Clifford Chance

Clifford Chance Badea wins important litigation case for Pfizer Romania related to the public acquisition procedure of 13-valent pneumococcal conjugate vaccine

The litigation practice of Clifford Chance Badea has secured a very important favorable decision for global client Pfizer in relation with the claim of a pharmaceutical company concerning the Romanian Ministry of Health's public acquisition procedure of 13-valent pneumococcal conjugate vaccine.

In August last year, the Ministry of Health finalized the awarding procedure for the 13-valent pneumococcal conjugate vaccine, subsequently signing a 4-year framework agreement with Pfizer Romania.

The plaintiff has challenged both the legality of the public acquisition procedure, and the validity of the agreement signed with Pfizer Romania. After a first procedural cycle, in October the Bucharest Court of Appeal annulled the awarding procedure. Pfizer Romania was not granted the right to present its point of view. The company's petition to intervene in favor of the Ministry of Health was rejected as inadmissible and the court did not analyze whether Pfizer had an effective possibility of acknowledging the existence of the challenge lodged with the National Council for Solving Complaints ("NCSC") in order to intervene in due time. Following the annulment of the awarding procedure, in November the Bucharest Tribunal annulled the framework agreement, thus reducing its performance term to 31 December 2018 and limiting the previsioned purchases by 75%.

The Clifford Chance Badea team led by Simona Neagu, lead counsel and coordinator of the Litigation and Dispute Resolution practice, obtained an overhaul of the Court of Appeals' decision, thus leading to the resuming of the entire process, this time with the participation of Pfizer Romania. After taking into consideration arguments from both pharmaceutical companies, the Court eventually decided that the public acquisition process had been legal. After acknowledging the legality of the awarding procedure, in the litigation concerning the framework agreement the Bucharest Court of Appeal upheld Pfizer Romania's appeal, quashed the Bucharest Tribunal's ruling and rejected the applicant's claim as lacking in interest, thus maintaining the framework agreement. Lawyers Sorin Toma and Călin Dragoman were part of the Clifford Chance Badea team.

"Procedurally, the Court's solution is important because it is one of the few situations when a Court reversed its initial decision on grounds of violation of the European Union Law Priority principle. This is special grounds for reversing a decision as stipulated at art. 21 paragraph (2) of the Law on administrative litigation. Rejecting Pfizer's intervention as inadmissible without any prior verification of Pfizer's effective possibility to acknowledge the existence of the challenge lodged with NCSC infringes the right to an effective review procedure available to any person having or having had an interest in obtaining a particular public procurement contract, as this right is enshrined in the Directive 89/665/EEC. Maintaining the framework agreement was the natural consequence of the fact that the legality of the awarding procedure was subsequently established with the force of res judicata between the two pharmaceutical companies and the Ministry of Health," counsel Simona Neagu said.

"Proving the legality of the negotiated procedure without prior publication in such a specialized sector involved a detailed analysis of the distinctive elements of the two vaccines, so as to provide the Court with the best understanding of the limits within which it may censure decisions to implement sanitary-immunological policies. The rulings issued during this litigation provide relevant references for interpreting and implementing the provisions of art. 104 of Law 98/2016, as well as for establishing the link between the legality of the awarding procedure and the valid conclusion of the public procurement contract," Sorin Toma added.

The Litigation practice of Clifford Chance Badea consists of 8 senior lawyers working alongside their colleagues from the other practices. The team is also fully integrated into the global litigation and arbitration network of Clifford Chance, being involved in global and complex commercial litigation, restructuring and insolvency, international arbitration, white collar crime and crisis management cases, as well as competition law investigations.