[2024] EWHC 1071 (TCC)

This is the pre-trial review in relation to the claim of the Secretary of State against the First Defendant, Primer Design, and he Second Defendant, Novacyt, which provided a guarantee in respect of the performance of a contract entered into between the Secretary of State and Primer Design on 28th September 2020. The contract was for the supply of 6,300 Exsig COVID-19 testing kits per week for an initial period of 14 weeks. With the supply of other equipment the total value of that contract was £175 million.

It is common ground that the contract contained the express terms of the so-called Limited Warranty. That warranty included a warranty that each reagent kit should be of good quality and free of material defects and function in accordance with the Specification. It is common ground that the Specification was version 1 of Primer Design's Exsig IFU (or Instructions for Use).

As originally pleaded, the Particulars of Claim alleged three breaches of contract and three breaches of the Specification relating to sensitivity of the testing, use with oropharyngeal specimens and use with PBS nasal swabs.

In November 2022, the Particulars of Claim was amended to add a further breach at paragraph 37(D) of the Particulars of Claim. That is in the following terms:

"It is averred that during TVG validation over half of the Exsig Kits reported a Cq number of more than 27. PD's IFU advised users to only use tests where IEC (Internal Extraction Control) Cq result is less than 27. The fact that over half of the apparent false negative results reported Cq numbers of more than 26 is further evidence that the assay was flawed and lacked robustness. This fact is further highlighted when the true negative results are also examined as large numbers of those results also returned an IEC Cq result of greater than 26. That a significant number of invalid results was noted across different sites demonstrates that the assay was flawed and not sufficiently robust for use. As such, it was in breach of the Specification as set out in paragraph 14 above, in that it did not perform to the standards reasonably to be expected of a laboratory based in vitro diagnostic device capable of detecting the SARS-CoV2 virus. Further or alternatively, for the same reasons, the Exsig was not of good quality nor free of material defects ...".

The paragraph went on to allege that public safety would have been imperilled by a large number of invalid test results.

As I understand it, and expressed it during the course of argument in layman's terms, the Internal Extraction Control, IEC, is a provision within the test kit to test for genetic material which is wholly unrelated to the Covid virus. If that is not identified within 26 cycles of the test, the test is considered invalid. The IFU at section 15 states that if the IEC is not detected, or is detected on the 27th cycle or later, this "indicates a compromised sample preparation and an invalid result".

The claimants infer from the number of invalid tests that there was a flaw in the reagent kits; that they were not sufficiently robust for use, that is that they failed to produce valid results at an acceptable rate; and that they did not, therefore, perform to the standards reasonably to be expected of a lab-based in vitro diagnostic device for the virus and were not of good quality. The claimants say that that is a breach of the warranty of good quality and/or the warranty in respect of performance in accordance with the Specification.

The first defendant, Primer Design, puts in issue, first of all, the construction of the warranty. In summary, and without in any way committing the defendants to this summary, Mr. Twigger KC submits that the warranty of good quality relates only to the condition of the reagent kits and not to their performance, or the performance of the Exsig kit as a whole, and that the warranty in respect of the specification is that the kits, or the elements of the kits, will perform in accordance with the Specification if the Instructions for Use are followed. He submits that the Instructions for Use are detailed and specific.

As to the case on robustness more generally, the defendants say that there is no contractual requirement of robustness which is itself a vague term. The IEC has been designed to detect a compromised sample and invalid result and, therefore, an "IEC failure" cannot evidence a flaw in the test kit. On the defendants’ case, it follows that the claimant needs to show why the rate of invalid test results was the product of a flaw in the kits themselves and not an external factor.

That is a high level summary of the dispute between the parties and a high level summary of the dispute that is relevant to the applications before me.