UK Phase I Clinical Trial Insurance and Compensation


What’s the Legal Position?

With around a thousand clinical trials a year taking place in the UK, it is generally acknowledged that there is a need to compensate healthy volunteers who suffer injury as a result of participating in a clinical trial – even when legal liability under general law can’t be established.
Proving entitlement to compensation following an injury is challenging for healthy volunteers not only because injury can happen without evidence of fault by either the Sponsor or the Investigator, but also because it is hard to establish liability of the producer of the drug due to (1) the informed consent process (volunteer signing a waiver/consent form) , (2) the development risks defence and (3) proof at common law (depending on jurisdiction) that the process of Administration was non-standard.

 …and the Insurance Position?

In the UK, clinical trials can only proceed if provision has been made for insurance (or indemnity) to cover the liability of the Investigator and Sponsor. This is set out in the Medicines for Human Use (Clinical Trials Regulations 2004).

Sponsors cannot claim to meet this requirement by saying they have the financial ability to meet a claim (so-called ‘self-insurance’) under the Association of British Pharmaceutical Industry (ABPI) compensation guidelines.  Insurance by a third party is required.  This is also the position of the UK Department of Health.

When volunteers receive compensation, it should include situations where they are injured through negligence by the Investigator.  The Sponsor can pursue contribution or full indemnity from the Investigator for any payments made is respect of claims attributable to the Investigator’s negligence  (see Hunter V Hanley).

How have Compensation Guidelines Changed?

There is a clear distinction between ‘first into man’ studies and other studies where experience has been obtained from comparable doses.  So the giving of a new medicinal product to healthy subjects and/or patients for the first time by single or repeated doses (irrespective of whether the molecular class or therapeutic target is known) is considered as ‘first into man’ whereas a study of a new fixed combination of known active substances already used in an approved medicinal product (but not previously used in a fixed combination) is not considered to be ‘first into man’.

For ‘first into man’ studies, the minimum level of cover required by the industry guidance is £5m (in aggregate per protocol) falling to £2.5m for other studies.  Before each study starts, the Sponsor must be in a position to confirm which guideline applies and that the required level of cover is available in respect of the protocol in question. This includes arranging annual insurance that applies to more than one study.

Injured volunteers obtain compensation without needing to prove either negligence or strict liability, only that the injury occurred through participating in the study.  In other words the basis of the insurance is no-fault liability.  Injury may only become apparent after a study has ended so the insurance must extend for a reasonable period after the last dose has been administered – which is a minimum of 3 years.

So what about the Investigator?

Sponsors should indemnify the Investigator (and any CROs involved) against any loss incurred by the Investigator as a result of a claim associated with the study (except to the extent that such claims arise from the negligence of the Investigator).  Where the Investigator is negligent, they remain partially or totally responsible. To clarify, the Investigator is deemed to be the person responsible for the conduct of a study at a trial site and (where the study is performed by a team of individuals) is the Principal Investigator. This highlights the need for contractual relationships to be formalised to pass on risk/liability with reciprocal insurance and other obligations.

In cases when the Sponsor has paid compensation due to Investigator negligence, Sponsors can seek recovery from any person whose negligence caused the injury (depending on a range of case-by-case factors).  Therefore, Investigator(s) need to have insurance to cover claims relating to employees or sub-contractors, or be able to prove that they have the finances to cover such claims.  The aggregate level of cover Investigators need for each study is roughly equivalent to that recommended for Sponsor’s insurance cover.

According to the guidelines, Investigators and physicians involved in Phase I studies must have insurance against negligence claims and it can be provided under the insurance of the Sponsor, of the CRO or through membership of a medical defence organisation. Personal insurance policies taken out by Investigators and physicians may also suffice.  The level of protection should be equivalent to that recommended for Sponsor’s insurance cover.  It is worth checking that insurance provided by medical defence organisations do cover claims arising from commercially sponsored studies.

Nurses and other qualified persons involved in studies must hold medical professional liability insurance – such as the cover provided through membership to the Royal College of Nursing.


This document comments on the guidance of the ABPI, BioIndustry Association and the CCRA in conjunction with the UK Department of Health and the National Research Ethics Service related to ‘First into Man’ Phase I studies.

The comments only apply to Phase I studies involving healthy volunteers and patient volunteers suffering from a chronic but stable condition which is not the disease that is the target of the trial.  Patients with the disease that the medicine under research is meant to treat are not covered by the guidance.

*This Article is a general commentary on basic principles; it is not intended to be exhaustive or specific to any case. Each case must be considered upon its merits. The author shall not be liable for any party’s reliance or acting upon the terms of this Article.

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