/ 21 April 2021

How South Africa’s Covid vaccine injury fund will work

Safrica Health Virus Vaccine
Scientists say the country needs to significantly improve vaccination rates (Emmanuel Croset/AFP)
South Africa has secured enough vaccine doses to vaccinate 46-million people against Covid-19, but the agreements to get shots into the country come with a catch.

To secure jabs, vaccine manufacturers require the government to exempt them at least partly from liability and potential lawsuits in the case of any severe side effects the shots may cause.

The solution? A no-fault compensation fund.

Research has shown these types of schemes can have tangible benefits such as fairly repaying people who are injured after they were vaccinated for the public good. They can also improve the public’s trust in vaccine programmes, found a 2020 study PLOS One study which analysed 23 schemes worldwide.

But the study also found that compensation schemes had some drawbacks, including that people have to wait for a long time before they are paid out and that many of these funds have strict rules when it comes to proving that a vaccine and a severe illness are linked.

Speaking to parliament on 14 April, Health Minister Zweli Mkhize said one of the conditions in the agreement with Johnson & Johnson — South Africa has secured 31-million of its doses — was that the regulations for the fund be published by 30 April. Mkhize said a similar condition had also been put forward by Pfizer, from which South Africa has procured 30-million doses.

On 15 April, the regulations for the Covid-19 Vaccine Injury Compensation Scheme were published for public comment. The document gave the public five days (until 19 April) to give their views on the funding scheme. This was a shorter period than normal because the Johnson & Johnson vaccines are expected to arrive this week.

One submission, from the Health Policy Initiative (HPI), criticised the regulations because they “contain minimal details and information on the specifics and cost of the proposed mechanism. This makes it difficult to comment on the mechanics of the fund, as mostly, it is still to be developed in the future,” the HPI argues. 

The organisation also pointed out that although the compensation scheme has funding implications, the regulations are vague about how the scheme will be funded, “what financial contribution the public or others will actually make” and “whether said vaccine manufacturers will contribute to the fund or whether they are given special exemption … potentially leaving the entire financial burden of maintaining the fund to the state and in turn the public”.

What exactly is this fund?

If someone is harmed as a result of their vaccination, they can submit a claim to this compensation scheme, which will then pay them for the injury sustained. Each claim will be assessed by a panel of experts who will determine if the injury was caused by the vaccine.

Common side-effects associated with Covid vaccines include pain at the injection site, fever, fatigue, headache, muscle pain, chills and diarrhoea. The fund is designed to cover more rare and severe occurrences. So far this list only includes severe allergic reactions, which are extremely uncommon. There are concerns about a possible link between the AstraZeneca vaccine and unusual blood clots, which is being listed as a rare side-effect in Europe but it’s still unclear if this is caused by the vaccine. Similar claims are also being investigated regarding the Johnson & Johnson jab.

The idea is that South Africa’s system will allow people to be financially compensated without having to go to court. If a person is not satisfied with their award from the fund, they can then choose to file a claim through the legal system.

Importantly though, the funding scheme protects anyone involved from taking responsibility for the injury — so there’s no blame assigned in the “no-fault” scheme and people cannot file a claim against the vaccine manufacturer or the government without having claimed from the fund first.

The exact amount of money in the fund is not entirely clear, but on Monday Business Day reported that R250-million would be allocated to the fund for the first year, based on the expectation that 800 to 2 000 successful claims would be paid out. Bhekisisa could not confirm this information.

Retired chief justice Sandile Ngcobo is in charge of overseeing the fund and ensuring all claims are dealt with fairly. He headed up the Competition Commission’s health market inquiry into the private health sector.

Why do we have the fund?

Internationally, the deals to get Covid-19 vaccines directly from pharmaceuticals include provisions that protect these companies from claims made against them for side-effects of their jabs, the treasury said.

The deal vaccine maker AstraZeneca signed with the European Commission, for example, gave companies partial immunity to claims made against them, according to a commission statement.

Until last week, the legal responsibility for vaccine injuries that occur in South Africa’s public and private sectors lay with the manufacturer that supplied the jabs. 

This no-fault compensation fund is the government’s response to having to take on some of the liability for potential serious adverse effects of the Covid-19 vaccines.

Worldwide, there are 25 no-fault compensation funds for vaccine injuries such as death, the 2020 PLOS One study found.

These funds usually cover a range of vaccines. South Africa’s fund is one of only two in the world that only covers injuries from Covid-19 vaccines. The other is the fund that the World Health Organisation (WHO) established for jabs secured through the international procurement mechanism, Covax. South Africa is not one of the 92 countries and territories that qualify to use the Covax facility because the country is too wealthy.

The specifics of deals made directly with pharmaceutical companies are not known because of strict secrecy rules, but the treasury says the health department has not signed any agreements that completely waive companies’ liability. The provisions do, however, require the government to provide “substantial” indemnity to claims that result from adverse effects”, the treasury says.

South Africa’s finance management laws don’t ordinarily allow for agreements that totally suspend indemnity for companies who enter into deals with the state. Exceptions can only be made if the minister involved (in this case the health minister) and finance minister both agree to it.

Who is eligible to access the fund?

The short answer: we don’t yet know who will qualify to get compensation from the fund.

We do know that you are entitled to submit a claim if:

●  The injury was caused by a Covid vaccine registered or approved by the South African Health Products Regulatory Authority (Sahpra);

●  The vaccine was procured and distributed by the government; and

●  You received the jab at a government-listed vaccination site.

The health and finance ministers are tasked with determining the finer details of who is eligible for compensation, which injuries and vaccines will be covered, the period of the injuries that the fund will cover and the procedures of applying to the fund.

The fund is meant to provide compensation for “severe injuries resulting in permanent or significant injury, serious harm to a person’s health, other damage or death”, provided that these injuries were caused by the vaccine.

A serious adverse response is defined as any condition caused by a medication that: requires being admitted to hospital, a prolonged period in hospital, causes persistent or significant disability, is a birth defect, is life-threatening or results in death, according to the Medicines and Related Substances Act.

All vaccine injury schemes cover vaccine injuries that result in disability, health damage or death, the PLOS One study found.

Sahpra provides oversight and regulates the quality, safety and efficacy of medicine and medical devices. It is responsible continuously monitoring the safety of medical interventions and reviewing reports of adverse reactions.

Sahpra recently reviewed reports of unusual blood clots in people who received the Johnson & Johnson Covid vaccine. This was part of checks and balances introduced along with Covid vaccines to continuously monitor the jabs for any rare or severe side effects. A simultaneous review is being conducted by the US Food and Drug Administration.

On Saturday, Sahpra recommended that the pause of the Sisonke study, through which the Johnson & Johnson vaccine is being rolled out to 500 000 health workers, should be lifted, provided that certain conditions are met, such as the “screening and monitoring of participants who are at high risk” of the rare type of blood clotting disorder associated with this vaccine. 

Such reviews are done to “assess the benefit-risk ratio of the medicines”, says Florah Matlala, who oversees pharmacovigilance at Sahpra. “Based on the outcomes of such assessments, different regulatory decisions are made, which include professional insert amendment, restricting access through prescribers or up-scheduling.”

Matlala says Sahpra’s role is more focused on ensuring the safety of the intervention and doesn’t extend to liability issues. Pharmaceutical liability cases must typically be dealt with through the consumer ombud and the legal system — something which the compensation fund minimises the need for.

Nicholas Crisp, the head of the health department’s National Health Insurance office, says the department’s team in the national immunisation safety expert committee, which is in charge of monitoring adverse events of vaccines, may eventually form part of the monitoring body for claims with the fund too.

How will the fund work?

The regulations published on 15 April leave the finer details of the fund’s management up to directives from the health department or committees it appoints.

The document gives the health department the right to decide whether to appoint a private company or a government entity to administer the fund.

It also gives people the options to approach the courts to sue a national or provincial government department, but only after applying for a claim with the fund. This is also the case for 65% of existing schemes globally, the PLOS One study found.

According to the regulations, people who are unhappy with the fund’s decisions can only go through the court system once an appeal to the fund is resolved. Vaccine manufacturers cannot be sued.

How much compensation will people who claim from the fund be entitled to?

If,  for example, South Africa bases its fund on the United States’s vaccine injury fund, Crisp says the payout for vaccine injuries will be a set rate that is calculated based on the degree of disability.

Claims for death as a result of a vaccine would then, in principle, be a once-off payment whereas an ongoing disability such as paraplegia might be paid out in monthly installments.

The specifics of the pay-out system in South Africa will still be determined. In the US the vaccine injury fund covers medical expenses, income lost as a result of a vaccine injury and a capped fee for pain and suffering. Lawyers can claim fees from the fund too, according to the US Health Resources and Services Administration’s (HRSA) website.

In the US, manufacturers pay 75 cents (about R10) excise tax on each dose of vaccines covered by the scheme, and this money is used to pay people who are awarded compensation, says the HRSA. This tax is calculated based on how many diseases each vaccine prevents. So, the MMR vaccine will be taxed $2.25 (R32) because it prevents measles, mumps and rubella.

Crisp says a body such as the South African Social Security Agency may be used to compensate people monthly, but the government is also considering other fund models, including private insurers. Only Finland and Sweden use private insurers to administer their vaccine injury schemes. 

The fund hinges on the Disaster Management Act, which is due to end in May, but ideally the fund could become a permanent feature that can mediate claims for all vaccine injuries in South Africa.

This story was produced by the Bhekisisa Centre for Health Journalism. Sign up for the newsletter.