France to pay 16 pct for cancelled H1N1 doses-paper

PARIS, March 23 Tue Mar 23, 2010 7:52am EDT

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PARIS, March 23 (Reuters) - The French government will pay three swine flu vaccine makers 48 million euros ($65 million) for 358 million worth of H1N1 doses it cancelled, French newspaper Le Figaro reported on Tuesday.

The health ministry has concluded negotiations with Novartis (NOVN.VX) and notified GlaxoSmithKline (GSK) (GSK.L) and Sanofi Pasteur to each reimburse them 16 percent of the value of the order for 50 million doses, Le Figaro said, a deal that will hit GSK hardest.

A spokeswoman for the French health ministry had no comment on the unsourced article but said the matter would be discussed this afternoon in the French Senate, followed by a news conference at 1730 GMT.

Based on a 16 percent reimbursement fee, GSK would be paid 36 million euros rather than 224 million. Novartis has agreed it will get 10.5 million euros out of 65 million it was supposed to receive, Le Figaro said.

Sanofi Pasteur, the vaccine division of Sanofi-Aventis (SASY.PA), is still in negotations about the reimbursement, which would amount to 2 million euros instead of 12.5 million initially.

Sanofi Pasteur had proposed cancelling 9 million doses but the government later decided to drop another 2 million from the 28 million it had ordered from the company, a Sanofi Pasteur spokesman said..

"For now nothing has been finalised, but we are advancing," the spokesman said. "We have not received any new proposal."

Three months ago the French government began talks with the vaccine makers about reimbursement for cancelling 50 million of 94 million H1N1 doses it had ordered.

When placing the order, the government followed the World Health Organisation's (WHO) recommendation for two shots per person to prevent swine flu but in November the European Medicines Agency said one single dose would be sufficient.

The WHO declared swine flu a pandemic last June, sparking a race to develop new vaccines to fill demand from governments. However, many people have not taken the vaccine as the outbreak has turned out to be fairly mild. ($1=.7401 Euro) (Reporting by Caroline Jacobs; editing by Karen Foster)

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