The European Union and AstraZeneca have resolved their differences over the troubled delivery of Covid-19 vaccines, according to a European Commission statement.

As a result the Commission has dropped its legal action in the Belgian courts.

EU Commissioner for Health Stella Kyriakides said: "Today's settlement agreement guarantees the delivery of the remaining 200 million Covid-19 vaccine doses by AstraZeneca to the EU.

"While this week we reached the important milestone of 70% full vaccination of the EU's adult population, there are significant differences in vaccination rates between our Member States, and the continued availability of vaccines, including AstraZeneca's, remain crucial."

The deal means AstraZeneca is committed to delivering 135 million doses to the EU by the end of 2021.

This will be in addition to the 100 million doses already delivered by the end of the second quarter this year.

A further 65 million doses will be delivered by the end of March next year, meaning the contract for 300 million doses will have been fulfilled.

The EU and AstraZeneca were locked in an acrimonious dispute earlier this year over the company's poor delivery of vaccine doses, which allegedly hampered the opening phase of the EU’s vaccine roll out campaign.

EU officials accused AstraZeneca of prioritising UK vaccine deliveries over the EU order, and European Commission lawyers went to court to demand deliveries or see huge daily fines imposed for any ongoing shortfall.

But the firm argued that its contract with the bloc only obliged it to make "best efforts" to meet its delivery target, and that production bottlenecks in its European plants had been unavoidable.

In June, in an interim ruling pending the final settlement of the case, the Brussels court imposed a new delivery schedule on AstraZeneca that it was able to honour.

And now the parties have agreed dates that extend the deadline well into next year.

Ruud Dobber, executive vice president for biopharmaceuticals at AstraZeneca, said: "I'm very pleased that we have been able to reach a common understanding which allows us to move forward and work in collaboration with the European Commission to help overcome the pandemic."

AstraZeneca manufactures vaccines designed at Britain's Oxford University and sells them on a non-profit basis - its version is cheaper and easier to store than many competitors.

But the EU has become frustrated by the slow pace of supply and has made another vaccine produced by US giant Pfizer and Germany's BioNTech the workhorse of its buying programme.

Additional reporting AFP