- Russia's Covid shot is proving alluring to its friends in Eastern Europe, creating another potential rift in the EU.
- The EU continues to struggle with the lethargic rollout of coronavirus vaccines across the 27 member bloc.
- Hungary, the Czech Republic, Slovakia and Austria have all expressed an interest in procuring and deploying Russia's "Sputnik V" vaccine.
As the European Union struggles to ramp up its rollout of coronavirus vaccines across the 27 member bloc, Russia's Covid shot is proving alluring to its friends in Eastern Europe, creating another potential rift in the region.
The Czech Republic, Austria, Hungary and Slovakia have all expressed interest in procuring and deploying Russia's "Sputnik V" vaccine, a move that could undermine an EU-wide approach to approving and administering coronavirus vaccines.
Czech Prime Minister Andrej Babis said on Sunday that his country could use the Sputnik V vaccine even without approval by the EU's drugs agency, the European Medicines Agency.
It comes after Russian President Vladimir Putin and Austrian Chancellor Sebastian Kurz had a phone call last Friday in which they discussed "possible supplies of the Russian Sputnik V vaccine to Austria, as well as its possible joint production," the Kremlin said, noting that Austria had initiated the call. Austria has so far indicated it would not bypass the EMA in terms of approving the vaccine, however.
Hungary, a country within the EU that has fraught relations with Brussels and whose leader, Viktor Orban, is seen as a close ally of Putin, has shown no such hesitation. It became the first European country to authorize in January — bypassing the EMA — and purchase the Sputnik V vaccine.
The country reportedly expects 2 million doses of the Sputnik V vaccine to be supplied over the next three months, according to the Moscow Times. Hungary also approved China's Sinopharm vaccine last month, again going against the grain when it comes to EU vaccine approval.
On Monday, Slovakia became the second European country to announce it had purchased the Sputnik V vaccine, securing 2 million doses of the shot. Slovakia's health minister said it won't be administered immediately, however, because it still requires the greenlight from the country's national drug regulator.
The pivot towards Russia's vaccine comes amid widespread frustration at the slow speed of the EU's vaccination rollout. It's been hampered by the bloc's decision to purchase vaccines jointly, and its orders came later than other countries including the U.K. and U.S.
Production issues and bureaucracy — and for some countries, vaccine hesitancy — have also been stumbling blocks to the rollout.
Nonetheless, the move by some Eastern European countries to endorse Russia's vaccine unilaterally is bound to raise the hackles in Brussels as it undermines the EU's wish for a unified approach, and a sense of equity over the distribution of vaccines.
There have also been concerns about Sputnik V specifically, although subsequent data has backed up the vaccine's effectiveness and credibility.
The vaccine was approved by Russia's health regulator in August last year before clinical trials were concluded, prompting skepticism among experts that it might not meet strict safety and efficacy standards. Some experts argued that the Kremlin was eager to claim victory in the race to develop a Covid vaccine.
However, interim analysis of phase 3 clinical trials of the shot, involving 20,000 participants and published in the peer-reviewed medical journal The Lancet in early February, found that the vaccine was 91.6% effective against symptomatic Covid-19 infection.
In an accompanying article in the Lancet, Ian Jones, a professor of virology at the University of Reading, England, noted that "the development of the Sputnik V vaccine has been criticized for unseemly haste. But the outcome reported here is clear and the scientific principle of vaccination is demonstrated, which means another vaccine can now join the fight to reduce the incidence of Covid-19."
However, the Gamaleya National Center of Epidemiology and Microbiology in Moscow, which developed the vaccine, has not yet submitted an application to the EMA for marketing authorization of the vaccine, the EU drugs agency said in early February.
RDIF, Russia's sovereign wealth fund that has supported the development of Sputnik V, indicated to CNBC on Monday that it had applied in mid-February to the EU drugs agency for a rolling review of the vaccine. The EMA has not confirmed this, however, and CNBC has reached out to the EMA for comment.
The European Commission has already warned Hungary, albeit indirectly, against the use of Russia's vaccine before the EMA has approved it. Back in November, a Commission spokesman told Reuters that "the question arises whether a member state would want to administer to its citizens a vaccine that has not been reviewed by EMA," adding that public confidence in vaccination could be damaged.
"This is where the authorization process and vaccine confidence meet. If our citizens start questioning the safety of a vaccine, should it not have gone through rigorous scientific assessment to prove its safety and efficacy, it will be much harder to vaccinate a sufficient proportion of the population," the spokesman said, Reuters reported.
Hungary's decision to go it alone when it comes to the Sputnik V vaccine is not surprising to EU watchers, however. The country's right-wing leader, Viktor Orban — of the "strongman" sort similar to Russia's Putin — has had several disputes with the EU executive in recent years, particularly over signs of the government's increasing authoritarianism. The erosion of judicial independence and freedom of the press in Hungary is of particular concern to the EU. Hungary's government rejects such criticism, however.
Gustav Gressel, senior policy fellow at the European Council on Foreign Relations, told CNBC Monday that Hungary's actions were "part of Orban's campaign to propagate a 'decadent, declining EU' and Hungary's future in the East, with Russia and China," a trend he said had been ongoing for some time.
Meanwhile, Daragh McDowell, head of Europe and principal Russia analyst at Verisk Maplecroft, described the geopolitics around Sputnik V and the EU as "political theater more than anything else."
"For Hungary and Austria there is an element of foreign policy signaling involved here, as both Kurz and Orban have generally had a closer relationship with Putin than their European peers. In the case of the Czech Republic the impetus seems to have been more to demonstrate that the government is 'doing something' in the face of a rapid rise in case numbers in February," he said.
There are also doubts as to whether Russia has the ability to mass produce and deliver its Sputnik V vaccine to Europe on a larger scale.
"While the Sputnik vaccine seems to be an effective vaccine in principle, Russia has great difficulties getting the mass production right ... there is still not enough Sputnik vaccine (being) produced," Gressel said. McDowell noted that "the issue is whether Sputnik V can make a noticeable difference given regulatory issues and existing logistical problems, and whether the vaccine can be produced in sufficient numbers either by Russian producers or under licence."