House of Representatives

House approves P500-M indemnification fund for COVID-19 vaccines

Mara Cepeda
House approves P500-M indemnification fund for COVID-19 vaccines

SIMULATION. Volunteers participate in the first simulation and training for the COVID-19 vaccination program at the University of Baguio Gym in Baguio City on February 15, 2021.

File photo by Mau Victa/Rappler

The arrival of COVID-19 vaccines in the Philippines is delayed due to the missing indemnification fund

The House of Representatives passed a bill setting a P500 million indemnification fund to shoulder the medical costs of Filipinos should they experience “adverse effects” after getting vaccinated for the coronavirus.

A total of 225 legislators voted yes to pass House Bill (HB) No. 8648 or the proposed COVID-19 Vaccination Program Act of 2021 on 3rd and final reading on Monday, February 22, 4 days after President Rodrigo Duterte certified the measure as urgent.

No lawmakers voted against the bill, while 6 abstained from the vote. 

Duterte certifying HB 8648 as urgent allowed lawmakers to do away with the 3-day mandatory interval between its 2nd and 3rd reading approvals.

If passed into law, HB 8648 would create a COVID-19 National Vaccine Indemnity Fund worth P500 million, which would augment the funds of the Philippine Health Insurance Corporation.

A claim for indemnification for serious adverse events must be filed within 5 years from the day of the person’s COVID-19 vaccination.

The indemnification fund would be sourced from the 2021 national budget’s Contingent Fund, which are lump-sum appropriations that the government can tapped to finance unforeseen expenses.

The bill states the indemnity would be valid and available for release until it is fully expended or if the President terminates the program.

HB 8648’s initial version did not contain a specific amount for the fund. But prior to the measure’s 2nd reading approval on Monday, the plenary agreed to substitute HB 8648 with a new version that contains several amendments to include the P500-million indemnification fund and where it would be sourced.

The House plenary tackled other measures on the floor before approving HB 8648 on 3rd and final reading on Monday.

The Philippine government is on a race to create this indemnification fund since it is among the requirements to gain COVID-19 vaccine doses from pharmaceutical companies and the COVAX global facility. 

Under indemnification programs, governments agree that distributing entities will not be held liable for unexpected adverse events. This is a risk governments absorb during the pandemic when granting emergency use approval for COVID-19 vaccines. 

Philippine pandemic officials initially announced that COVID-19 vaccines would already arrive by mid-February, but later on said delivery would be delayed due to a lack of an indemnification fund.

The Duterte government was supposedly informed of the indemnification requirement only during the latter phase of vaccine negotiations. 

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HB 8648 would also grant immunity to public officials and employees, contractors, volunteers, and private sector representatives – including vaccine manufacturers – from claims arising from the vaccine program. But they would not have any immunity if the claims would arise from “willful misconduct and gross negligence.”

The bill likewise creates a vaccine passport program to serve as a record of the COVID-19 vaccinations received by an individual.

The final version of HB 8648 approved by the House is now closer to the pending Senate version, but some provisions are still either conflicting or are missing from the other chamber’s version.

This means both houses would have to convene a bicameral conference committee to thresh out the conflicting provisions before the final version of the bill can be sent to Malacañang for Duterte’s signature. 

The House or the Senate may also opt to just adopt the version of the other chamber to skip the bicam level.

Fast-tracking vaccine purchase

Apart from creating an indemnification fund, HB 8648 also aims to help expedite the Duterte government’s COVID-19 vaccine procurement by exempting the process from public bidding and granting tax exemptions on the vaccines, supplies, and equipment to be procured.

The bill authorizes the Department of Health and the National Task Force Against COVID-19 (NTF) to engage in “negotiated procurement under emergency cases” for the COVID-19 vaccines.

Negotiated procurement would allow the DOH and the NTF to directly negotiate a contract with a capable supplier to speed up the process.

Local government units (LGUs) and private entities would also be allowed to buy COVID-19 vaccines or accept them as donations – but only by signing a multiparty agreement with the national government and the manufacturer concerned. This is the current policy being implemented by the NTF.

LGUs would only be allowed to purchase COVID-19 vaccines for up to 50% of their respective localities’ population. But the bill said the Inter-Agency Task Force on Emerging Infectious Diseases may adjust this cap when there are enough supplies available. This power granted to LGUs would be valid retroactively starting from January 1, 2021.

The bill also mandates private companies that would be procuring COVID-19 vaccines to administer them for the “sole and exclusive use of such companies.” This authority would apply retroactively starting November 1, 2020.

The bill likewise grants tax exemptions on the COVID-19 vaccines to be procured

It would also waive the Phase IV clinical trial requirement for COVID-19 medication and vaccines, but the drugs should still be recommended by the World Health Organization and/or other internationally recognized health agencies. 

Under the bill’s multiparty deal scheme, LGUs and private entities would only be allowed to purchase COVID-19 vaccines that have already been registered with the Food and Drug Administration (FDA) or have been issued emergency use authorization (EUA).

So far, only the vaccines created by Pfizer-BioNTech and AstraZeneca have secured EUAs from the FDA. 

If passed into law, the bill’s provisions would be valid during the state of calamity and public health emergency that was declared due to COVID-19 or until June 30, 2022 – unless Duterte lifts the state of emergency or extends it. – Rappler.com

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Mara Cepeda

Mara Cepeda specializes in stories about politics and local governance. She covers the Office of the Vice President, the Senate, and the Philippine opposition. She is a 2021 fellow of the Asia Journalism Fellowship and the Reham al-Farra Memorial Journalism Fellowship of the UN. Got tips? Email her at mara.cepeda@rappler.com or tweet @maracepeda.