Sticking points of Clinical Trial Agreement Brandon Strickland
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1 Sticking points of Clinical Trial Agreement Brandon Strickland April 2017
2 Disclaimer The opinions expressed are those of the speakers individually and do not reflect the policies or positions of the speakers employers. Information is for educational purposes only and should not be considered legal advice. 2 March 30, 2018 Title of Presentation
3 What required in the agreement ICH GCP requires a written agreement A written, dated, and signed agreement between two or more involved parties that sets out any arrangements on delegation and distribution of tasks and obligations and, if appropriate, on financial matters. The protocol may serve as the basis of a contract. See ICH GCP 1.17, 4.5.1, 4.9.6, March 30, 2018 Title of Presentation
4 ICH GCP sets forth the minimum contract requirements The sponsor should obtain the investigator's/institution's agreement: (a) To conduct the trial in compliance with GCP, with the applicable regulatory requirement(s), and with the protocol agreed to by the sponsor and given approval/favorable opinion by the IRB/IEC; (b) To comply with procedures for data recording/reporting: and (c) To permit monitoring, auditing, and inspection (see section 4.1.4). (d) To retain the essential documents that should be in the investigator/institution files (see section 8.) until the sponsor informs the investigator/institution these documents are no longer needed (see sections 4.9.4, 4.9.5, and ). See ICH The financial aspects of the trial should be documented in an agreement between the sponsor and the investigator/institution. See ICH March 30, 2018 Title of Presentation
5 Clinical Trial Agreements: A Unique Contract Parties: Services: Different business models and outlook; Sponsors, CROs, AROs, Sites (academic and for profit), SMOs, Individual Pis Complex customized services; Highly regulated industry Allocation of rights: Sharply different views; Overlay of laws/regulations/business & academic research interests 5 March 30, 2018 Title of Presentation
6 Know who on the other side Sponsor CRO Law Firm Site PI 6 March 30, 2018 Title of Presentation
7 Know who on the other side Sponsor CRO Law Firm Site PI 7 March 30, 2018 Title of Presentation
8 Know who on the other side Sponsor Move from IND to NDA Protect IP Stick to development timelines Marketing support Partners Investor & Shareholders 8 March 30, 2018 Title of Presentation
9 Know who on the other side CRO Serve the client Abide by SOP Meet client deadline Add need resources for oversight of research Come in under budget 9 March 30, 2018 Title of Presentation
10 Know who on the other side Law Firm Serve the client interest Highlight minimize all potential risk to client May be working for CRO SITE Sponsor SMO 10 March 30, 2018 Title of Presentation
11 Know who on the other side Site Enforce Institutional Policies HIPPA Protect IP Medicare Coverage analysis Stick to budget 11 March 30, 2018 Title of Presentation
12 Know who on the other side PI Access to drug/device Publication Academic Prestige Thinks the CTA is a waste 12 March 30, 2018 Title of Presentation
13 Model Agreements MAGI Model Agreement Accelerated Clinical Trial Agreement 13 March 30, 2018 Sticking points of Clinical Trial Agreements
14 Model Agreements What the Difference between the two? 14 March 30, 2018 Title of Presentation
15 Contract Structure Parties & Signatures Scope of the Agreement Confidentiality Informed Consent Debarment Monitoring and Auditing Publication Insurance Use of name Term and termination Assignment Notice Governing law Protocol Definitions Study Drug/Device Ownership Protected Health Information Records Retention Inventions Indemnification and Liability Subject Injury Relationship Entire Agreement Severability Force majeure Budget Amendments 15 March 30, 2018 Title of Presentation
16 Were are our sticking Points Parties & Signatures Scope of the Agreement Confidentiality Informed Consent Debarment Monitoring and Auditing Publication Insurance Use of name Term and termination Assignment Notice Governing law Protocol Definitions Study Drug/Device Ownership Protected Health Information Records Retention Inventions Indemnification and Liability Subject Injury Relationship Entire Agreement Severability Force majeure Budget Amendments 16 March 30, 2018 Title of Presentation
17 Parties Choose the correct parties! There are multiple entities that could be parties: Sponsor and Site Sponsor, Site, and treatment facility (Hospital) Sponsor, Site, and PI CRO/ARO and Site Sponsor/CRO/ARO and SMO All entities listed as parties must sign the contract; so check the preamble against the signature block 17 March 30, 2018 Title of Presentation
18 Parties Watch for Government-Funded Parties Government party has sovereign immunitybenefits that other private parties do not have; Contractual Indemnity, IP rights, etc. must not violate public policy; FOIA and Open Records Acts. 18 March 30, 2018 Title of Presentation
19 Parties Signatures Every party must sign; Who has authority to bind parties? Do your due diligence: Is Signatory a VP or the janitor? Read and understood vs. signing as a party to the contract. 19 March 30, 2018 Title of Presentation
20 Parties Site s Perspective Contractual privity issue if Sponsor is not a signatory; Read Letter of Authority (LOA) carefully: Is the LOA specific to the study? Is there language that gives CRO authority to bind Sponsor to contractual obligations? Is a representation by the CRO in the CTA enough? Be clear and put the other party on notice about any applicable governmental immunity and state records acts. 20 March 30, 2018 Title of Presentation
21 Parties Sponsor s Perspective Parties Is it a 3-party CTA? Sponsor/Site and PI Sponsor/CRO/Site or Sponsor/SMO/Site Is it a 2-party CTA? Sponsor/Site Sponsor/PI What is the status of the PI? (Site s employee/practice head/independent contractor) What is the status of SMO? (signatory party/authorized to contractually bind the site 21 March 30, 2018 Title of Presentation
22 Definitions Definitions create secondary meanings: For ordinary words; For new terms created just for agreement. Case Distinction: Initial capitals: third party vs. Third Party ; Section style: All defined terms up front; In-line style: Terms defined when first used. Consistency is important: If you define a term, use it consistently! Excessive definitions = unintended consequences; Search and replace is a great tool for checking. 22 March 30, 2018 Title of Presentation
23 Study Drug/Device Site and Sponsor s Obligations Regarding the Study Drug/Device Study Drug/Device are Sponsor s IP and nothing in the agreement or any activities of Site in conducting Study should be construed to provide any rights in the Study Drug/Device. Sponsor will provide Study Drug/Device and any control/placebo free of charge for administration to Study subjects in compliancewith the Protocol. 23 March 30, 2018 Title of Presentation
24 Study Drug/Device Site s Perspective Study Drug/Device are Sponsor s IP Whose products are being provided/used in the Study? Are there comparator drugs, placebos, standard of care drugs? Limit to: in amounts specifically provided by Sponsor/CRO to Site for this Study. Provision of Study Drug/Device Return of any remaining Study Drug/Devices? At whose expense? 24 March 30, 2018 Title of Presentation
25 Study Drug/Device Sponsor s Perspective Important area of the CTA for a Sponsor. Sponsor requires Site and PI to recognize Sponsor s existing IP in the Study Drug/Study Device. Study Drug/Study Device provided solely for conduct of Study in accordance w/protocol. All inventions related to the Study Drug/Study Device belong to Sponsor (sometimes through aseparate CTA provision.) 25 March 30, 2018 Title of Presentation
26 Debarment Site's Obligations With Respect to Debarment: Not use any individuals debarred under the generic Drug Enforcement Act or other equivalent or successor statutes, rules or regulations; Represent that none of the Site, Investigator or the Study Personnel have been or are: excluded from participation in any government healthcare program; convicted of any materially relevant offense; aware of any pending or potential actions that would give arise to any such ineligibility or are the subject of a disqualification proceeding or has been disqualified as aclinical investigation participant pursuant to any authority rules. 26 March 30, 2018 Title of Presentation
27 Debarment Currently debarred 21 U.S. Code 335a; To the best of Site s knowledge after reasonable inquiry; Notice duration During the course of the study. Can t be indefinite. X number of years after the close/termination of the study. What is reasonable? 27 March 30, 2018 Title of Presentation
28 Records Maintenance and Retention Site s and Investigator s Obligation to Maintain Adequate and Accurate Records Related to: Disposition of Study Drug/Device; Performance of all Protocol procedures on Study Subjects; Records include: Source Documents; Medical records; Charts pertaining to individual Study subjects; CRFs; Accounting records; Notes; Reports; and Data. 28 March 30, 2018 Title of Presentation
29 Records Maintenance and Retention Site s and Investigator s obligation to retain these documents for the time required by applicable law; Sponsor s obligation to notify Site and Investigator when the regulatory time frames in 21 C.F.R (c) have tolled; Site s obligation to notify Sponsor in writing before destructionof Studyrelated record; Site s obligation to continue to retain records at Sponsor s expense. 29 March 30, 2018 Title of Presentation
30 Records Maintenance and Retention Sponsor s Perspective Maintenance of Records: Sponsor is interested in the recording of the CRFs, laboratory work sheets, and findings in a timely, accurate, complete and legible manner in the form described in the Protocol. Sponsor needs Site and PI to promptly resolve any discrepancies contained in the CRFs, Study Subjects records, laboratory reports, or other raw data sources underlying the data recorded on the CRFs. Retention of the Records: Generally, time period provided by applicable law is sufficient. Sponsor wants written notice prior to destruction. Sponsor wants notice if stored off-site. 30 March 30, 2018 Title of Presentation
31 Records Maintenance and Retention Site s Perspective Watch for provisions that would allow for the copy and/or transfer of Source Documents. Has record retention been budgeted? Is there a system in place to alert the Study Team to notify the Sponsor? Can be difficult to notify the correct person/party if your contact and/or company name has changed over 7+ years. 31 March 30, 2018 Title of Presentation
32 Monitoring and Auditing Allow Sponsor to inspect, audit and monitor: The Study site; Site s facilities; Study Data and associated documents; At reasonable times, upon reasonable notice. Cooperate with Sponsor with respect to such inspection, audits and monitoring visits. 32 March 30, 2018 Title of Presentation
33 Monitoring and Auditing Allow Sponsor to inspect, audit and monitor: The Study site; Site s facilities; Study Data and associated documents; At reasonable times, upon reasonable notice. Cooperate with Sponsor with respect to such inspection, audits and monitoring visits. 33 March 30, 2018 Title of Presentation
34 Confidential Information Site s Perspective Goals: Independent faculty Academic freedom is required to support the medical care of a study subject is necessary to obtain IRB approval of Study or required to be included in the written information summary provided to Study subject(s) and/or informed consent form Need: 34 March 30, 2018 Title of Presentation Clear and understandable definition any information provided by or on behalf of Sponsor or that is generated, discovered or obtained by any Party as a result of the Study (other than patient medical records), including the Studyresults, Study Inventions and information related thereto. MAGI Model
35 Confidential Information Sponsor s Perspective Underlying Considerations: Protect its significant investment Competitive information Preserve patentability Do NOT want site s Confidential Information (IP reasons) UNIFORMITY (Sponsor s do not want to have to read 100CTA s to determine what is and what is not Confidential Information). One difference is Institution must identify what it considers to be Confidential Information at time of disclosure 35 March 30, 2018 Title of Presentation
36 Confidential Information Government institutions CANNOT keep everything confidential due to respective state open public records laws. 36 March 30, 2018 Title of Presentation
37 Inventions Three important concepts with regard to Study Inventions: Inventorship Ownership License In the US: Inventorship = Who actually invented the IP Ownership = Who has right to exploit the IP Can change ownership rights by contract But cannot change inventorship License = Expressly defined rights to exploit IP Exclusive vs. Nonexclusive Geographic Territory Field of Use Outside the US: Varies 37 March 30, 2018 Title of Presentation
38 Inventions Potential inventions resulting from clinical studies: New uses of the study drug (e.g. Viagra most famous and valuable side effect in history) Identification of biomarkers of the drug or disease Methods of administration Dosing regimens Drug combinations New inventions that relate to the Protocol but not specifically to the Study Drug (ex: new diagnostic, end point) Ownership of Study Inventions usually one of the most contentious provisions 38 March 30, 2018 Title of Presentation
39 Inventions Site s Perspective Underlying Considerations: Tax Exempt Status How likely is it that the site will invent something? Goals: Protect background IP and methods Limit definition as a result of or in connection with... Be careful over broadly drafted language Remember: Institutional inventions policies 39 March 30, 2018 Title of Presentation
40 Inventions Site s Perspective Underlying Considerations: Tax Exempt Status How likely is it that the site will invent something? Goals: Protect background IP and methods Limit definition as a result of or in connection with... Be careful over broadly drafted language Remember: Institutional inventions policies 40 March 30, 2018 Title of Presentation
41 Inventions Sponsor s Perspective Underlying Considerations: Significant investment in Study and Study Drug Protect Study Drug and Clinical Trial related IP rights Obtain broadly defined Sponsor IP rights from Site withnonexclusive license to Site s other IP inventions. No intention to reach through or overreach. Remember: Joint Invention rights are uncontrolled To verify assignment of IP rights from Study personnel to Institution. Definitions are key 41 March 30, 2018 Title of Presentation
42 Publication Investigator will submit all proposed publications and presentations to Sponsor 60 days prior to third party submission for Sponsor review Sponsor can require deletion of all Sponsor Confidential Information Sponsor can require delay of up to 30 days to allow time for filing for IP protection If a multi-site Study, Sponsor has right to publish multi-site publication before individual site publications (but no more than 18 month delay) 42 March 30, 2018 Title of Presentation
43 Publication Site s Perspective Underlying Considerations: Tax Exempt Status Academic Freedom Needs: Ensure enforceable publication rights May be limited to data/results generated at Site Reasonable delays: Sponsor review and comment Patent filing Remember: Access to aggregated data and results for multi-center trials? 43 March 30, 2018 Title of Presentation
44 Publication Sponsor s Perspective Underlying Considerations: Appreciate need for academic freedom, but must protect significant investment. For multi-centered studies, sponsor must first publish full results before site-level publications For site publications, Sponsor needs right to review and comment and to identify Sponsor CI to be deleted. Right to further delay Site publication in order to protect Sponsor ability to file patent application. 44 March 30, 2018 Title of Presentation
45 Indemnification and Liability Sponsor indemnifies Institution and Investigator for third party claims caused by: Study Drug/Device when used during the Study in accordance with the Protocol and the Agreement Performance of any procedure required by the Protocol that would not have been performed but for participation in the Study Sponsor s use of the Study Data or Study results or other IP provided by the Institution Sponsor will not indemnify for: Institution or Investigator to conduct the Study in accordance with the Protocol Negligence, recklessness or willful misconduct of Institution or Investigator Breach of Institution s representations, warranties or obligations under the Agreement 45 March 30, 2018 Title of Presentation
46 Indemnification and Liability Site s Perspective Underlying Considerations: Tax-exempt status Public versus private institutions Fairness in risk allocation Institution is carrying out Sponsor s protocol for testing of Sponsor s product Research participant considerations Needs: Protect institution and hospital from liability Ensure broad indemnification (as provided in model CTA) Key phrases: to the extent (avoid all or nothing language) Sponsor s use of Study Data or Study Results March 30, 2018 Title of Presentation
47 Indemnification and Liability Site s Perspective Considerations: failure to not provide prompt notification should not excuse Sponsor from indemnification obligations. Remember: Are hospitals/clinics covered? (affiliate language) No attribution of fault or responsibility to Site in settlements (not covered in model CTA) Deviations from protocol for safety reasons do not negate Sponsor s indemnification duties (covered in the model CTA) Letter of Indemnification may be needed for CRO CTAs 47 March 30, 2018 Title of Presentation
48 Indemnification and Liability Sponsor s Perspective Underlying Considerations: Indemnification allocates risk Indemnification should be limited to 3rd party (subjects, shareholders, etc.) claims Tightly tailor (e.g., directly arising from NOT in connection with ) and address SOC and contributory fault Limit parties indemnified (Why do affiliates of Institution need to be indemnified?) Need to be notified of indemnity claims Consider controlling defense/settlement and ensuring Site s reasonable assistance Lack of Site indemnification doesn t preclude remedies. 48 March 30, 2018 Title of Presentation
49 Insurance Each party is responsible for maintaining appropriate insurance and/or self-insurance for the duration of the Study in sufficient amounts to meet liability obligations under the Agreement, and to comply with law Institution will ensure that the Investigator has medical malpractice insurance for the duration of the Study Each party will provide evidence of insurance to the other party 49 March 30, 2018 Title of Presentation
50 Insurance Site s Perspective Underlying Considerations: Tax exempt status Site policies or practices State law for public institutions Goals: Ensure adequate insurance to support indemnification duties lesser amounts of insurance or no insurance do not excuse Sponsor's indemnification obligations Include coverage for contractual liability and clinical trial activities Remember: Many sites have specific insurance requirements (minimum coverage amounts, types) Self-insurance may be inappropriate if a company lacks adequate resources! 50 March 30, 2018 Title of Presentation
51 Insurance Sponsor s Perspective Underlying Considerations: Insurance deals only with Site s ability to pay when things go wrong. Ensure sites have adequate insurance (e.g., 5 million and above) to address Study related claims. Clinical trial insurance policies covering activities of sites, CRO, IRB, etc. can further mitigate risk. Remember: Although insurance landscape is quickly evolving, insurance generally does NOT cover intentional acts Insurance does not define scope of liability Contract with institutions not individuals 51 March 30, 2018 Title of Presentation
52 Governing Law The model remain slient 52 March 30, 2018 Title of Presentation
53 Governing Law Site Perspective Underlying Considerations: Institution policies or practices State law for public institutions 53 March 30, 2018 Title of Presentation
54 Governing Law Sponsor s Perspective Convience 54 March 30, 2018 Title of Presentation
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