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01 April 2020

COVID-19 is becoming increasingly widespread in many countries, leading to an overload of hospitals, medical staff and clinical resources. Ongoing or planned clinical trials are threatened by COVID-19 related bottlenecks. Primarily Sponsors, but also the involved Investigation Sites and Clinical Research Organizations (CROs) are obliged to respond to these exceptional circumstances with legitimate and appropriate measures.

It goes without saying that the safety of the participants – especially regarding those in risk groups – is paramount when it comes to introducing appropriate actions to control the effects of measures of the COVID-19 pandemic on on-going clinical trials.

Competent health authorities have issued guidelines for handling the effects of COVID-19 on clinical trials:

Sponsor to observe special study management obligations

The new guidelines recognize the impact that the COVID-19 pandemic may have on the management and conduct of clinical trials. The guidelines are addressed to the parties involved in clinical research activities. Due to the fact that the Sponsor is ultimately responsible for the safe conduct of a study, ensuring compliance with the guidelines is in his primary interest. All decisions to adjust clinical trial conduct should be based on a risk assessment by the Sponsor.

The focus should be on examining and addressing the following circumstances:

  • Is the safety of study participants guaranteed in view of the additional challenges posed by COVID-19?
  • Which measures could be the most appropriate during the COVID-19 pandemic in order to ensure study participant's safety?
  • What measures can be taken to minimize the COVID-19 transmission risks (e.g. conversion of physical visits into phone or video visits)?
  • Does the monitoring plan need to be adapted due to the impact of COVID-19?
    Is the distribution of the study medication to the study participants guaranteed despite COVID-19?
  • Is the distribution of the study medication to the study participants guaranteed despite COVID-19?
  • Is the performance of laboratory tests, imaging procedures or other diagnostic tests critical to the safety of study participants ensured?

Abide to communication and documentation principles

In case the risk assessment leads to actions that affect the trial, the Sponsor is obliged to evaluate whether the relevant competent authorities and/or ethics committees must be informed.

Changes to trial conduct should be agreed with and communicated clearly to Investigation Sites and CROs, and, in addition, study participants should be informed by the investigator. The Sponsor should obtain respective re-consents from the study participants.

Protocol deviations as well as changes or amendments of the patient information need to be documented and made available to the Investigation Site and (if applicable) CRO, which shall re-confirm. To support implementation, the Sponsor's instructions to Investigation Sites and (if applicable) CROs of changes and local implications need to be made clearly visible and trackable, including marking of changed documents with track changes. All agreements and amendments should be documented at least by e-mail exchange.

Consider local regulations

Given that in many cases, multicenter studies are executed on multiple premises in different jurisdictions, it may pose difficulties to determine the applicable regulations according to which the adjustments to the clinical trial must be evaluated.

Notwithstanding the law applicable to the agreements Sponsor may have entered into with Investigation Sites and/or CROs, Sponsor must still abide to the domestic regulatory framework applying to clinical trials.

As far as clinical trials in Switzerland are concerned, the Swiss Human Research Act ("HRA"), the Clinical Ordinance ("ClinO") and the specific guidelines issued by the competent authorities apply.

Generally, the Sponsor remains primarily liable for any damages to study participants arising in connection with the clinical trial, irrespective of limitations of liability the agreements between Sponsors and CROs and/or Investigation Sites may provide.

Mitigate Financial Risks

The Sponsor's risk assessment might result in the necessity to withdraw, postpone or make amendments to the on-going clinical trial due to COVID-19, which will raise the question who has to bear the financial consequences.

Because of the overall responsibility of the Sponsor for the clinical trials initiated by the Sponsor, the Sponsor will have to bear the additional costs, postponement costs or withdrawal costs related to changes to the clinical trials due to COVID-19.

If one of these scenarios should occur, we recommend that the Sponsor carefully review its contracts with the Investigation Site and (if applicable) the CRO. In particular, it should be examined to what extent these contracts need to be amended or even terminated.

If Swiss law is applicable to these contracts (due to an explicit choice of law clause), the following legal approaches should be considered:

  • Force majeure clauses: In a first step, Sponsors should review their agreements on provisions for situations where performance is impossible for reasons beyond the parties' control. Such force majeure clauses typically foresee the exclusion of liability for the non-performing party. Note that such the applicability of force majeure depends on the exact wording and the circumstances.
  • Impossibility of performance: In the absence of a force majeure clause and the event that the performance becomes permanently impossible for both parties, Swiss law foresees that the non-performing party may be released from its contractual obligations and cannot be held liable for any damages, but must reimburse the already received consideration (Art. 119 Swiss Code of Obligations). Impossibility corresponds to an extraordinary event that could have not been prevented despite any level of diligence.
  • Delay: If the performance is merely delayed, the creditor is entitled to either (i) waive the performance and terminate the agreement (after an additional deadline) or (ii) to insist on the ordinary performance. In case the Sponsor chooses the rescission of the contract, the non-performing party may be liable for the damages arising out the non-performance, unless it can prove that it is not responsible for the delay. Such exculpation is likely to be successful if the governmental COVID-19 measures caused the delay.
  • Economic hardship: If the performance is still possible, but has become onerous from an economic point of view due to dramatic changes of the circumstance (such as COVID-19), the parties may invoke the Swiss doctrine of clausula rebus sic stantibus. According to that doctrine, contractual clauses can be modified if unexpected events would cause disproportionate duties between the parties. However, the clausula rebus sic stantibus doctrine has so far only rarely been applied under Swiss law.

If the Sponsor's agreements with a non-Swiss Investigation Site and/or the CRO do not provide for a clause choosing Swiss law as applicable, the following rule applies:

  • Closest Connection: In the absence of a choice of law clause, the contract is governed by the law of the jurisdiction which the performance under the contract is most closely connected to (Art. 117 para. 1 Federal Act on Private International Law; PILA). The closest connection is presumed to be with the jurisdiction in which the party that performs the characteristic service has its domicile (Art. 117 para. 2 PILA). Although clinical trials include multiple services in different locations, from a Sponsor's perspective, there are good arguments that the services of the CRO are deemed characteristic for the execution of the clinical trial.

What needs to be considered for new clinical trials?

Currently, the feasibility of starting a new clinical trial should be critically examined in the light of the gradually stricter COVID-19 measures and the abovementioned limitations. Besides, it must be taken into consideration that priority is given to any (new) clinical trial applications for the treatment or prevention of COVID-19 infections, and/or substantial amendment applications to existing clinical trials necessary because of COVID-19.

Our Life Sciences Team is happy to assist you.

Authors: Dr. Stefan Kohler, Ann Sofie Benz, Dan Pruschy

Topics: Life SciencesPharmaBiotechClinical TrialClinical StudiesCOVID-19Corona

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