J&J Gives Notice of Termination of Emerging Manufacturing Agreement for COVID Vaccine

June 6 (Reuters) – Johnson & Johnson (JNJ.N) said on Monday it had officially notified Emergent BioSolutions Inc (EBS.N) of its decision to end the agreement with the contract manufacturer to manufacture the COVID-19 vaccine for the drug maker.

The termination notice comes about a week after J&J initially notified Emergent of its intent to terminate the pact due to contract manufacturer defaults, including failure to supply the COVID-19 vaccine drug substance, said NOT A WORD.

Emergent said earlier Monday that J&J violated an agreement by not purchasing the minimum quantity of COVID-19 vaccines made by the company.

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The contract manufacturer added that J&J failed to provide the required forecast for the amount of vaccine it needed and terminated the deal instead of meeting the minimum requirements.

If the deal is terminated, Emergent said J&J would owe it about $125 million to $420 million.

J&J, in its statement, said Emergent’s filing was “false and misleading.”

“We have sufficient capacity across our global COVID-19 vaccine manufacturing network, and we continue to meet our contractual obligations to supply our vaccine,” J&J said.

Use of J&J’s COVID-19 vaccine was blocked in the United States after the Food and Drug Administration in May severely restricted its use due to safety concerns. Read more

J&J also withdrew its COVID-19 vaccine sales forecast for the year due to a supply glut driven by weak global demand. Read more

Manufacturing at the Emergent plant in Baltimore was briefly halted last year after it was discovered that ingredients in AstraZeneca’s (AZN.L) COVID-19 vaccine, also produced there at the time, contaminated a batch of vaccines from J&J.

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Reporting by Manas Mishra and Leroy Leo in Bengaluru; Editing by Amy Caren Daniel and Shinjini Ganguli

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