panel and the police the Brazilian company seems to be preparing a line of defence in which an employee of Envixia, which it constantly refers to as a partner of Bharat Biotech, is the real culprit.

With the investigators hot on their heels, the two companies are now blaming each other for the scandal that may have serious ramifications for their business as well as for politics in the country. While Bharat Biotech has launched a frontal attack on its former Brazilian partner, Precisa Medicamentos is firing back at them through Envixia, an elusive company about which little is known.

Speaking to The Wire, an executive of Precisa Medicamentos indicated that they might leak more damaging information about Envixia in coming days. “Most of the documents we received in the period between our accreditation as an official representative and the signing of the contract, including some documents that we even forwarded to ANVISA, came to us from Envixia,” said the executive, claiming that the UAE-registered company made unreasonable demands on them. “We warned Bharat Biotech, telling them what their partner was doing but they always left it to be resolved later,” said the executive.

With an open war between two companies, fireworks can be expected in the next 10 days before the Senate panel returns to the chamber of inquiry on August 3.

Shobhan Saxena and Florencia Costa are independent journalists based in Sao Paulo, Brazil. 

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