Stand Alone Clinical Trial Liability Insurance Policies

September 11, 2013

Growth in Clinical Trials = New Liability policies

Additional awareness of clinical trial exposures will result in insurance carriers creating new policies, similar to clinic, or urgent care medical malpractice insurance policies or other healthcare facility insurance policies. There is a trend in the Pharmaceutical industry to outsource some research to teaching hospitals, which forces the issue of when to purchase a clinical liability insurance policy.

Some hospitals are willing to absorb the risk and take it on their policies. Other hospitals are asking Insurance Carriers to only cover the professional liability portion of the clinical trial…leaving the financial management/contractual risk uncovered.

Some research clients have begun to ask for tailored, specific clinical trial coverage in order to protect themselves prior to signing the contract.

Companies engaging in clinical trial work must be sure to bind a clinical trial liability policy that contemplates the number of Sponsors with which they contract to perform services and the number of independent investigators.

A recent Wall Street Journal article stated that The prospect of compensation for injuries encourages volunteers who might otherwise be reluctant to participate, exposing already vulnerable research companies.

the consent forms protect the clinical trial co.; But the wording in these consent forms is often confusing and vague. It can be unclear which research entity is responsible for the cost of subsequent care.

One big problem is that it can be difficult to separate what was caused directly by a trial vs. what might have occurred anyway from the natural progression of the participant's disease.

Wall Street Journal Reports more business growth

The Journal Article goes on to say that the issue of liability in clinical trials has come under increased scrutiny as trials continue to increase in need and popularity. The growth has come in part from a jump in small early-stage trials meant to help drug companies weed out drugs not worthy of investment and development.

Demand for Trials continues as desire to safely release tested drugs grows:

Makers of the drugs say that the trials are necessary to test over and over for quality and efficacy as the drugs come to market. Drug companies felt protected by their consent forms, which discouraged the claims; however after one landmark, highly publicized case of a Parkinson’s Disease clinical trial, it was shown that it was possible to find flaws in the informed-consent process and sufficient maneuvering room in the wording to be successful.

In addition to Professional Liability: Regulatory Compliance and Billing Risk:

There are ancillary risks of doing this business for hospitals is presented with the expanded HIPAA regulations. Regulatory or billing Errors and omissions products are offered by standard insurance companies to protect these entities. Some hospitals, like physicians have some limited HIPPA or regulatory coverage. But the Academic medical centers can bolster their own Professional Liability claims records by asking carriers to insure this risk separately.

There is little definitive data on the number of injuries from clinical trials; but as the numbers increase, the bad outcomes will increase. There was the death in 1999 death of an 18-year-old who participated in a gene-therapy trial at the University of Pennsylvania.

Clinical Research Liability Policies

Clinical Trial Research companies can easily protect themselves by submitting an application with an agency familiar with the specialty carriers; the carriers will look at the number of volunteers, subjects for the trial, the number of contracts with Sponsors and the types of procedures. Additionally, the policy may be written to extend to the number of M.D. supervisors, Medical Directors and specialists performing the work, providing the services of the trial.

As the work of Drug Companies grows, so does the need for established clinical trial companies contracting to professionally perform the services. The Doctors’ Insurance Agency will help you to