Clinical trials and sanctions in relation to Regulation 2014/536, national rules, and contract standards

The European rules on drug trials do not include provisions for sanctions, but instead leave it up to Member States to outline an effective sanctioning framework. Recently, Regulation (EU) 2014/536 (“Regulation”) in Article 94 provided that “Member States shall lay down rules on penalties applicable to infringements of this Regulation and shall take all measures necessary to ensure that they are implemented.”

In Italy, sanctions in this area—without prejudice to conduct that may constitute a crime—are outlined in Legislative Decrees No. 211/2003 (Article 22) and No. 200/2007 (Article 41). These set forth both pecuniary sanctions and sanctions involving suspension of trial activity that may be imposed by the AIFA in its role as the authority with jurisdiction pursuant to Legislative Decree No. 52/2019 (Articles 1 and 2).

While Legislative Decree No. 200/2007 was issued in implementation of Directive 2005/28/EC, which is still in force, Legislative Decree No. 211/2003 was adopted in implementation of Directive 2001/20/EC, which was expressly repealed by the Regulation, as provided in Article 96, and remains applicable only in certain cases. Therefore, it remains unclear what will happen to the administrative sanctions contained in Legislative Decree No. 211/2003—and there are many of them.

To date neither the legislature nor the authority has acted on this point. This was also the case for medical devices, first with the Circular of the Ministry of Health of November 12, 2021 and then with Legislative Decree No. 137/2022, which took effect on September 29 of this year. Also, the European legislation—Regulation (EU) 2017/745—repealed the previous EC regulation in implementation of which the national one had been adopted. Among other things, that contained sanction provisions. However, in the abovementioned circular, the Ministry clarified that the rules contained in the decrees implementing the repealed European rules, including sanction provisions, were to be considered still applicable until the legislature took action, so long as they were not incompatible with the Regulation. With Legislative Decree No. 137/2022, the legislature also redesigned the system of sanctions for breaches of the rules set forth by the Regulation.

National sanctions following application of the Regulation

In the first place, the repeal of Directive 2001/20/EC by Article 96 of Regulation (EU) 2014/536 has to be reconciled with the transitional regulation provided in Article 98 of the Regulation, which on the one hand allows sponsors to submit applications for authorization of clinical trials on the basis of the previous legislation until January 31, 2023, and on the other hand dictates that in any event trials already undertaken in accordance with the Directive may remain governed by it until January 31, 2025. In other words, Directive 2001/20/EC (and the relevant national implementing provisions) will continue to govern certain trials, and therefore the sanctions provided in the relevant implementing provisions—in Italy, Legislative Decree No. 211/2003—may also be considered still in force and applicable.

However, absent any indication from the legislature and the ministry, there is the question of which sanctioning framework applies to trial applications submitted pursuant to European regulations. In a scenario that echoes the case of medical devices mentioned above, in this case the sanctions provided to date by Legislative Decrees No. 211/2003 and No. 200/2007 are still applicable to the extent that they are compatible with the Regulation.

Although even this view is open to criticism from a legal perspective, a different interpretation would lead to paradoxical and discriminatory outcomes by making the same conduct punishable or not punishable depending on whether the application for trial authorization was submitted under the previous regulatory framework or the new one. Obviously, that would be an untenable scenario.

Criminal offenses and the importance of controls and preventive measures

The national sanctions framework outlined above preserves liability for conduct that may also constitute a criminal offense. There are various criminal offenses that could arise in the abstract in the context of conducting a trial, such as offenses involving the public administration, e.g., bribery and extortion, in particular in relations between the sponsor and the authority or ethics committees. Offenses related to false declarations by the sponsor in dealing with the administration at the application stage also offer fertile ground in this area.

In this regard, adopting adequate controls and safeguards aimed at preventing the commission of offenses is certainly of paramount importance for both companies and public bodies. Article 13 of the trial contract template available on the AIFA website and prepared by the National Coordination Center of Ethics Committees expressly requires the parties to “comply with the anti-corruption legislation applicable in Italy” and specifically requires public bodies to adopt the Three-Year Plan for the Prevention of Corruption and private companies to adopt “supervisory and control measures” for the purposes of compliance with and implementation of Legislative Decree No. 231/2001.

By virtue of this provision, the adoption by the sponsor and/or CRO of an organization, management, and control model (known as Model 231) is not in itself compulsory under the law, but it is a necessary element for the conduct of clinical trials, considering that the law (Article 2, Law No. 3/2018) requires the use of the new contract standards.

As further evidence of the importance of this issue, the contract standards stipulate that violation of the provisions of Article 13 constitutes a serious breach and allows the other party to terminate the contract pursuant to Article 1456 of the Italian Civil Code. Moreover, considering that the use of the new contract standards is required by law, it could be argued that failure to adopt Model 231 is in violation of a mandatory rule of law, and therefore the relative contract is, in whole or in part, null and void pursuant to Article 1418 et seq. of the Civil Code.

A practical question that arises with reference to Article 13 of the contract standards concerns cases in which the sponsor (or CRO) is not a company created under Italian law and therefore does not have a Model 231. The contract standards have an underlying legal basis, and optimally are not modified unless the specifications and makeup of a trial require it (meaning they have the same recitals as the model contract).

In these cases, a solution could be to justify the change to the standard—as required by the recitals—by outlining the company’s compliance with rules in a foreign legal system that are analogous or similar in content and purpose to the national rules requiring adoption of Model 231.

Leveraging the possibility of modifying the standards to adapt them to specific situations could also be a way to deal with a situation in which a sponsor does not have a Model 231, given that, as indicated above, the adoption of such a model is not mandatory under the law and introducing this obligation through a contract standard may be questionable. In this case, the issue would be subject to negotiation between sponsor and test center.