1. Regulatory Framework
1.1 Please list and describe the principal legislative and regulatory bodies that apply to and/or regulate pharmaceuticals, medical devices, supplements, over-the-counter products, and cosmetics.
In the EU, medicinal products, medical devices, food supplements and cosmetics are governed by distinctive legislative frameworks.
Medicinal products are primarily governed by Directive 2001/83 on the Community Code relating to medicinal products for human use ("Community Code"), related national implementing legislation of EU Member States and Regulation 726/2004 on the authorisation and supervision of medicinal products and establishing a European Medicines Agency ("EMA Regulation"). These legislations establish the key concepts related to medicinal products and the marketing authorisation procedures for placing medicinal products on the market.
Additional legislation is applicable to specific types of medicinal products such as Regulation 1901/2006 on medicinal products for paediatric use, Regulation 141/2000 on orphan medicinal products and Regulation 1394/2007 on advanced therapy medicinal products.
The EMA and the European Commission are the primary regulatory authorities at EU level in charge of medicinal products, alongside the national competent authorities of EU Member States.
Medical devices are governed by Regulation 2017/745 on medical devices ("MDR") and Regulation 2017/746 on in vitro diagnostic medical devices ("IVDR"). The MDR entered into application on 26 May 2021 and the IVDR on 26 May 2022, repealing and replacing Directive 92/42 on medical devices, Directive 98/79 on in vitro diagnostic medical devices and Directive 90/835 on implantable medical devices.
Manufacturers of medical devices must undertake a conformity assessment of their products prior to being able to affix the CE mark permitting them to place their devices on the EU market. Apart from devices presenting the lowest category of risk (Class I medical devices and Class A IVDs), conformity assessments require the intervention of a Notified Body. The Notified Body issues a CE Certificate of Conformity following successful completion of a conformity assessment procedure. However, enforcement and supervision of devices on the EU market is carried out by the national competent authorities of EU Member States.
Food supplements are governed by the general EU rules applicable to food, including Regulation 178/2002 laying down the general principles and requirements of food law, establishing the European Food Safety Authority ("EFSA") and laying down procedures in matters of food safety, as well as Regulation 2269/2011 on the provision of food information to consumers. Specific requirements regarding food supplements are established in Directive 2002/46.
Additional requirements and restrictions may further be established in the national legislation of EU Member States, such as restrictions and requirements for the use of certain substances other than vitamins or minerals, the allowed levels of vitamins and minerals or registration requirements.
The EFSA and the European Commission are the primary EU regulatory authorities in charge of food supplements alongside the national competent authorities of EU Member States.
Cosmetics are governed by Regulation 1223/2009 on cosmetic products and regulated by the national competent authorities of EU Member States.
1.2 How do regulations/legislation impact liability for injuries suffered as a result of product use, or other liability arising out of the marketing and sale of the product? Does approval of a product by the regulators provide any protection from liability?
The main legislation governing product liability at EU level is Directive 85/374/EEC concerning the liability for defective products (the Product Liability Directive or "PLD"). The PLD establishes an EU-wide strict liability regime for defective products, which has been implemented under the national laws of EU Member States. In addition to the PLD, claimants may rely on provisions of national laws, including in tort (negligence) or contract law, to bring claims for defective products. Claims under the PLD are usually preferred because claimants do not have to establish fault, but instead only that:
- the product was defective;
- the claimant suffered damage; and
- there was a causal link between the defect and the damage suffered.
Regulatory compliance and approval or certification do not provide a complete defence to a product liability claim. On the other hand, regulatory non-compliance is not sufficient in itself to establish defect. However, the applicable regulatory regime is likely to be relevant in nearly all product liability claims in relation to medicinal products and medical devices, including as follows:
- The test for defect is that a product did not provide the level of safety that persons generally are entitled to expect, taking all circumstances into account. Regulations and industry standards may be relevant evidence in determining the appropriate level of safety. By extension, compliance with regulations may be a relevant circumstance for the purposes of assessing whether or not there was a defect.
- Non-compliance with the applicable regulatory regime may lead to field safety action, which increases the risk of product liability claims. Moreover, the existence of field safety action may be a relevant circumstance in determining defect.
- Breach of regulatory regimes can give rise to a risk of regulatory enforcement, which may include criminal liability under national product safety laws.
1.3 What other general impact does the regulation of life sciences products have on litigation involving such products?
The regulations governing life sciences products are likely to be relevant in determining whether a product is defective in the context of a product liability claim. More generally, as life sciences products are highly regulated, litigation involving such products tends to be more complex and costly. It usually requires a greater breadth of expert evidence and takes longer to proceed through the courts.
1.4 Are there any self-regulatory bodies that govern drugs, medical devices, supplements, OTC products, or cosmetics in the jurisdiction? How do their codes of conduct or other guidelines affect litigation and liability?
There are many self-regulatory bodies relating to life sciences products at EU level, and at the national level within EU Member States. Self-regulatory bodies often take the form of industry associations such as the European Federation of Pharmaceutical Industries, MedTech Europe which represents medical technology industries including medical devices and IVDs, Cosmetics Europe and Food Supplements Europe.
Many industry associations draw up individual codes of conducts and guidelines. The rules are generally applicable to members of the association, but they may also have a broader reach and be recognised as industry-best practices.
Similar to applicable regulations, codes of conduct or other guidelines from such bodies are likely to be relevant evidence in determining the appropriate level of safety in product liability claims and a relevant circumstance for the purposes of assessing whether or not there was a defect.
1.5 Are life sciences companies required to provide warnings of the risks of their products directly to the consumer, or to the prescribing physician (i.e., learned intermediary), and how do such requirements affect litigation concerning the product?
Life sciences companies are required to provide information permitting intended users of their products to correctly and safely use products placed on the EU market, in accordance with their intended purpose. This information may therefore include any precautions and warnings related to the use of a product.
The regulatory frameworks governing life sciences products each establish specific requirements regarding the information that must accompany a product and be provided to users. The related requirements govern the information, and present a variety of supports, accompanying life sciences products, including for example labels, packaging, instructions for use or patient leaflets. This information may be provided directly to consumers or to the prescribing physician, depending on the intended user of the products.
Compliance with the appropriate labelling and information requirements for a given product, including the provision of warnings and precautions, will be relevant in the context of any litigation concerning a product. The importance of the warning will depend on the nature of the claim and the damage suffered. In the context of a product liability claim under the PLD, the following elements may be considered:
- Warnings provided with the product will be taken into account for the purposes of assessing whether or not a product is defective. As noted above, the test for defect is that a product did not provide the level of safety that persons are generally entitled to expect, "taking all circumstances into account". The presentation of the product is one of the circumstances specifically identified in Article 6(1)(a) of the PLD, and is interpreted to include warnings that accompany a product. Where relevant warnings are provided, this does not, however, automatically alleviate liability, but it will form part of the assessment of whether the product provided the appropriate level of safety.
- Inadequate warnings can of themselves found a claim in product liability on the basis of an allegation of a warning defect, or a failure to warn. The adequacy of warnings is assessed at the point in time each product is put into circulation. Over the lifetime of a medicinal product or medical device type, the content of the required warnings is likely to change as understanding of the risks of the product evolves.
- Assuming the end user receives the warnings, they will be
relevant in the assessment of defect for a product liability claim
regardless of whether they were given directly or through a learned
intermediary. In practice, however, there may be greater
difficulties evidencing that an end user received the warnings
where they were given through a learned intermediary.
2.1 What are the local licensing requirements for life sciences manufacturers?
Life sciences companies seeking to place a medicinal product on the EU market must obtain a marketing authorisation. To obtain authorisation to market a medicinal product in the EU, an applicant must submit a marketing authorisation application ("MAA") either (i) in accordance with a centralised procedure administered by the EMA followed by a related legally binding decision by the European Commission, or (ii) one of the procedures administered by competent authorities in EU Member States (decentralised procedure, mutual recognition procedure, or national procedure). A marketing authorisation may be granted only to an applicant established in the EU.
The manufacture and supply of medicinal products in the EU are subject to Good Manufacturing Practice ("GMP") and Good Distribution Practice ("GDP"). Manufacturers must obtain GMP manufacturing or import authorisation ("MIA") from the national competent authority of the EU Member State where their facilities are located or from the national competent authority of the EU Member State into which the product is first imported from a third country. Although an MIA granted by the competent authority of an EU Member State applies only to a single facility, products supplied from this facility may be provided to any country within the EU. When applying for a marketing authorisation, applicants must include the MIA of the facilities that will be relied upon to manufacture the medicinal product.
Manufacturers may be subject to additional obligations regarding licenses that are imposed by the national laws of EU Member States. Such obligations can relate to environmental permits, labour law and permits related to worker safety and permits concerning the handling of dangerous substances or genetically modified organisms.
Medical devices are governed by the MDR, the IVDR and relevant related guidance documents. Manufacturers must ensure that their medical devices comply with the General Safety and Performance Requirements ("GSPRs") set out in Annex I of the MDR or Annex I of the IVDR. Compliance with these requirements is a prerequisite to be able to affix the CE Mark to devices, without which they cannot be marketed or sold in the EU. To demonstrate compliance with the GSPRs provided in the MDR and the IVDR, and obtain the right to affix the CE Mark, medical devices manufacturers must undergo a conformity assessment procedure, which may vary according to the type of medical device and its classification.
2.2 What agreements do local regulators have with foreign regulators (e.g., with the U.S. Food and Drug Administration or the European Medicines Agency) that relate to the inspection and approval of manufacturing facilities?
The EU has concluded agreements regarding the mutual recognition ("MRA") of GMP inspections and batch certification of medicinal products with seven countries: Australia; Canada; Israel; Japan; New Zealand; Switzerland; and the USA. The scope of these MRA varies between countries. Companies wishing to rely on an MRA must investigate the exact scope of the MRA on which they wish to rely.
Following the exit of the UK from the EU, the EU and the UK concluded the EU-UK Trade and Cooperation Agreement ("TCA"). In accordance with the TCA, the EU and the UK recognise the outcomes of GMP inspections carried out by the other party in their territories, and may also recognise the outcomes of inspections carried out in other third countries.
There is no explicit mutual recognition of medical device manufacturing activities between the EU and third countries. However, to demonstrate conformity of medical devices with the requirements of the MDR or the IVDR, medical device manufacturers may rely on European Harmonised Standards, which are generally based on International Standards, such as EN ISO 13485:2016 on quality management systems. Recognition of test certificates and reports, such as through the ILAC Mutual Recognition Arrangement, can also be helpful to limit barriers and duplication. In addition, companies placing medical devices on multiple markets may wish to reduce related costs by relying on a Notified Body that offers a Medical Device Single Audit Program ("MDSAP"). While the EU does not participate in the MDSAP, the MDSAP procedure may still be helpful for limiting duplication in the EU. For example, a positive MDSAP quality management system conformity appraisal could be used to reduce the focus on aspects already covered by MDSAP audit reports for surveillance. Manufacturers should carefully plan the related strategy in collaboration with their Notified Body.
Following the UK's exit from the EU, Great Britain ("GB") has unilaterally decided to allow EU-compliant devices on the GB market until 30 June 2024. The EU does not, however, allow UK-compliant devices on the EU market.
Following the failure of the negotiations between the EU and Switzerland to extend the existing EU-Swiss MRA to the MDR and the IVDR, Switzerland has unilaterally decided to permit medical devices demonstrated to be compliant with MDR and IVDR to be placed on the Swiss market. The EU has not, however, agreed the same flexibility for devices that are demonstrated to be compliant with Swiss law.
The negotiations between the EU and Australia to extend the scope of the MRA to the MDR and IVDR is work in progress. For the time being, there is no related mutual recognition.
2.3 What is the impact of manufacturing requirements or violations thereof on liability and litigation?
Marketing authorisation for a medicinal product in the EU will only be granted if compliance with applicable requirements is demonstrated and a related certificate is provided by the competent national authority of an EU Member State. Non-compliance with any related requirements may lead to enforcement actions by the competent authorities, to potential litigation with competitors and potentially to claims for damages from aggrieved parties such as consumers.
Enforcement actions by the competent authorities of individual EU Member States may include inspections, orders to halt production, orders to issue warnings to users, products recalls, suspension or amplification of a marketing authorisation, withdrawal of a marketing authorisation and fines.
Manufacturers of medical devices placed on the market in the EU
may face actions by the competent authority of the individual EU
Member States if questions arise concerning the validity of their
CE Certificate of Conformity or shortcomings in the related
conformity assessment process. In addition, non-compliance with
applicable regulatory requirements may lead to the suspension,
variation or withdrawal of CE Certificates of Conformity by
Notified Bodies and potential litigation by competitors, customers
and consumers in case.
3.1 Please identify and describe any approvals required from local regulators for life sciences mergers/acquisitions.
Like all mergers, acquisitions, and joint ventures, life sciences deals may be subject to mandatory review by competition authorities under merger control laws. In the EU, an acquisition may, for example, fall within the jurisdiction of the European Commission or one or more of the national competition authorities of EU Member States. Consequently, as part of transaction planning, it is important to determine whether a contemplated transaction satisfies the relevant jurisdictional tests and is subject to merger review. Generally, such transactions must not be completed unless and until they are approved by the competent authorities. Transactions may be approved, prohibited, or approved subject to the parties' satisfaction of specified conditions. Risks of prohibition or conditional approval arise if any reviewing authority determines that the transaction will likely impede competition under the relevant substantive standards.
In addition, companies involved in life sciences deals resulting in a change of ownership should ensure that all applicable and required regulatory approvals or certifications relating to their operations or products will be held by the appropriate entity once the transaction is consumed. In relation to medicinal products, for example, companies may be required to transfer marketing authorisations or clinical trial authorisations. Moreover, if a transaction leads to substantial changes in relation to a product, such as a change of contract manufacturer impacting the quality management system of a product, new approvals or certifications may be required to be able to continue to place the related product on the EU market.
3.2 What, if any, restrictions does the jurisdiction place on foreign ownership of life sciences companies or manufacturing facilities? How do such restrictions affect liability for injuries caused by use of a life sciences product?
The foreign investment and foreign subsidies regulations place restrictions on foreign ownership, including of life sciences companies or manufacturing facilities, in certain circumstances. These regulatory frameworks are not concerned with questions of liability for injuries caused by the use of a life sciences product.
By way of example, within the EU, a life sciences transaction may satisfy the requirements for foreign investment review under one or more of the national laws of EU Member States. As from July 2023, the European Commission will have the power to review mergers, acquisitions, and joint ventures in relation to which the parties have benefited from certain forms of foreign subsidies.
As with merger review, it is important to determine whether a
contemplated transaction satisfies the relevant jurisdictional
tests and is subject to foreign investment or foreign subsidies
review. Generally, such transactions must not be completed unless
and until they are approved by the competent authorities.
Transactions may be approved, prohibited, or approved subject to
the parties' satisfaction of specified conditions. Risks of
prohibition or conditional approval arise if any reviewing
authority determines that the transaction is likely to operate
against the national security interests under the relevant law(s)
on foreign investment control, or distort the EU's internal
market under foreign subsidies regulation.
4. Advertising, Promotion and Sales
4.1 Please identify and describe the principal legislation and regulations, and any regulatory bodies, that govern the advertising, promotion and sale of drugs and medical devices, and other life sciences products.
The advertising and promotion of life sciences products are subject to both EU and EU Member States' laws governing the promotion of the respective type of product. At EU level, the advertising and promotion of life sciences products must comply with general requirements established in Directive 2006/114/EC concerning misleading and comparative advertising, Directive 2005/29/EC on unfair commercial practices, and specific requirements established in the applicable EU product legislation. Although general advertising and promotion requirements relating to medicinal products and medical devices are established under EU legislation, details are governed by regulations in individual EU Member States and can differ from one country to another. EU Member States may, for example, restrict or impose limitations on life sciences companies' ability to advertise their products directly to the general public or impose specific requirements relating to online advertising. Voluntary and national codes of conduct relating to advertising and promotion, as well as interactions with healthcare professionals, may provide further guidelines and limitations.
4.2 What restrictions are there on the promotion of drugs and medical devices for indications or uses that have not been approved by the governing regulatory authority ("off-label promotion")?
Applicable laws require that promotional materials and advertising in relation to medicinal products comply with the product's Summary of Product Characteristics ("SmPC"), as approved by the competent authorities in connection with a marketing authorisation. The SmPC is the document that provides information to physicians concerning the safe and effective use of the product. Promotional activity that does not comply with the SmPC is considered off-label and is prohibited in the EU.
Similarly, it is prohibited to communicate information relating to a medical device that may mislead the user or the patient regarding the device's intended purposes, safety and performance. This could arise through any of the following:
- ascribing functions and properties to the device which the device does not have;
- creating a false impression regarding treatment or diagnosis, functions or properties which the device does not have;
- failing to inform the user or the patient of a likely risk associated with the use of the device in line with its intended purpose; and
- suggesting uses for the device other than those stated to form part of the intended purpose for which the conformity assessment was carried out.
As a result, medical devices may, similarly to medicinal products, only be promoted in accordance with the intended use and indication for which they have been CE marked. Any promotional activity that does not comply with the properties for which a device has been CE marked is considered off-label and would be prohibited in the EU.
4.3 What is the impact of the regulation of the advertising, promotion and sale of drugs and medical devices on litigation concerning life sciences products?
Non-compliance with the applicable rules governing the advertising and promotion of medicinal products and medical devices may found a claim for judicial action. Inadequate warnings, for example, can of themselves found a claim in product liability on the basis of an allegation of a warning defect, or a failure to warn. The adequacy of warnings is assessed at the point in time each product is put into circulation. Over the lifetime of a medicinal product or medical device type, the content of the required warnings is likely to change as understanding of the risks of the product evolves.
Litigation relating to advertising and promotional activities
generally involves competitors rather than consumers or patients.
Although proceedings may lead to follow-on claims from consumers,
consumer claims relating to advertising and promotional activities
are not typically the focus of litigation concerning life sciences
5. Data Privacy
5.1 How do life sciences companies that distribute their products globally comply with data privacy standards such as GDPR and other similar standards?
Life sciences companies subject to the GDPR must establish a GDPR compliance framework. This requires an organisation-wide effort.
To set up a GDPR compliance framework, life sciences companies must map their personal data flows from A to Z to determine which GDPR requirements are applicable to them and when. Subsequently, life sciences companies should adopt internal policies or standard operating procedures to ensure that they can comply with relevant obligations in the GDPR in a timely and appropriate manner. Further, life sciences companies must adopt external facing documents such as privacy notices for data subjects and business partners.
5.2 What rules govern the confidentiality of documents produced in litigation? What, if any, restrictions are there on a company's ability to maintain the confidentiality of documents and information produced in litigation?
Procedural rules governing the confidentiality of commercially confidential information, IP, know-how, trade secrets and commercial confidents are governed by the national rules of the individual EU Member States. In this context, related restrictions must be assessed on a national level. Please refer to the individual country chapters.
EU legislation on access to documents governs access by third parties to documents held by individual EU institutions and agencies. Where these documents were provided by third parties, their content may be redacted to exclude access to commercially confidential information.
5.3 What are the key regulatory considerations and developments in Digital Health and their impact, if any, on litigation?
As part of an EU strategy to regulate artificial intelligence ("AI"), the European Commission has proposed a novel regulatory framework to govern AI. The proposed framework is composed of a Regulation laying down harmonised rules on AI (the "AI Act") and a Directive adapting non-contractual civil liability rules to AI (the "AILD").
In light of the growing use of AI components in medical technology, the current proposal for the AI Act has given rise to discussions relating to the co-existence of this AI Act with the existing legislative framework governing medical devices in the EU. In particular, the MedTech industry has raised concerns of potential misalignment and duplication of provisions between the AI Act and the MDR or IVDR. In accordance with the risk-classification system of the proposed AI Act, most medical device software would be classified as a high-risk AI system. Manufacturers of medical device software could be required to undergo certification procedures and comply with post-market surveillance requirements in accordance with the requirements of the AI Act and those of the MDR or IVDR.
These circumstances may increase the complexity of placing medical devices software on the EU market, as well as the related administrative and financial burden. However, potential impacts of the regulation of AI in the EU on the MedTech industry or the attractiveness of the EU market will depend to some extent on the final version of the AI Act that is adopted.
The proposed AILD, alongside the proposed reforms to the PLD and
upcoming new rules on representative actions in the EU, are set to
significantly change the liability risks for all product
manufacturers and suppliers who place products incorporating AI
systems onto the EU market. The proposed AILD will bring broad
rights for potential claimants, in many cases, to require companies
to disclose documents. It will also, generally, lead to increased
exposure in litigation (especially class actions) for companies
deploying AI, where obligations under the AI Act or other laws have
not been complied with.
6. Clinical Trials and Compassionate Use Programmes
6.1 Please identify and describe the regulatory standards, guidelines, or rules that govern how clinical testing is conducted in the jurisdiction, and their impact on litigation involving injuries associated with the use of the product.
In the EU, clinical trials are governed by the Clinical Trials Regulation (EU) No 536/2014, ("CTR"), which entered into application on January 31, 2022, repealing and replacing the former Clinical Trials Directive 2001/20 ("CTD"), and related national legislation of EU Member States. The legislative framework is supplemented by multiple EU and national guidance documents.
The CTR is intended to harmonise and streamline clinical trial authorisations, simplify adverse-event reporting procedures, improve the supervision of clinical trials and increase their transparency. Specifically, the CTR introduces a streamlined application procedure through a single-entry point (the "EU portal"), the Clinical Trials Information System ("CTIS"), a single set of documents to be prepared and submitted for the application, as well as simplified reporting procedures for clinical trial sponsors. A harmonised procedure for the assessment of applications for clinical trials has been introduced, and is divided into two parts. Part I assessment is led by the competent authorities of a reference EU Member State selected by the trial sponsor, and relates to clinical trial aspects that are considered to be scientifically harmonised across EU Member States. This assessment is then submitted to the competent authorities of all concerned Member States in which the trial is to be conducted for their review. Part II is assessed individually by the competent authorities and Ethics Committees in each concerned EU Member State, and focuses on the assessment of country-specific aspects relating to the recruitment of subjects, data protection requirements, format, and content of the informed consent, and other aspects of a regulatory nature.
The CTR requires EU Member States to ensure that systems for compensation for any damage suffered by a patient resulting from their participation in a clinical trial conducted on their territory are in place. Accordingly, sponsors of clinical trials are generally required to take out mandatory insurance, a guarantee, or equivalent arrangements that are appropriate given the nature and extent of the risks posed by the clinical trial. Clinical trial participants must be specifically informed regarding the applicable system in place for compensating damages resulting from their participation in a clinical trial as part of the provision of their informed consent to participate.
6.2 Does the jurisdiction recognise liability for failure to test in certain patient populations (e.g., can a company be found negligent for failure to test in a particular patient population)?
Life sciences companies must conduct clinical studies on a patient population that is representative of the population their product is intended for. Not all medicinal products or medical devices are intended for all categories of the population. In addition, in certain circumstances, reaching sufficiently representative numbers of certain categories of the population may be challenging due to local demographics, the characteristics of a disease or treatment being investigated or for ethical reasons. Provided the selected patient population in which clinical studies will be conducted is justified and that any exclusions of categories of the population are not discriminatory, life sciences companies may conduct clinical studies in limited categories of the population.
The absence of clinical studies relating to certain categories of patients will likely result in a limitation of the product's indication to exclude patients for which the safety and efficacy or performance of a product cannot be established. Failure to test certain patient populations may, however, result in liability if the information provided to the intended users does not appropriately reflect the indication for use for which the product has been authorised or CE marked.
6.3 Does the jurisdiction permit the compassionate use of unapproved drugs or medical devices, and what requirements or regulations govern compassionate use programmes?
At EU level, Article 83 of the EMA Regulation establishes the basis for permitting the compassionate use of unapproved medicinal products. Accordingly, unauthorised medicinal products may be made available for compassionate reasons to a group of patients with a chronically or seriously debilitating disease, or whose disease is considered to be life-threatening, and who cannot be treated satisfactorily by an authorised medicinal product. The EMA Regulation also requires that the medicinal product is either subject of a marketing authorisation application or be undergoing clinical trials.
The EMA's Committee for Medicinal Products for Human Use ("CHMP") may issue opinions in relation to the establishment of a compassionate use programme. However, it is up to the competent national authorities of individual EU Member States to decide on the establishment of such compassionate use programmes and their related implementation. As a result, further details regarding compassionate use programmes are established in the national laws of EU Member States.
6.4 Are waivers of liability typically utilised with physicians and/or patients and enforced?
The systems related to damage compensation for patients participating in clinical trials or compassionate use programmes are governed by the national legislation of EU Member States. As a result, the use of waivers of liability and related enforcement is a matter of EU Member States' national law. Please refer to the individual country chapters.
6.5 Is there any regulatory or other guidance companies can follow to insulate or protect themselves from liability when proceeding with such programmes?
There is no specific guidance that companies can follow to
protect themselves from liability. The best manner in which
companies can protect themselves is ensuring that clinical trials
and studies are conducted in accordance with all applicable laws,
EU and national guidance documents, best practices, and clinical
trial or study documentation designed and approved for the conduct
of the clinical trial or study (e.g. protocols, informed consents,
procedures and controls). To that effect, companies should also
ensure that standard operating procedures are in place, conduct
appropriate training and vet any vendors they may collaborate with
when conducting clinical trials or studies.
7. Product Recalls
7.1 Please identify and describe the regulatory framework for product recalls, the standards for recall, and the involvement of any regulatory body.
For medicinal products, the regulatory framework for product recalls is set out under the Community Code and Directive 2003/94/EC laying down the principles and guidelines of good manufacturing practice in respect of medicinal products for human use and investigational medicinal products for human use.
Manufacturers of medicinal products are required to implement a system for recording, reviewing, and investigating complaints concerning defects of a medicinal product, together with an effective system for promptly recalling medicinal products. The same requirements apply to manufacturers of investigational medicinal products, who must collaborate with the sponsor of a clinical trial and the marketing authorisation holder for the medicinal product, if any.
Manufacturers of medicinal products and marketing authorisation holders are also required to report to the relevant national competent authorities of EU Member States and the EMA, as applicable, any product quality defect that could result in a recall or abnormal restriction on supply. Where the quality defect presents a serious risk to public health, the marketing authorisation holder will need to work with relevant national market surveillance authorities to agree corrective measures, including communications to alert healthcare professionals. National market surveillance authorities must take steps to notify the issue, and any recall, through the EU rapid alert system (a platform/database designed for sharing information about unsafe products).
For medical devices, the regulatory framework for product recalls is set out under MDR and the IVDR. Manufacturers of medical devices and IVDs are required to establish and implement a pot-market surveillance system relating to devices they place on the EU market. They are also subject to vigilance obligations, according to which manufacturers must report to relevant competent authorities "serious incidents" and "field safety corrective actions" ("FSCAs"), including product recalls, relating to devices made available on the EU market. The Regulations establish strict deadlines for fulfilling reporting requirements.
In terms of the standards that apply in determining whether or not to recall a product, where manufacturers have reason to believe that a device which they have placed on the market or put into service is not in conformity, they are required to immediately take necessary corrective action to bring that device into conformity, to withdraw it or to recall it, as appropriate. To determine what action is appropriate, the manufacturer should carefully assess the risk. If a risk assessment determines that a recall or withdrawal of the device is necessary to reduce the risk of death or serious injury, then – as with medicinal products – manufacturers will need to work with relevant national market surveillance authorities to agree corrective measures, including communications, to alert healthcare professionals.
7.2 What, if any, differences are there between drugs and medical devices or other life sciences products in the regulatory scheme for product recalls?
Generally, the regulatory scheme for conducting product recalls for medicinal products and medical devices are similar.
One significant difference is the role and involvement of institutions at EU level. For medicinal products, the EMA takes a coordinating role in the assessment of quality defects. In the context of medical devices, on the other hand, recall procedures are usually coordinated at national level. Whilst it is possible for the European Commission to assist with the coordination of a significant recall (either in terms of the number of EU Member States affected, or the seriousness of the risk), the recall of medical devices is generally supervised largely at the national level by relevant market surveillance authorities.
7.3 How do product recalls affect litigation and government action concerning the product?
Product recalls have the potential to result in both consumer litigation, regulatory and enforcement actions. Product recalls may lead to further investigations from competent authorities and Notified Bodies in relation to products placed on the EU market, which in turn could result in the suspension, revocation, withdrawal or marketing authorisations of medicinal products or CE Certificates of Conformity relating to medical devices. In addition, EU Member States could bring administrative and criminal enforcement proceedings in the context of recalls, either for an underlying non-compliance that led to the recall, or for any failure to adhere to recall obligations (e.g. reporting requirements).
In consumer product liability litigation, the existence of a recall has the potential to affect the assessment of defect under the PLD, including as follows:
- The existence of a recall and any related non-compliance may be a relevant circumstance, and potential evidence, for the purposes of assessing defect. Particularly where a claimant can establish they were harmed by the same issue that led the manufacturer to take corrective action.
- EU case law raises the possibility that a whole product type can be classified as defective where a group of products has been subject to field safety action on the basis of an identified issue. In Boston Scientific Medizintechnik GmbH v AOK Sachsen-Anhalt: Die Gesundheitskasse and Betriebskrankenkasse) (Cases C503/13 and C504/13), field safety action was taken by manufacturers of pacemakers and defibrillators in relation to a defect that could lead to premature battery depletion of some pacemakers and a potential issue with the magnetic switch in the defibrillator. The European Court of Justice ("ECJ") held that the level of safety persons were generally entitled to expect was particularly high in these cases, given the life-sustaining function of the products, the abnormal potential for damage and the vulnerability of the patients. In these circumstances, the ECJ suggested that where it was found that products belonging to the same group or forming part of the same production series have a potential defect, it is possible to classify as defective all the products in that group or series, without there being any need to show that the product in question is defective.
This is, however, an area that could be subject to reform in the EU. The European Commission published its legislative proposal to revise the PLD on 28 September 2022. In particular, the Commission has proposed to revise the PLD to expand the non-exhaustive list of factors to be taken into account in the assessment of defect to include corrective action, including recalls. Moreover, where a claimant establishes that a product does not comply with mandatory safety requirements under EU or national laws intended to protect against the risk of damage that has occurred, the Commission has proposed that the defectiveness of the product should be presumed. It remains to be seen whether or not this proposed change will be adopted in the final text. At the time of writing, the Commission's legislative proposal is still making its way through the legislative procedure .
7.4 To what extent do recalls in the United States or Europe have an impact on recall decisions and/or litigation in the jurisdiction?
There is a growing level of cooperation between international market surveillance authorities, both directly (including those in the US and Europe) and through organisations like OECD. Increasingly, recalls announced in one jurisdiction are likely to come to the attention of authorities in other jurisdictions. As a result, it is important that manufacturers develop a global strategy for handling product crises and rolling out corrective actions across international markets.
The announcement of a recall may prompt consumer claims.
7.5 What protections does the jurisdiction have for internal investigations or risk assessments?
Protections including legal privilege exist under the national laws of EU Member States, rather than at EU level. Please refer to country chapters for more details.
In practice, it is common to provide information, including risk assessments, to investigating market surveillance authorities. There may be opportunities to provide certain information on a confidential basis, but companies should keep in mind that information may become public through publication or under freedom of information mechanisms.
7.6 Are there steps companies should take when conducting a product recall to protect themselves from litigation and liability?
It is important to ensure that companies prepare for the possibility of follow-on claims during strategic planning for a recall, including as follows:
- Immediate steps to preserve relevant evidence and protect privilege. Decisions taken during the recall process and external advice from product safety counsel should be documented carefully.
- Alignment and coordination of global recall activities. It is critical that the messaging remains consistent across different markets, otherwise there is a risk that other market surveillance authorities and claimants could pick up on statements made about the product in other jurisdictions.
- Tight controls over all recall communications, with drafts of notifications and correspondence with market surveillance authorities, customer and end user announcements reviewed by product safety and litigation counsel.
- Training of all teams handling roll-out of the recall, including those dealing with customers and end users. Template emails and phone scripts should be developed to ensure that clear, accurate and timely information can be provided to the market.
- A clear escalation process should be put in place to address
and resolve concerns raised by customers and end users to avoid
escalation, complaints to market surveillance authorities or
8. Litigation and Dispute Resolution
8.1 Please describe any forms of aggregate litigation that are permitted (i.e., mass tort, class actions) and the standards for such aggregate litigation.
Mechanisms for aggregate litigation are currently provided in a very limited number of EU Member States through national laws.
However, at EU level, the Representative Actions Directive (EU) 2020/1828 ("RAD"), which is due to apply from June 2023, sets out to change the regulatory landscape related to class actions. The RAD will permit consumer organisations to bring representative actions in a single EU Member State, or cross-border in multiple Member States. Qualified entities can seek injunctions or redress, including compensation, from traders for breaches of a wide range of EU laws, including the Product Liability Directive, MDR, IVDR and Directive 2001/83 on medicinal products. Although the Representative Actions Directive does not adopt a full, US-style class action procedure, it does make the risk of consumer organisations amassing large collections of EU claims a much more threatening one.
8.2 Are personal injury/product liability claims brought as individual plaintiff lawsuits, as class actions or otherwise?
The requirements and related mechanisms for pursuing personal injury or product liability claims are currently established in the national legislation of EU Member States. Please refer to the individual country chapters.
8.3 What are the standards for claims seeking to recover for injuries as a result of use of a life sciences product? (a) Does the jurisdiction permit product liability claims? (b) Are strict liability claims recognised?
This is currently a matter of EU Member States' national law. Please refer to the individual country chapters.
8.4 Are there any restrictions on lawyer solicitation of plaintiffs for litigation?
This is currently a matter of EU Member States' national law. Please refer to the individual country chapters.
8.5 What forms of litigation funding are permitted/utilised? What, if any, regulation of litigation funding exists?
This is currently a matter of EU Member States' national law. Please refer to the individual country chapters.
8.6 What is the preclusive effect on subsequent cases of a finding of liability in one case? If a company is found liable in one case, is that finding considered res judicata in subsequent cases?
8.7 What are the evidentiary requirements for admissibility of steps a company takes to improve their product or correct product deficiency (subsequent remedial measures)? How is evidence of such measures utilised in litigation?
8.8 What are the evidentiary requirements for admissibility of adverse events allegedly experienced by product users other than the plaintiff? Are such events discoverable in civil litigation?
8.9 Depositions: What are the rules for conducting depositions of company witnesses located in the jurisdiction for use in litigation pending outside the jurisdiction? For example, are there "blocking" statutes that would prevent the deposition from being conducted in or out of the jurisdiction? Can the company produce witnesses for deposition voluntarily, and what are the strategic considerations for asking an employee to appear for deposition? Are parties required to go through the Hague Convention to obtain testimony?
8.10 How does the jurisdiction recognise and apply the attorney-client privilege in the context of litigation, and with respect to in-house counsel?
8.11 Are there steps companies can take to best protect the confidentiality of communications with counsel in the jurisdiction and communications with counsel outside the jurisdiction for purposes of litigation?
8.12 What limitations does the jurisdiction recognise on suits against foreign defendants?
8.13 What is the impact of U.S. litigation on "follow-on" litigation in your jurisdiction?
8.14 What is the likelihood of litigation evolving in your jurisdiction as a result of U.S. litigation?
Originally published by The International Comparative Legal Guides.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.