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Sinovac wants price kept secret; any disclosure and deal is off
The Chinese manufacturer of Sinovac vaccines, which Sri Lankan plans to procure in the millions, has placed a condition on its purchase contract: if the price of the jab is disclosed or even spoken about in public, the deal is off and there could be legal trouble.
“They [Sinovac Lifesciences Co. Ltd.] have said that if the price in the agreement is disclosed to the public or spoken about in public it will be subjected for termination of the agreement or they will take legal action against us,” V. Nadarajah, Chairman of Kelun Lifesciences (Pvt) Ltd, the local company that has a Memorandum of Understanding with the Chinese firm, writes in a June 13 letter to Prof Channa Jayasumana, Sri Lanka’s State Minister of Pharmaceutical Production.
Mr Nadrajah says this was because “…we are getting a very competitive price for Sri Lanka”. The official name of the vaccine is CoronaVac but it is commonly called the Sinovac COVID-19 vaccine. Sinovac Lifesciences is the Beijing-based unit of Sinovac Biomed that developed the jab.
But the subject of price has been sticky. A regional controversy recently broke out when it was found that the quoted price of the other Chinese vaccine, Sinopharm, was five US dollars more for Sri Lanka (US$ 15 a dose) than it was for Bangladesh (US$ 10 a dose).
At the time, the Chinese Embassy in Sri Lanka said through its verified Twitter account that it was “a common practice of different price range for all the phama [sic] companies and Sri Lanka gets a best corporate price with a fastest delivery”.
It also quoted the Chinese Embassy in Dhaka as saying Bangladesh’s procurement agreement including pricing was not finalised and called the price discrepancy reports “fake news on social media”. The inclusion of a non-price disclosure clause in Sri Lanka’s proposed contract with Sinovac Lifesciences has taken place against such a backdrop.
President Gotabaya Rajapaksa in his address to the nation on Friday said Sri Lanka hoped to vaccinate 13 million people by September. Kelun Lifesciences in a separate June 11 dated letter to Prof. Jayasumana said it was a “key condition” of Sinovac Lifesciences for a guaranteed purchase quantity–the minimum purchase order being 13 million vaccine doses.
Under the deal, Sri Lanka will enter into an agreement with Kelun Lifesciences to secure 13 million Sinovac doses which are set to be manufactured–that is, dispensed, filled, packaged and tested–at its site in Pallekele. It has sought confirmation from the State Ministry on how many doses of it should be produced for Sri Lanka.
It later conveys that payment for the first 3 million doses will have to be made in advance. For the 10 million doses, payment must be through “an irrevocable LC/Advance”. In an irrevocable letter of credit, the terms and conditions can neither be amended nor cancelled.
Kelun Lifesciences states that it is Sri Lanka’s first and only sterile liquid and infusion manufacturing facility. It has signed a non-disclosure agreement and a Memorandum of Understanding with Sinovac Lifesciences which is its vaccine bulk material supplier and technology partner. A business agreement is next to finalise the financial terms of the partnership.