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Taiwan can finally access BioNTech jabs in what might be the world’s most complicated vaccine deal

July 12, 2021, 9:04 AM UTC

On Monday, China’s Fosun Pharma announced that it will supply 10 million COVID-19 vaccine doses from German manufacturer BioNTech to Taiwan, breaking a monthslong political standoff between Taipei and Beijing that has prevented Taiwan from accessing one of the world’s most proven and effective jabs.

The 10 million doses will boost the lagging vaccine effort in Taiwan, where only 0.3% of the territory’s 24 million residents were fully vaccinated as of Monday.

To deliver the doses, Fosun Pharma, alongside some of Taiwan’s most prominent multinational corporations, have engineered what may be the world’s most complicated vaccine procurement deal. If Taiwanese authorities approve it, the arrangement may skirt longstanding geopolitical tensions between Taipei and Beijing that have delayed import of lifesaving vaccines to an island battling its worst-ever wave of COVID-19.

How the deal works

BioNTech will manufacture the 10 million doses in a factory in Germany for Fosun Pharma, which has distribution rights to BioNTech’s vaccine in mainland China, Macau, Hong Kong, and Taiwan.

Fosun Pharma will then sell the doses to Taiwan Semiconductor Manufacturing Co., the world’s largest chipmaker; Foxconn, the major Apple supplier and electronics manufacturer; and the Yonglin Charity Foundation, a nonprofit started by Foxconn founder Terry Gou.

Finally, Zuellig Pharma, a Singapore-based pharmaceutical firm that’s distributing Moderna’s COVID-19 vaccines in Taiwan and other parts of Asia, has agreed to deliver the doses from TSMC and Foxconn to the Taiwanese government. The deal inserts Zuellig, TSMC, Foxconn, and Yonglin as intermediaries, putting distance between the Taiwanese government and Fosun Pharma, a company whose mainland roots raised red flags in the territory.

In its press release, Fosun Pharma said the vaccines will arrive at an “early date” but did not specify a time frame. Taiwanese media outlets, however, report that the vaccine shipments may not arrive until September or October.

“We will work closely with our partners to provide safe and effective vaccines to Taiwan at an early date, safeguarding the lives and health of Taiwan compatriots, and helping their life [get] back on track as soon as possible,” Fosun Pharma CEO Wu Yifang said in a press release on Monday.  

Why it got so complicated

The deal works around a political stalemate that started in the early days of the pandemic.

On March 16 last year, Fosun Pharma agreed to invest $135 million in BioNTech to jointly develop and commercialize BioNTech’s mRNA vaccine in the Chinese market. (One day later, Pfizer purchased distribution rights to the vaccine in the rest of the world, excluding Germany.) The March joint press release stated that Fosun would have the rights to sell BioNTech’s vaccine “in China.”

But an Aug. 27 joint press release revealed that the two firms had agreed to an expansive definition of “Greater China” that included Hong Kong, Macau, and Taiwan.

The China-versus-Greater-China differentiation is important, since multinationals often grant mainland Chinese firms rights to Taiwan to win access to the expansive mainland China, but multinationals rarely get input from Taiwan before doing so.

The BioNTech–Fosun Pharma deal meant Taiwan had no choice but to rely on the mainland company for doses of BioNTech’s COVID-19 jabs. That proved problematic because Taiwan has a decades-long ban on importing Chinese-made vaccines. Fosun Pharma is currently importing German-made BioNTech doses to distribute in Hong Kong and Macau—not manufacturing the doses itself—but Taiwanese officials have said that buying vaccines from the mainland Chinese firm raises concerns about “security, efficacy, and legal issues.”

In early 2021, Taiwan’s government sought to negotiate directly with BioNTech for 5 million doses as a way to skirt Fosun Pharma’s distribution rights in Taiwan. The deal fell through in February, with both Taipei and Beijing blaming one another for its failure.

“Certain people don’t want Taiwan to be too happy,” Chen Shih-chung, Taiwan’s health minister, said in February, suggesting that Beijing or Fosun Pharma blocked the deal for political purposes. In response, Beijing accused Taiwan of violating “business rules and trust” and denied allegations that it blocked Taiwan’s BioNTech deal.

The stalemate and Taiwan’s record-breaking spike in COVID infections in May prompted Foxconn and TSMC, Taiwan-based firms with deep ties to the mainland, to seek the workaround Fosun Pharma announced on Monday. In June, Gou and TSMC executive chairman Mark Liu met with Taiwanese President Tsai Ing-wen, who gave the businessmen clearance to purchase the vaccines for Taiwan.

Taiwan’s government, meanwhile, did not return a request for comment on the deal.

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