AstraZeneca PLC (LON:AZN) has been sued by the EU Commission over COVID-19 vaccine deliveries, it has emerged.
All 27 states backed the legal challenge, which started last Friday.
READ: Netherlands won’t use millions AstraZeneca vaccine doses, Valneva seeks 4,000 UK volunteers for jab trials
The FTSE 100 pharma giant has been criticised by the bloc after cutting supplies below the levels indicated by initial contracts.
Earlier this year, it admitted it would supply 30mln doses to the EU instead of the promised 80mln in the first quarter of 2020, and only 70mln instead of the agreed 180mln in the following three months because of technical issues.
“Some terms of the contract have not been respected and the company has not been in a position to come up with a reliable strategy to ensure timely delivery of doses,” an EU spokesman was reported as saying by Reuters.
“We want to make sure there is a speedy delivery of a sufficient number of doses that European citizens are entitled to and which have been promised on the basis of the contract.”
The FTSE 100 firm said it "regrets" the bloc's decision to take legal action and noted that it is about to deliver almost 50mln doses to European countries by the end of April, in line with its forecast.
"AstraZeneca has fully complied with the Advance Purchase Agreement with the European Commission and will strongly defend itself in court. We believe any litigation is without merit and we welcome this opportunity to resolve this dispute as soon as possible," it said in a statement.
"We appreciate the work done by political leaders and healthcare professionals across the Member States that has made the rollout of vaccination campaigns in Europe possible, and we are committed to helping as much as we can."
"Vaccines are difficult to manufacture, as evidenced by the supply challenges several companies are facing in Europe and around the world. We are making progress addressing the technical challenges and our output is improving, but the production cycle of a vaccine is very long which means these improvements take time to result in increased finished vaccine doses."
According to analysts at IG, AstraZeneca is already "very unpopular" in the EU so the legal challenge may not make much difference there, while "it appears to have a good defence worked out already that will help maintain its image in other places such as the UK".
"Clearly however it will not want to risk antagonising EU governments too much given the importance of the EU for revenues," Chris Beauchamp, Chief Market Analyst at IG, told Proactive last week.
"One of the largest economies on the planet (taken as an EU whole) with high levels of wealth and healthcare spending, the EU will be a vital part of AZN’s business, so it does need to tread very carefully."
Shares were flat at 7,549.67p on Monday afternoon.
--Adds AstraZeneca's statement--