Axed Covid vaccine contract cost taxpayers £358m

The UK Government pulled out of the deal with French firm Valneva in 2021.

Valneva had its contract to manufacture more than 100 million Covid vaccines cancelled by the UK Government in 2021 (PA) (PA Wire)

A biotechnology company which had its contract to make Covid vaccines cancelled by the UK Government still received £358 million of taxpayers’ money, it has emerged.

French firm Valneva was supposed to manufacture more than 100 million vaccines at its site in Livingston, West Lothian, but the contract was axed by ministers in 2021.

The Government said it pulled out of the deal at the time because the company had breached the terms of the agreement, but this was denied by Valneva.

A financial statement published online shows Valneva received hundreds of millions of pounds in payments despite the deal being cancelled.

A form filed with the United States Securities and Exchange Commission states Valneva received advances totalling £358 million as part of its agreement with the UK Government.

It shows the company received around £40.5 million under a settlement agreement, another £66.5 million to cover capital expenditure, and the remainder related to prepayments for vaccine doses.

Valneva is now also reportedly considering selling the Almeida plant that was specially built at the Livingston site to manufacture the Covid vaccines.

It was reported this week by the BBC that the French firm has hired a commercial real estate firm to explore options for the mothballed 75,000sq ft facility.

A spokesperson for Valneva said: “Valneva is exploring options for its Almeida manufacturing facility in Livingston, initially built to produce its Covid-19 vaccine, including a possible sale or a re-purposing to produce its vaccine for Japanese encephalitis, and its chikungunya vaccine, if approved.”

The UK Government has been approached for comment.