Imagine you learn of a serious adverse event that involves your product. Upon receiving notice of the occurrence, your company is obligated immediately to perform certain activities, which first includes investigating your product’s alleged failure. When the adverse event signals a wider threat and the public’s safety is potentially at risk, you may need to undertake a recall or other post-market corrective action to prevent additional injuries. Who is in charge of coordinating your response to the crisis, and how can you undertake a recall with minimal interruption to your normal operations? Adverse events often give rise to products liability lawsuits. When you learn of an adverse event, there are things you can do immediately that may ultimately assist with the defense of your future products liability case, but who is going to do these things and what should they do?
The best way to answer these questions and prepare for this sort of challenge is to develop product safety initiatives and related procedures that will help you identify and manage an emerging crisis. Don’t wait until a crisis develops to determine your company’s strategy for responding appropriately. What needs to be done now will vary between companies, depending on their sizes, product lines, and personnel. However, below, we set forth a description of several common actions that well-prepared companies do in case such a crisis arises.
Documents: Developing and Maintaining a Document Retention Policy
Just as the product, itself, can be important to investigating the adverse event, so are the records you maintain about the product, including documents about its development, production, performance, and sale, among others. Documents are also critical in products liability litigation. Electronic discovery (e-discovery) has revolutionized the discovery process, and dramatically expanded the breadth and number of documents subjected to the other side’s review in the course of a lawsuit. In fact, a company that enters litigation should be prepared to hand over 4,980,441 pages, on average, of documents to the other side during discovery. (See “Litigation Cost Survey of Major Companies,” Lawyers for Civil Justice, Civil Justice Reform Group, US Chamber Institute for Legal Reform, 2010 Conference on Civil Litigation, Duke Law School, May 10-11, 2010, p. 3.) Companies that implement document retention policies tend to have a more efficient document review and collection process.
A sound document retention policy has two distinct but equally important parts: (1) guidance and restrictions on document creation and (2) procedures for document retention and destruction. In addressing the first part, it is important to remember that what is recorded in your documents today can impact the outcome of a future products liability claim, so the information you record about an adverse event, for example, must be of the highest integrity. Employees—particularly those in complaint-handling or adverse-event trending roles—should be trained to document information in an objective and factual manner, and certain documents associated with these functions should undergo a system of review to ensure excellent documentation practices.
For the second part, there should be finite limits of time on the retention of documents routinely created in the course of business, and such time limits need to be set forth in your policy. Your business practices, as well as laws and regulations, such as those related to the Internal Revenue Service, will determine the length of time you must keep documents. Life sciences companies, specifically, need to ensure that documents created in accordance with Quality System Regulations (e.g., design history records and product complaints) are retained for the prescribed periods of time set forth in the related regulations. When a document’s time limit expires, it is important to destroy it either automatically (in the instance of some electronic documents, such as e-mail) or manually (in the case of hardcopy documents). Document destruction must comport with the terms of your policy, and you must never destroy documents that relate to anticipated or on-going litigation due to concerns for spoliation, as described in Part II of this article, and other legal consequences.
Product Safety: Monitoring Your Product to Identify Potential Hazards
In all instances, when a company learns of an adverse event, public safety is paramount. (Please see the previous edition of the Litigation 360 series, “Responding Effectively When Your Product is Under Attack,” which discusses the importance of ensuring public safety when responding to a crisis.) For this reason, it is important to determine whether the adverse event is an isolated incident or indicates a problem with the device that could occur in additional product units already in the hands of end-users. A company that conducts excellent post-market surveillance will have an advantage when it comes to assessing the scope of risk associated with adverse events. Additionally, companies that monitor post-market information about their products continually may be able to get out in front of product safety issues before adverse events occur.
The FDA requires companies to document not only adverse events but customer complaints.1 (See 21 CFR 820.198.) The FDA further requires companies to conduct “trending,” which is the proactive assessment of product quality attributes, user complaints, field incidents, and product testing intended to identify common threads and/or detect a frequency of particular incidents rising above a critical threshold. (See 21 CFR 100(a)(1).) Trending is a useful tool whereby companies can recognize emerging product safety concerns. For example, suppose that a manufacturer of electrosurgical knives begins to receive complaints from surgeons that the devices seem “too hot” to the touch, which has caused surgeons to stop procedures temporarily in order to avoid discomfort to themselves. A pattern of such complaints may indicate a manufacturing problem, particularly if the problematic devices are associated with a particular product run or originate with a certain manufacturing facility. Or, for example, suppose that a manufacturer learns from healthcare providers that its device warns that “battery backup power may not be available” immediately after the batteries are replaced. A pattern of such complaints could indicate a device malfunction arising from a manufacturing or design problem, or it could also indicate that users are experiencing difficulty with this product maintenance procedure, perhaps due to poor instructions or training. Conducted properly, trending data can provide an early warning of emerging product safety problems and illuminate potential solutions.
An adverse event that is not connected to a larger trend of safety problems can give rise to FDA reporting requirements, not to mention a products liability lawsuit. However, an adverse event connected to a string of similar problems may indicate that a post-market correction is required to protect the public. In order to identify emerging issues and respond effectively, consider creating a designated product safety team that reviews adverse events, trending data, and other product safety information and determines what mitigation efforts are necessary to ensure the safety of end-users. This team may also make recommendations for product development.
While studying trending data is central to such a team’s activities, reviewing product safety information from other sources is also important. Specifically, the team should regularly monitor competitor products to identify safety issues that may be common to their product. Study of the warnings and instructions provided on competitor products should similarly not be ignored, as they may be used in a products liability lawsuit to suggest an inadequacy in warnings provided by the manufacturer defendant. Additionally, the team should monitor medical journals, news stories, and social media outlets for information that may indicate how well their product is performing in the field as well as to ensure that their product has kept pace with advancing technology. Indeed, a manufacturer has a duty to ensure that its product continues to evolve as new information and innovation dictate. For example, imagine a series of adverse events garner media attention and raise questions about the efficacy of cleaning protocols for a type of reusable device that can be a source of contagions if not sterilized properly. The product safety team of a company manufacturing the same type of device should identify this risk as potentially applicable to its own product and then address it by recommending that their own sterilization procedures be reevaluated. In light of the manufacturer’s duty to evolve its product in accordance with the demands of public safety, this reevaluation is all but obligatory.
A company that uses a team-approach to monitor product safety issues and determine the necessity of post-market corrective actions should consider the following:
Who should comprise the team? Product safety teams are typically composed of personnel from several key departments, such as from quality, regulatory, legal, operations, engineering, and customer service.
Is the inclusion of legal counsel appropriate? A company may include legal counsel on their team’s roster for the purpose of creating privilege. Before doing so, be sure to understand what sort of legal assistance creates privilege. Merely including an attorney on the team may not be enough to ensure that the team’s activities are privileged during litigation.
How often should the team convene? The team should meet regularly as determined by the frequency of customer complaints and adverse events. For some companies this may be monthly, for example, and for others is may be quarterly.
How should the team’s activities be documented? In order to ensure corporate accountability for the team’s findings and activities, require the team to report its findings to senior management.
Recalls: Taking Steps to Avoid Additional Injuries
Removing hazardous products from the market can be the single most effective way to prevent injuries to end-users. Further, performing a recall efficiently and effectively is important to avoiding lawsuits that are allowed in many states that arise when manufacturers “botch” recalls or fail to conduct them in a reasonable manner. (See Restatement (Third) of Torts: Products Liability § 11 (1998).) However, executing a recall efficiently and effectively takes preparation. Putting a procedure in place to guide the process can make a difference to the outcome.
Written procedures developed well in advance of a product crisis describe the circumstances under which the company will conduct a recall or the product-specific factors that may indicate that a recall is necessary. Typically, such procedures will also name the individuals who will be responsible for conducting the recall, the scope of their responsibilities and authority, and the criteria the company will use to determine whether the recall has been effective.
For life sciences companies, undertaking recalls means working closely with the FDA to ensure that certain regulatory requirements are met. The FDA provides an overview of their requirements for recalls in the publication, Industry Guidance: Information on Recalls of FDA Regulated Products
. It is paramount that life sciences companies comport with all applicable FDA requirements; however, sometimes the efforts necessary to mitigate a potential products liability risk require action beyond what is required by the FDA.
As respects recalls and efforts to mitigate products liability risk, doing the following can be of great value:
Identify those parties that should be informed in the event of a recall. Procedures that describe how a company will conduct a recall usually identify the entities that the company must inform of the recall, such as suppliers and distributors. Also include on that list your insurance broker, who can offer suggestions about any insurance reporting requirements or implications for coverage.
Establish a path of legal review for all public documents. A company should require all communications to the public, including notices to the FDA and press releases, to undergo review by a products liability attorney. Too frequently, the only legal review these documents receive is to determine whether they meet FDA regulatory requirements. An attorney knowledgeable about products liability can assist with drafting the documents to ensure that they will not be problematic should a products liability lawsuit arise.
These recommendations are intended to help life sciences companies anticipate and manage emerging risks. In Part II, we will look at policies and procedures that will help you investigate an alleged adverse event and mitigate damage to your brand’s reputation through effective media communications.
1. A “complaint” means any written, electronic, or oral communication that alleges deficiencies related to the identity, quality, durability, reliability, safety, effectiveness, or performance of a device after it is released for distribution. See 21 CFR 820.3(b).