My last Blog focused on medical device manufacturers and preventable risks. The specific focus was on manufacturers’ internal quality management systems and compliance with FDA’s Quality System Regulation and ISO 13485. The issue is product liability exposure. This Blog also will focus on product liability exposure, but will expand beyond the quality management system. Again I will use the internal findings of the Medical Device Insurance Company study recording adverse legal judgments against medical device manufacturers they insured. The Blog only touches on a small portion of the findings and issues raised by the study, but it expands the issue of product liability exposure.
- Too often management failed to use proper or adequate legal assistance to review, launch or be involved in clinical studies.
- On a number of occasions, researcher credentials were not authenticated, which placed the results of the clinical studies in question.
- The management staff of new life science firms selected to conduct the clinical trials/studies often do not possess the appropriate expertise/experience with clinical investigations. While many were familiar with the research and development of the medical device, they did not have the professional clinical competencies needed to lead and manage a clinical study.
- Researchers, sponsors and/or company managers of US-based life science firms involved in clinical trials, particularly those conducted in Europe, were not familiar with the insurance requirements needed to conduct the studies in specific countries.
- Too often company managers did not include indemnity/disclosure informed consent agreements between IRBs, sponsors and patients in the studies.
- Management often failed to require documented methods, processes or procedures for communicating product safety concerns during product development, product design or innovation and/or demonstrating the company’s commitment to product safety in the firm’s business processes.
- During early commercialization of a medical device, it is critical for biotech firms to be in compliance with FDA regulations which require compliance with FDA’s Quality Systems Regulation (QSR) 21 CFR 820, because plaintiffs’ product liability claims arising during this time will use any negative regulatory information such as non-compliance against the manufacturer to prove their case
- The study found that several medical device firms did not adequately investigate and analyze post study medical device incidents and integrate reporting of these incidents (non conformities) into their FDA and EU mandated quality management systems.
- The study found a lack of a triggering mechanism that would give an early warning within its customer complaint handling system to allow for early intervention by quality assurance and/or regulatory personnel.
- Customer complaint feedback processes often did not treat feedback as an indication of a non-conformity requiring corrective and preventive action by the company’s quality management system that might result in design review, risk analysis, design change and production change.
- The study revealed that warranty claims and allegations arise as counts (failures) in product liability lawsuits from advertising materials that products don’t work as claimed in product advertising documents.
- A lack of general and specific training for managers concerning their product safety responsibilities has been noted as a recurring problem in product liability avoidance.
- In several instances plaintiffs’ attorneys have alleged that medical device, drug and chemical warnings in packaging were inadequate to warn users of potential risks and hazards.
- The study noted that product safety recall communications is the item that triggers plaintiffs’ product liability claims and litigation.
- The adequacy of product warnings and warnings and communications have been challenged on the basis that the warnings were not evaluated from a human factors viewpoint and documented during a design phase of product development.
- The study noted that a specific area that should be considered at the product development stage was the construction of a company’s Internet websites and misleading claims and ‘testimonials’.
- Warranty claims arise from words used, descriptions used in advertising claims and marketing materials including off label references or inferences. All such written information must be reviewed at the design stage of product development.
- Too often clinical safety information is carelessly worded or prepared and used against the company to support plaintiffs’ allegations of product liability.
- The study found that medical device firms too often lack a clear understanding of the potential risks and legal complications with misunderstood safety documents and communications.
- Failure to implement policies, procedures and practices to control e-mail documentation and electronic records, have allowed draft documents, internal company documents, documents never used as possible ideas for product improvements to be made the “smoking gun” sources of proof for product liability claims and lawsuits.
- The study often found poor cooperation with the insurance underwriters by the insured medical device company. Underwriters were not seen as business partners in both understanding the company’s business needs and claims defense/settlement needs.
- In many product liability cases, the ego of medical device company management was in conflict with a business decision proposed by the insurance company to settle a product liability claim rather than continue litigation ultimately increasing the company’s litigation loss.
- The same claims management and settlement issues also became challenging in established firms with in-house counsel refusing to accept the advice of the on-site product liability defense counsel.
- Several instances arose in which a merger or acquisition was undertaken without any input from the underwriter. This resulted in the acquisition of unwanted liability and cover disputes.
- Merger and acquisition activities also generated significant liability for the acquiring company due to inadequate due diligence of potential liability risks.
- The study discovered that OEMs and Contract Manufacturers (CMs) relying on the mistaken belief that they are immune to product liability because of the manufacturing relationships with one another.
- The study found that often there was a lack of written pre-manufacturing agreements between OEMs and CMs relying on the less effective terms and conditions of a standard purchase order.
- The study found too often there was a failure of medical device manufacturers to comply with the FDA Quality System Regulation for contract manufacturing agreements.
It should be apparent by now that there are many areas where product liability exposure exists and product liability avoidance should be practiced. As noted earlier, these are but a few of the findings from the Medical Device Company litigation history study. Clearly, language is critical in every phase of medical device manufacturing – internal quality documents, warnings and instructions, advertising and sales. A keen legal eye needs to be focused on language at every phase of the manufacturing process. Too often neither Management, key employees (Quality Manager, Regulatory Manager, Staff Attorneys) were prepared to systematically deal with product liability exposure or what might be done to address these issues. The risks are clear and preventable, but too often not even perceived. The concept of product liability audits, product safety audits, human factors audits, etc. are unknown in the medical device industry.
I have joined a group of colleagues to work with medical device companies in the US and in the EU where there is a fear of product liability litigation in the US. We combine expertise in risk management, human factors, document control, insurance, loss control, preventive law, FDA’s Quality System Regulation, EU Medical Devices Directives, and Quality Management Systems. We are preparing new approaches to address these concerns.
My primary focus has been on International Regulatory Compliance, which includes both the requirements of US & EU regulatory authorities and the legal implications of compliance, non-compliance, documentation and sloppy attention to detail that could result in a lawsuit in a US Federal Court or state courts. I focus on product safety, product liability and the steps necessary to create a safe product. I also serve as Legal Expert/Expert Witness where safety has been compromised or ignored resulting in damage, injury and/or death. If you have questions regarding ISO 9001, ISO 13485, FDA’s Quality System Regulation or CE Marking lawsuits you can contact me for a free preliminary consultation at my e-mail address email@example.com