INTRODUCTION:

Clinical trials are growing at a full strength when assessed on a global level with India being a leading hub for clinical research in the international market. A lot of funding and investment is granted by pharmaceutical companies for research in order to find the right medication for the deadliest of the diseases. Currently, clinical research alone employs 70% of the money and time, where two thirds of research and development costs being given to drug development. A study is conducted on healthy volunteers or patients with disease for which drug is being tested and it is done before a drug is being marketed in order to ensure its safety, efficacy and possible adverse effects. The whole process being known as clinical trial [1].

A predefined protocol is set for a clinical trial being conducted with a panel of clinical experts involved in the trial. Participation of volunteers in the trial, scheduled tests, process, medications, dosage, duration of trial and consent form being the overall steps involved during a study where in signing of informed consent being; the most critical of step. A detailed explanation is given to the volunteers by doctors and nurses where they are made well aware of the risks and benefit ratio. A participant can voluntarily withdraw from study at any point of time without assuming this informed consent document as a contract. Contract research organizations are responsible for carrying out the research being given as a project by drug companies or the sponsors. An unabated growth has taken place in India when CRO’S are concerned. Multinationals eyening on India and setting up establishment of CROs either directly or a jointly ventured one. CRO’S deal with a few or overall criteria of a project involved for e.g., obtaining approval by the regulatory bodies, sites for conducting a trial, investigators, investigation of sites, data collection and management, also submission of data for approval in the market. So, the major stakeholders in the whole process of marketing a new drug can be CRO’s, sponsor or the pharmaceutical company, principal investigator, hospital or the trial site and ethics committee which approves of the study and ensures safety of patients [2]. In this article the clinical trial liability exposure of subjects and major stakeholders along with the general misconception relevant to insurance coverage are the matter of concern and have been explored systematically.

PREVAILING INSURANCE POLICIES

Clinical trial liability insurance is an area of major concern which shall be looked into strictly by government and authorities involved, the reason being exposure of patients to risks like injuries by the procedure employed, injuries due to administration of drug, failure to follow the protocol by investigator or clinical panel experts. Clinical trail insurance policies pays the amount as compensation to the insured, on claims made by volunteers involved in the study either due to death, bodily injury, or adverse reactions. Insured includes hospitals, sponsor, investigator, hospitals, CRO’S, ethics committee. The policy can be a single policy or multitrail policy. “No fault compensation” is the principle followed by the companies according to which without any proof of fault of the insured, in case of injury or adverse event during a trial the subject should be compensated. The insured should be paid the fixed compensation within 3 months after which trial subject can go to court for compensation through legal proceedings. “Claims made policy” means if a claim is filed during policy period or claim is registered during the coverage period the insurer is responsible. If a company renews a current policy or buys a new one the retroactive date should be same as it was in the original policy therby holding insurer responsible for incidents occurring during the company being in coverage whether or not claim was filed. “Extended discovery period” is followed in a single trail policy where after completion of trial insured can discontinue or renew a policy for 12 months. Even on discontinuation, insured has 3-6 months discovery period in which notification of claim can be made by the insured discovered to subject on expiry of policy. 6 months to 3 years is the buying of discovery period in certain countries with India not following any such regulation. Rates of premium is decided based on phase of trial, tested formulation, number of subjects, age of subjects and result of trial. While for limits of coverage, there are no sets of rules however as per clinical trial liability policy it can be minimum of $ 1 million or $ 10 -20 million. Some of the countries with compulsory licenses are Germany , Checz Republic, France, Netherland , Japan, New Zealand, Austria, Greece etc. where Germany, Austria, Netherland are accident type, rest of the countries are liability. Also compensation of insurance is not fixed as per law. Non compulsory insurance examples are United Kingdom (special regulation or liability), USA, India, Luxembourg and Mexico. If compulsory insurance is not found, coverage is given under liability policy [3].

Newline is an insurance company which ensures coverage based on specific territorial regions and is written in local language wherever required. On behalf of Newline, a local overseas policy can be issued or a direct policy where direct policy is banned by local law. Master policy on DIC/DIL basis can be provided to insured. Argentina, Bulgaria, Austria, New Zealand, Belgium, Canada, France are some of the countries which writes policies on behalf of Newline [4].

Allainz global corporate and specialty clinical trial insurance cover policy provides compensation to sponsors, pharmaceutical companies and CRO’S also liability for injury to participants on “no fault” compensation and during the entire duration of the trial. Requirement of high insurance limits adds to the cost of the trial and regions with unlimited liability can lead to unavailability of insurance. Countries with prevalence of local insurance sponsors should look for insurer which performs at a global level and has locally licensed subsidiaries. As a global insurer can help in ensuring that the policy meets the local requirements. So, pharmaceutical experts should join hands with the insurer with laws and regulations that ensures safety and efficacy in the conduct of a trial [5].

PROBABLE LOOPHOLES

Clinical trial agreements generally indemnify clinical investigators for problems with the study drug, but never for the investigator’s negligence. Most indemnification clauses contain loopholes. The probable loopholes [6] are:

Injuries caused by study procedures often are not covered;
Injuries prior to randomization - in other words, during the screening process may not be covered;
Even 1% contributory negligence by the investigator may void the indemnification, as may be an unrelated deviation from the protocol on another subject;
Prior written authorization may be required to charge the sponsor for treatment.

CASE STUDY

Health Alliance of Greater Cincinnati and Christ Hospital kickback investigation settlement

On violation of the anti-kickback statute and false claims act the health alliance of greater Cincinnati and the Christ hospital in mount auburn ,Ohio, agreed to pay $ 108 million in may .the Christ hospital was a former member of health alliance of greater Cincinnati and both of these organizations were actively involved in illegal payment to physicians in exchange of referring cardiac patients to the respective hospital. The government made allegations that cardiologists where given increased percentage of time at hearts station based on their contribution in increase of hospitals yearly gross income while physicians were paid additional income for treating patients at the facility [7].

Tuomey Hospital Stark Act violation guilty verdict

Tuomey hospital in sumter , S.C ., part of tuomey health system was declared guilty by a panel of jury for providing rewards to physicians in exchange of referrals to the hospital. In 2004, they offered employment contracts and part time which exceeded the fair market value in order to reward them for their referrals and in turn violated federal healthcare law. They were also alleged for violation of false claim act as they submitted claims that resulted from violation of self referral law.this claim was dismissed by jury and they were freed of medicare fraud charges but they were ordered to pay $44.9 million with interest to the government and facing a new trial due to false claim violation [7].

Los Angeles' City of Angels Medicare fraud consent judgement

Intercare health care system involved in business with los angeles city of medical centre violated false claim act and anti-kickback statute as they paid illegal measures to recruiters employed at los angeles homeless shelter as they delivered homeless patients to clients irrespective of the fact that whether these patients needed or even requested such treatments , then they used to prepare false medicare bills and medical programs. Such allegation led them to resolve a civil lawsuit where they agreed to pay $10 million to the us government [7].

Kyphoplasty-related false claims allegation settlements

As per U.S department of justice news release there were nine hospitals of different states who submitted false claims to medicare related to kyphoplasty procedures in the year between 2000- 2008 ,so they agreed to pay the government an estimated amount of $ 9.4 million to settle the allegations. kyphoplasty is a minor procedure to treat spinal fractures and these organizations as an inpatient procedure produced false increased medicare billings. the topmost hospitals involved in this fraud were ball memorial hospital in Muncie, ind., paid $1,995,431 ,Huntsville (ala) hospital paid $1,992,756 and palmetto health in Columbia ,S.C., which paid $ 1,861,083 [7].

Robert Wood Johnson University Hospital Hamilton $6.35 million Medicare fraud settlement

Allegations were made aginst Robert Wood Johnson University Hospital Hamilton (N.J.) that it inflated charges to gain supplemental outlier payments for cases taht were not costly ,since medicare was provided for these patients to obtain outleir payments. So they agreed to pay $6.3 million settlement in march ,with federal government as a part of civil settlement made to pay the amount of $ 1.1 million as settlement amount [7].

Five-Physician Sacramento Medicare fraud scheme

In the year feb 2006-aug 2008 physicians and staffs at three clinics were involved in running a $5 million medicare fraud scheme in and around sacramento calif., they forged medicare bills for patients who were not even sick. The accused vardes egiazarian, MD later confessed that these healthy patients were paid $100 per visit in exchange for false billing .dr.egizarian was sentenced to six and a half years of imprisonment and was ordered to pay $1.5 million later a grand jury extended the judgement to five additional physicians and six others who were involved in the healthcare fraud [7].

AREAS OF MAJOR CONCERN

Modifications in policies

The policy language adjustments requests from ethics committee, IRB’S and CRO’s is an area where one needs to be aware of especially in case of foreign local placements. Most common being removal of coverage exclusion for medical malpractice related claims, deviations from protocol involving principal investigator due to which AIDS/ hepatitis, mercury or invasive products, genetic damage may occur. These requests needs strict negotiations with insurance underwriters before binding coverage, also understanding and adressal of unique coverage or logistical issue so premiums must be paid prior to binding coverage in India and Nepal. As if the drug is found to be successful during the trial the patients sponsore may require to give the drug to the patient on closure of trial or patients remaining lives [7].

Issues related to contracts

Scrutiny of clinical site and clinical research organization is an area of major concern and it should be in agreement with insurance broker and attorney. the primary focus should be on the policy language and insurance requirements that ensures maintenance of adequate insurance coverage and adequate limits. CRO should maintain a professional liability coverage by ensuring coverage in case of any harm to clinical trial patients and at the same time inhibiting monetary loss to the sponsor due to negligence by CRO. Additional insured status should be kept preserved and certificates should be secured as an evidence of coverage before the start of the trial. Insurance limit requirements should be kept at reasonable levels which should be appropriate for the scope as well as the phase of the trial [8].

Drug Supply Storage and Transit Issues

Drug supply, shipment and storage may require unique insurance coverage as foreign trail involving shipment and storage of a high value drug compound may require a supply chain property policy or stock through put program .these policies aims at insurance coverage for drug product at storage and transit at any worldwide locations including loss due to spoilage or contamination. In a nutshell if ethical, regulatory and risk management challenges are managed well, sponsor, host and industry will equally be eligible for benefit [7, 8].

CONCLUSION:

Clinical trials are conducted to establish the safety and efficacy of drugs, which constitute nearly 70% of research and development costs and the total time taken for drug development constitutes nearly 7-10 years. According to latest estimates made by the Tufts Centre for the Study of Drug Development, while total research costs have increased by 7.4% per year, the costs of clinical trials on human beings has risen by over 12 %. The sensitivity of the clinical trial in view of the involvement of human subject should be well understood and appreciated because they can either be healthy volunteers or patients suffering from disease for which the medicine is being tested. Each party involved in conducting the trial have moral and legal responsibilities towards the human subject and hence all have real and significant exposure to liability. The target for litigation are mostly the clinical investigators and the research institute involved. As part of any clinical trial, therefore, needs proper monitoring along with a proper insurance cover. Clinical Trial Liability Insurance (CTLI) should be introduced to every countries where insurance fraud has been the major area of concern, to cover legal liability arising out of lack of care, negligence resulting in injury or death of the subject. Insufficient disclosure and conflict of interest may also become subject matter of suit. Every company must establish and maintain a policy of adherence to the required clinical trials protocol and must not stray from safety norms. Fulfillment of informed consent rules must be ensured. Parties to the clinical trial must sign clinical trial agreement for strict adherence to the protocol and to take care of other concerns. Apart from standard exclusions (e.g. war risk, radiation, fines and penalties, deliberate contravention of instruction, etc.), the exclusion under CTLI are basically meant to exclude from the scope of the cover all eventualities that can not be attributed to and not resulting from the participation in the clinical trial.

REFERNCES:

1. Fiscus, P.W., Insuring global clinical trial, Pharmaceutical Executive 2009.

2. Ramakrishna, V., News letter from India’s leading insurance broking house, I notes 2010:1-8.

3. Swik, B.D., Insurance for clinical trials, Munich RE 2009: 1-12

4. Newline group clinical trial broucher. Accessed on 12.12.2014

5. Allainz global corporate and speciality, Clinical trial insurance 2009.

6. Rachel Fields, 2010. http://www.beckershospitalreview.com/hospital-management-administration/15-fraud-and-abuse-cases-making-headlines-in-2010.html Accessed on 02.01.2015

7. www.WGAins.com Accessed on 11.12.2014

8. Clinical-Trials-Insurance.com Accessed on 11.12.2014

Received on 09.04.2015 Accepted on 15.05.2015

Asian J. Pharm. Res. 5(2): April-June 2015; Page 114-117

DOI: 10.5958/2231-5691.2015.00017.9

*Corresponding Author E-mail: abhithakurmanyu@gmail.com