Brazil Senate Inquiry Follows the Money in ‘Scandalous’ Covaxin Deal with India

By Shobhan Saxena and Florencia Costa – Jun 22, 2021

As Brazilian streets swell with anger against Bolsonaro, a parliamentary commission turns its focus on corruption in the government’s deal with Bharat Biotech for the most expensive vaccine which is yet to get approval from health regulators.

Sao Paulo: In November 2020, when Bharat Biotech offered to sell its indigenously-made COVID-19 vaccine – Covaxin – to Brazil with the possibility of technology transfer, it was showcased as India’s growing prowess. Eight months later, not a single dose of the vaccine has been given to anyone in Brazil.

Instead, the deal between the Indian company and Brazil’s ministry of health, brokered by a local firm, has become the main focus of the parliamentary commission of inquiry (CPI), which is investigating the handling of the pandemic by the government of President Jair Bolsonaro. Suspecting corruption in the deal, the senators are now treating it like a scandal as they sniff the money trail in the 1.6 billion reals ($300 million) contract for 20 million doses, the most expensive deal made by this country with each dose costing $15.

The parliamentary probe, which has already put Bolsonaro in a spot for promoting “preventive treatments” like hydroxychloroquine, is now focusing on why the president, who has repeatedly doubted the efficacy of vaccines like Pfizer and delayed their acquisition, pushed for a costly vaccine which was not even approved by the Brazilian drug regulator or the World Health Organisation.

On Sunday, a day after it was revealed that federal prosecutors were investigating if Precisa Medicamentos, the firm in the middle of the deal, was favoured by the government, Senator Renan Calheiros, the CPI rapporteur, said the commission would investigate all the “scandalous things” in the purchase of Covaxin. “It has drawn our attention because it is an unusual acquisition in all aspects. So, we will have a week to go deeper into everything that happened in the background,” said the senator.

Though Covaxin has made a lot of negative headlines in this country, this is the first time that a top politician has used the word “scandal” for the deal. As Senator Calheiros’s remarks came just days ahead of the Precisa Medicamentos’s chief appearing before the senate, it was a sign that the probe was ready to pin him down on the acquisition process and the payment.

The panel is already in possession of documents which show that the government aggressively pushed for a deal with Bharat Biotech. A report revealed on Saturday that a civil servant from the ministry of health had told federal prosecutors that he had suffered “unusual pressure” to guarantee the import of Covaxin. In a confidential testimony, obtained and published by Folha de Sao Paulo newspaper, the official has accused Lieutenant Colonel Alex Lial Marinho, a confidante of former health minister Eduardo Pazuello, of pressurising him.

Students protesting with banners that say “Life, bread, vaccine and education” at nationwide protests in Brazil on Saturday. Photo: UNE

The senate began to investigate the Bolsonaro government’s “acts of omission and commission” in handling the pandemic in April. But in the past few weeks, with explosive information emerging, the probe has changed tack. It is now looking into corruption in the deals for medicines and vaccines, with focus on the purchase of hydroxychloroquine and Covaxin. The money trail for both these deals lead to India.

According to sources in Brasilia, the probe will try to find out if some far-right groups close to Bolsonaro got a cut in the exorbitant deal with the Indian company. The parliamentary panel, says a source, has acquired documents which show that the company which facilitated the negotiation between Brazil and Bharat Biotech received 500 million reals ($100 million), one third of the total amount, for its services. Though the ministry of health has denied paying any money to the company as yet, the questioning of Francisco Maximiano, the managing partner of Precisa Medicamentos, on Wednesday (June 23) is expected to focus on the amount in addition to the company’s past record and its connections.

Call to Modi, again
Brazil’s plan to vaccinate its population against COVID-19 faltered from the beginning, primarily because Bolsonaro campaigned against vaccines and created hurdles in their acquisition from China and the US. But in January 2021, after Covaxin was approved for emergency use in India, some members of Congress floated the idea of buying it for private hospitals and businesses under the “exceptional importation” scheme. Bolsonaro put his full weight behind the idea by placing a call to Prime Minister Narendra Modi.

Senator Calheiros finds this whole arrangement quite suspicious. “It was the only acquisition for which the president [Bolsonaro] made a phone call to the prime minister of India [Modi]. It was an indication of the president’s preference despite all these problems (with the vaccine). And it was approved by the Chamber of Deputies as a bill that authorised the purchase of vaccines directly by businessmen. These are things that in all respects seem scandalous,” said the senator on Sunday.

This is the second time in as many weeks that the Indian prime minister’s name has been dragged into the parliamentary probe whose proceedings are being watched live by millions of Brazilians every day. As reported by The Wire, Bolsonaro had lobbied with Modi last year on behalf of two private firms for releasing the supply of hydroxychloroquine, a drug with no proven efficacy against COVID-19; in 2021, Bolsonaro again lobbied for a vaccine which had not been approved by the Brazilian Health Regulatory Agency (ANVISA) and yet cost more than any other vaccine in the world.

Senator Randolfe Rodrigues, the vice president of the senate commission, has raised serious questions about the president’s role in the Covaxin deal, especially because he had repeatedly declared that no vaccine could be bought without ANVISA’s approval. “Suddenly we discover that on January 8, Bolsonaro made another call to the prime minister of India asking for the vaccine from Bharat Biotech, Covaxin, which had not yet been registered with ANVISA. Then we found out that a company here in Brazil was marketing this vaccine and the representative of that company was in New Delhi on January 6. On January 8, Bolsonaro calls the prime minister of India showing an interest in buying this vaccine,” said Senator Rodrigues on Saturday, in a live chat on social media.

The parliamentary inquiry into the Covaxin deal has been playing non-stop on Brazilian TV channels.

Senator Rodrigues, who has been doggedly pursuing the chloroquine and Covaxin leads among others, said on Monday that the parliamentary probe was now entering the third and decisive phase. “After confirming the government’s negligence in purchasing vaccines and the existence of a parallel cabinet, which was responsible for the worsening of the pandemic, now the time has come to prove a collusion between public and private entities to profit financially from the fight against the pandemic,” said the senator on Monday.

This statement by the commission’s vice-president, just ahead of testimonies scheduled for this week, is a clear sign that Francisco Maximiano, the head of the company representing Bharat Biotech in Brazil, will face a lot of heat at the Senate hearing on Wednesday. With all his telecommunication data unlocked and made available to the senate panel, Maximiano can expect some very probing questions at the hearing which is broadcast live on television and closely followed on social media throughout Brazil.

A special relationship
In the free and universal vaccination programme in this country, there are currently three vaccines: CoronaVac, made by Butantan Institute of Sao Paulo in collaboration with Sinovac of China; AstraZeneca, made by Fiocruz Institute of Rio de Janeiro; and Pfizer, bought from the US company. All the three vaccines were given either definitive or emergency use authorisation by ANVISA after phase-3 trials in Brazil. Also, all the vaccines or their technology were directly purchased by the government agencies without any company – domestic or foreign – acting as a mediator.

Compared to the process followed by these vaccines, Covaxin seems to have been given a preferential treatment. In February 2021, when the Brazilian government announced the signing of the deal with Bharat Biotech, the Indian company had not conducted its phase-3 clinical trials in Brazil nor released the results of same trials in India. Besides, there was a private company in the middle selling the vaccine at a much higher price than other serums. The special treatment given to Covaxin, including its high cost, is now in the crosshairs of the parliamentary commission.

Though the Brazilian inquiry is only looking at what transpired in this country, the questions that will be thrown at Bharat Biotech’s representative on Wednesday could raise a few eyebrows in India, too, because of the discrepancies in statements made by the Brazilian government and the Indian company. The Brazilian federal government signed a contract for the purchase of 20 million doses of Covaxin from Precisa Medicamentos/Bharat Biotech on February 25, 2021. According to an official announcement on the ANVISA’s website, the Indian company was expected to deliver the first eight million doses in March, between 20 and 30 days after signing the contract, another eight million doses in April and the last batch of four million doses in May. But a statement issued by Bharat Biotech on February 26, 2021 said the delivery of doses to begin in only in April and probably go up to September. “The company is delighted to partner with Brazil in its battle against Covid-19 and aid its immunization programme against the virus. It has signed an agreement for delivery of Covaxin during Q2 and Q3 2021,” the company had said in a statement.

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Interestingly, on February 17, nine days before the contract was signed, Brazil’s then minister of health Pazuello had presented a schedule to make available 230 million doses of vaccines at a meeting with governors of Brazilian states. In the presentation, made even before the submission of all documents to ANVISA by Precisa Medicamnetos, the minister had announced the same schedule of Covaxin doses: eight million each in March and April and four million in May.

Not a dose single dose of the vaccine was delivered within 20 days of signing of the contract. On March 15, at a meeting with ANVISA officials, the Bharat Biotech representatives said they were “still gathering documents and technical information to formalise their request” to get the Indian vaccine through exceptional importation. But on March 31, ANVISA rejected the vaccine on the grounds of lacking good manufacturing practices and for not submitting the phase-3 trial results. Reacting to the ANVISA decision at that time, Bharat Biotech’s chairman Krishna Ella had claimed that the Brazilian regulator was driven by “nationalism” and a desire to keep the Indian vaccine out of the country.

Raging streets of Brazil
After a few days of extremely critical media coverage of the Indian vaccine following its rejection, the Covaxin story receded into the background as ordinary Brazilians struggled to get jabs in their arms. But since ANVISA allowed the import of four million doses of the Indian vaccine with strict conditions on June 4, the debate about Covaxin has been reignited, with many angrily questioning if the Bolsonaro government is still pushing this vaccine for motives other than its efficacy. The growing rage against Bolsonaro has been amplified by the contrast in the government’s attitude towards the much sought-after Pfizer and CoronaVac vaccines as compared to Covaxin. During the course of the senate hearings, it has been revealed that Bolsonaro ignored Pfizer’s proposal continuously while he was pushing for the Covaxin deal. According to Senator Rodrigues, a total of 101 emails sent to the Brazilian government by Pfizer were ignored and the company representative failed to meet any official after trying for six months. Asked about this at the CPI, Gen Pazuello said that it was not his “role to meet with company representatives”.

Rozana Barroso, president of a student organisation, protests with a model of a syringe with a slogan in support of SUS, the free and universal healthcare system of Brazil. Photo: UNE

The parliamentary commission was set up to find out the truth about the government’s handling of the pandemic. But the live broadcast of the proceedings, where ministers and officials have faltered miserably while reputed healthcare experts have exposed the serious flaws in the government’s policies, has sparked a widespread public anger. As Brazil continues to register more than 70,000 new infections and 2,000 deaths every day, people’s sorrow is turning into a rage. On Saturday (June 19), as the death toll due to COVID-19 crossed the half-a-million mark, more than 750,000 Brazilians came out on the streets of 500 cities and towns to protest against Bolsonaro.

In Sao Paulo, the financial capital of South America, the protesters, wearing masks and carrying banners and flags, spread over nine massive blocks on Avenida Paulista, the main avenue of the metropolis. This was the second massive protest in Brazil in three weeks. The mood in the country has changed as people demand answers from Bolsonaro. “Life, bread, vaccine and education,” read a banner displayed at most protest sites; “More mask and less chloroquine”, said another slogan; and another message blamed the government for hundreds of thousands of deaths: “To refuse vaccines is a genocide”.

With the organisers of protests, mostly student groups, workers’ unions, opposition parties and common Brazilians, promising to continue the protests in coming months, the political class in Brasilia has got the message from the street. Probably to give an assurance to the raging streets, seven out of 11 senators comprising the inquiry panel issued a strongly-worded statement on Saturday, promising to make those responsible for 500,000 deaths pay for their mistakes: “We ensure that those responsible will pay for their mistakes, omissions, contempt and debauchery. We did not reach this devastating, inhumane picture, by chance. There are culprits and they, as far as the CPI is concerned, will be punished in an exemplary manner. Before divine justice, they will meet with the justice of men.”

Lobbying for an expensive vaccine while denying others amid a deadly pandemic may prove to be a costly mistake for Brazil’s president.

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

Featured image: More than 1,00,000 people came out on the streets of Sao Paulo on June 19 to protest against the government of Jair Bolsonaro. Photo: UNE

(The Wire)