The UK Government has scrapped its agreement with the French pharmaceutical company, which has a major vaccine plant in Livingston, just months after increasing its order for doses by 40 million.
The cancellation comes amid allegations of a breach of the agreement, which Valneva says it “strenuously” denies.
Livingston MP Hannah Bardell said the announcement came out of the blue for Valneva, which is undergoing a major site expansion in Scotland.
It is understood the dispute could be connected to logistics and delivery schedules, linked to a shortage of manufacturing materials and HGV drivers due to Brexit. Building projects across the UK have been blighted by a shortage of building materials over recent months.
It was announced in August the vaccine agreement had led to the creation of 200 extra jobs at the Livingston site, potentially leaving them under threat as a result of the announcement.
Ms Bardell said she was writing to the UK Government to call for them to honour the deal with Valneva.
She said: “It is devastating and there are a lot of questions to be answered as to how this decision has been made. It seems to be a massive surprise and significant shock to the company. What message does that send to other companies which want to invest?”
Ms Bardell said the vaccine that Valneva was developing could be easily transported and stored, making it easy to use in countries which have not yet managed a widespread vaccine roll out programme.
She said: "I am going to press the UK Government. If this thwarts the creation of the vaccine, that would be a travesty. Hopefully the UK Government sees sense and Valneva still get the resource and the funding they were promised.”
The Scottish Government has reassured the public the booster shot roll-out planned for this winter will not be affected by the cancellation of the contract with Valneva.
Health secretary Humza Yousaf said the Scottish Government would work with the company to ensure the future of Valneva’s UK base in Livingston.
Around 100 million doses of the company’s vaccine, which is the only vaccine in trials which uses the whole virus in an inactivated, adjuvanted state, were put on order after the UK increased its request by 40 million in February. Valneva, which has around 700 employees worldwide, recently advertised for 200 new jobs at its Livingston plant.
The 100 million doses on order put Valneva at the top of the UK Government’s table in terms of vaccine supplies, alongside the Oxford-AstraZeneca jab.
Scottish Labour’s health and Covid recovery spokesperson Jackie Baillie said: “This decision raises a number of questions that need to be answered. Both the UK and the Scottish Government must provide assurances that the jobs at the Livingston plant manufacturing Valneva aren’t on the line, and that vaccine supplies will still be able to keep up with demand.”
In a statement, Valneva said: “Valneva has worked tirelessly and to its best efforts on the collaboration with HMG, including investing significant resources and effort to respond to HMG’s requests for variant-derived vaccines.
"Valneva continues to be committed to the development of VLA2001 and will increase its efforts with other potential customers to ensure that its inactivated vaccine can be used in the fight against the pandemic.”
A Scottish Government spokesperson said: “Valneva is a valued contributor to our life sciences sector and the Livingston facility is an important asset, supporting high-quality jobs.
"We will continue to engage with and support the company. We will also engage with the UK Government to seek its assurance that the facility will be supported in order to protect jobs.
“The contract and the decision to cancel it is a matter for the UK Government. The announcement does not affect the Scottish Government’s vaccination programme, which we continue to roll out as guided by advice from the JCVI, and we have sufficient vaccine supplies to undertake any potential booster programme over the coming months.”
Scottish Liberal Democrat health spokesperson Alex Cole-Hamilton said: "This is obviously a disappointing setback for the Livingston plant. People will be understandably curious as to the source of the dispute between Valneva and the UK Government, which has led to this contract being cancelled.
"Both the Scottish and UK governments will need to give reassurances that we have plentiful vaccine supply secured and whether this will have an impact on our international commitments in terms of supplying vaccines around the world."
The vaccine is in phase three clinical trials, but Valneva said it hoped it could be ready for approval by the end of this year.