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    A matter of time: Managing life sciences risk and expectations post-pandemic

    Derek Dow, Underwriter, Miscellaneous Medical & Life Sciences

    The Covid-19 vaccine rollout in Canada has rapidly gathered pace after a relatively slow start, with both the number of doses administered per capita and those who are fully vaccinated now exceeding the United States.1 With 70.7% of the country’s population now fully vaccinated,2 Derek Dow, Beazley Healthcare Underwriter, considers how the pandemic has changed the risk landscape for the life sciences industry.

    The development of COVID-19 vaccines within a year of the virus’ emergence was a huge accomplishment for the life sciences industry, which had to navigate myriad evolving risks, accentuated by the pressure to move quickly and help end the pandemic. In its supporting role, the insurance industry has also had to pivot quickly, deploying risk management expertise to develop bespoke wordings that provide protection to organizations involved at each stage of vaccine development.

    What life sciences organizations have achieved under an intense spotlight in such a short space of time may transform their sector in the longer term, particularly now the public, investors and governments alike have seen the bar raised to unprecedented levels in response to the crisis. Being the first to market with a successful vaccine brings huge financial and reputational gain to pharmaceutical companies as well as risk. Pressure to expedite the process raises the stakes higher and increases pressure on those involved to get it right the first time.

    To put things in perspective, the mumps vaccine, previously considered as the fastest to be developed, took four years, while the first COVID-19 vaccines took less than 12 months. However, despite what we have learned about the behavior of viruses and immunology in the last 200 years, there is no guarantee that any project will produce an effective vaccine. Getting a vaccine to market comes through extensive research, clinical trials and regulatory review as part of a process that takes 10 to 12 years on average, with a high risk of failure. In the last 20 years only 39.6% of vaccine projects have resulted in a drug being approved to go to market, according to The Massachusetts Institute of Technology, while only 26 diseases are preventable through vaccination.3

    Trials and testing

    Testing the safety and efficacy of a vaccine requires robust pre-human trial research, which can easily take two years in normal circumstances. Before moving to human trials, the sponsor or investigator must get approval from both Health Canada, which authorises clinical trials and approves new medicines and devices for use, and a research ethics board.

    Failure to prove that the proposed trial meets these standards could mean revising trial protocols or starting the process over with a back-up candidate costing time and money, potentially losing first-to-market advantage.

    Human response

    Several factors contributed to the incredible speed of development for Covid-19 vaccines, including the experience of dealing with MERS and SARS as well as the use in some vaccines of mRNA technology (instead of using a traditionally weakened version of the live virus), which has been studied by scientists for decades, and used in cancer research to target specific cancer cells.

    However, the rollout of multiple COVID-19 vaccines in record time driven by the collective efforts of the global life sciences community, health leaders and governments also required public reassurance to alleviate concerns around reducing the research phase and how to mitigate the potential impact of this on human trials. After all, information learned during research and planning forms the basis for human testing. While human trials inherently carry risk, this can be mitigated through proper trial design and ensuring that rigorous protocols are in place for the duration of the trials, including ‘learn and confirm’ cycles to address any variance from anticipated results. Upholding these standards reduces the potential for human error that can lead to bodily injury and claims against those running the trial.

    Risk mitigation

    As part of the pandemic response, Health Canada was able to fast track vaccine approval thanks to its ‘interim order’ process, which means rather than waiting for the trial to be completed, and a full data set to be sent for review as would normally be done, new evidence of safety and efficacy is reviewed as it comes available. However, approval is only given when sufficient evidence has been received which shows the vaccine is safe, effective and good quality. A similar process was used during the 2009 H1N1 influenza pandemic to explore potential vaccines and treatments.

    Looking forward, the life sciences sector, and regulators, may have to balance how to manage expectations with how it will operate when ‘normality’ resumes both in terms of what is reasonably possible to deliver safely and compliantly and in terms of the regulatory framework.

    Health Canada recognised this dynamic when it announced the regulation of clinical trials and the approval of new medical products will be reviewed as part of the government’s regulatory innovation agenda,4 which aims to support innovation and development through a more flexible, agile regulatory process.

    Despite the strength of the Canadian regulatory regime, human error during clinical trials can still lead to financial losses or injury to participants. Robust risk management and having specialist insurance in place in case claims arise is therefore of paramount importance.

    Failure to properly monitor the trial raises the potential for claims arising from bodily injury to trial subjects. Although there is no legal requirement in Canada for the trial sponsor to be insured against bodily injury, Health Canada guides sponsors to obtain insurance. As many trials take place abroad, and the type and level of insurance requires varies by jurisdiction, sponsors should seek advice from their insurance broker on what is required in the jurisdiction where they are conducting trials.

    A contract research organization (CRO) may also be required to carry insurance as part of its contract with a trial sponsor or be the recipient of suits. Claims could arise if the CRO fails to adequately warn the participants about the risks or obtain informed consent forms; providing clear information is critical to participants’ decision over whether to volunteer in a research study. Problems in the running of the trial could bring legal action against CROs from sponsor corporations if they claims that delays have caused them financial loss or forced them to start again with another candidate.

    1 07.17.21 BBC Canada's vaccination rate overtakes US - BBC News 
    2 08.11.21 Vaccination Tracker (COVID-19 Tracker Canada - Vaccination Tracker (
    3 May 2020 ‘Estimating probabilities of success of vaccine and other anti-infective therapeutic development programs’, NBER Working Paper No. 27176

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