We are delighted to present a special episode from Altea Insurance's acclaimed podcast series, 'Altea Talks.' In this insightful discussion, Simmons & Simmons Partner, David Kidman, joins host Will Marshall, Head of Legal & Risk Management at Altea Insurance, to explore the intricacies of product liability in the healthcare sector. We extend our gratitude to Altea Insurance for sharing this episode with us, allowing us to share this expert content to our audience.
We hope you enjoy the conversation and gain valuable insights into the legal landscape affecting health and care providers today. Please contact David or Will directly if you have any questions or would like to find out more.
Introduction to Altea Talks season two
Welcome to this second season of Altea Talks, the dedicated podcast brought to you by Altea, the unique provider of combined insurance and risk management solutions designed exclusively for the medical, allied health, and care sectors. I'm your host, Will Marshall, and I'll again be joined in this second series by some of the leading figures from across the sectors. My guests are going to include practitioners and professionals, regulators, clinical risk and governance specialists, and an array of legal experts who are going to help us get to the heart of the hottest topics affecting health and social care sectors today. So if you're looking for frontline knowledge and expertise, if you want valued insights into these most dynamic, challenging, and rewarding sectors, then look no further because you're in the right place.
Introducing David Kidman: A leading product liability lawyer
Welcome again to Altea Talks. Hello and welcome to this latest episode of Altea Talks. I'm delighted this week to be joined by my former colleague, David Kidman, who is one of the UK's leading product liability lawyers. David is a partner at global law firm Simmons & Simmons, where he specialises in product liability and regulation. He works for healthcare professionals, life sciences manufacturers, and insurers. David is ranked as a leading partner by Legal 500 in product liability for defendants, making him one of the top lawyers in this area in the UK. David's life sciences expertise includes advising clients in relation to spinal disc implants, surgical knives, experimental stem cell treatment for cerebral palsy, and pathology reporting for cancer treatment. David led the defence of the PIP breast implant group litigation, where he acted for the lead cosmetic surgery clinic and its insurer. He has advised healthcare clients on tussles with the MHRA on recalls, contaminants, and cosmetic products, and the social media storms kicked up by some of his competitors about his clients' products.
Understanding product liability in the UK healthcare sector
David, a very warm welcome to Altea Talks.
Thank you, Will. That's a really glowing introduction, so I'm really grateful for that. Always a pleasure, David. David, I thought we would start off this conversation where we're going to be talking about product liability issues for UK-based health and care providers with a bit of a focus on the aesthetic sector in 2025, which started off, if it's OK, with an introduction for the listeners to the legal and regulatory framework surrounding product liability law. And I think my first question is, if you could explain how product liability is currently defined under UK law and how it specifically applies to health and care professionals, particularly those working in the aesthetic sector.
The origins of product liability law and its application to healthcare
Absolutely. Thanks, Will. I think you're tapping into my latent desire to be a university professor teaching this sort of thing. So it's quite simple in a sense in that when you're looking at what is product liability law in the UK, it's important to note that that directive and our Consumer Protection Act were significantly influenced and came into existence because of, in large part, the Thalidomide tragedy being a medicine. And that was a catastrophic event in the late 1950s and early 1960s where the drug thalidomide, which was used to treat morning sickness, resulted in over 10,000 children worldwide being born with severe birth defects. That tragedy underscored the need for really stringent regulatory controls and accountability and strict liability over manufacturers and those involved in the supply chain, and I'll come on to talk about what strict liability means in a minute. So that really demonstrates that the life sciences sector and the healthcare sector was a key driver in the creation of product liability laws, and I think that's an important point to be mindful of. I think when you look at healthcare professionals, for example, in the modern day, particularly in the aesthetics sector, that translates to a responsibility really to ensure that the products they're dealing with such as Botox or dermal fillers or medical devices are safe, properly labelled, and compliant with relevant standards. It's really important to also understand the information and warnings that come with the product they use and to convey that to the patients. So that all fits really under the product liability laws and the sort of sweeping obligations that a healthcare professional has.
Responsibilities across the supply chain
Thank you. It's very, very helpful background. I think one thing that always strikes me about this area of the law is that there is a chain of interested parties whenever a medical product is used in patient care. And I think it would be very helpful if you could share with us what the respective responsibilities are for the various people within that chain. So the manufacturer is the distributors and the healthcare professionals themselves when a defective medical product is used in patient care.
Strict liability and the role of manufacturers, distributors, and healthcare professionals
Absolutely, well, so it's quite important to recognise that as you go down the supply chain from the manufacturer to a distributor to perhaps a local distributor down to perhaps the healthcare professional who is using and administering the product, inevitably the level of knowledge of that product and its safety diminishes because you are less close to the manufacturing, the design, the testing etc. I think that's an important point at which I should explain what I mean by strict liability then under product liability law because it's really important to recognise that even if you lack knowledge about the product you be a healthcare professional who's imported a dermal filler from the Far East, for example, and so you don't have as much knowledge about it, you are nonetheless strictly liable if that product is defective and causes harm. What that means is that if it causes harm, it's no defence for you to say I did not know this product was defective, I did not realise. So that's quite an important point points bear in mind that permeates through the whole supply chain. But if I come to your question let me just map it out step by step. So a manufacturer of course at the top of the supply chain has a sweeping range of responsibilities. That includes designing and producing and testing products to make sure they're safe and providing clear instructions and warnings and then ensuring that as the product is on the market they are vigilant in terms of monitoring for adverse side effects and reporting potentially to relevant authorities. When you go down a level to distributors, they still have substantial obligations. They have to ensure that the product is safe because they bear strict liability if it's not. And they may have, while the product is in their own hands, their own obligations of storing it correctly, for example, under temperature control and transporting it in a way that ensures its integrity and safety is maintained. Then we go down to healthcare professionals, and I think we're going to explore this in a bit more detail anyway, but of course it's really important for healthcare professionals when they're purchasing these products and getting into the supply chain that they are taking care and exercising due diligence to select safe products. And I'm sure we will talk a bit about how do you do that in practice, but they do have their own obligations. They also have their reporting obligations if they become aware of adverse events, for example, and obligations to pass on to patients, information, instructions, warnings, etc.
The impact of Brexit on product liability laws
Thank you. You mentioned earlier the dreaded B word, and obviously Brexit has had an impact on this area. How has the UK's departure from the EU affected product liability laws for medical devices and pharmaceuticals?
Yes, good question. And let's tackle the dreaded B word. So Brexit has inevitably meant that the UK has had to establish its own regulatory framework for medical devices and pharmaceuticals separate from the EU. But it's important to recognise that the UK hasn't generally diverged that much from the EU in terms of the regulations that products must adhere to or the safety thresholds, for example. And indeed that lack of divergence is echoed in various other sectors like automotive, food and drink and consumer electrical. So we have let's say a similar but different system, different in appearance but similar in substance. Now it may be that over time the UK does diverge a bit more from the EU and develops its own compliance requirements and product standards and that can then have a complicating effect on cross-border trade, for example making it harder to bring in products and place them on the market here if they've also got to adhere to a second set of standards. But with all that said, that's not really the direction of travel that we've been seeing. So the UK government introduced the UKCA mark for various products as a replacement for CE marks. Now that UKCA mark doesn't apply to pharmaceuticals, but it applies to medical devices and various other products. You'll have seen it on things like Barbie dolls and mobile phones and various things. But the UK government climbed down from that position, and it has said that for many sectors it will now recognise the CE mark indefinitely. So that's a bit of a curious position for the UK because it is accepting that European standards are good enough if a product has a CE mark, it is good enough and safe enough for the UK market. But the UK's lost it standing in being able to influence those regulations and standards because of Brexit. Now for medical devices the government has not said it will recognise the CE marking definitely but it will do so until 2028 or 2030 depending on the type of medical device. It may be that that date is extended but for now we do have a slightly different regime to comply with for medical devices and marking and similarly with pharmaceuticals, if you could explain in what circumstances healthcare professionals are most likely to be at risk of personal liability for harm caused by defective products that they're using?
Personal liability risks for healthcare professionals
Of course. So I think it's worth mentioning the pit breast implant group litigation as a good example of this and That was a case where most of the claims were against cosmetic surgery clinics who were the suppliers and Implanters of the implants But various healthcare professionals various surgeons were in the supply chain in a range of cases They were the ones who purchased and supplied and implanted. And that group litigation saw a number of healthcare professional surgeons being sued personally and directly alongside the cosmetic surgery clinics. And that emphasizes the fact that you have strict liability for product defects if you are supplying them. So care needs to be taken there, but when we look perhaps more broadly at what healthcare professionals should be mindful of. There are obligations, for example, to take reasonable care in terms of selecting the products and vetting them. So making sure that if they're using products that perhaps it's the first time they've purchased them, running due diligence on the vendor, understanding what documents exist to prove the safety and the efficacy, and understanding what information needs to be passed on to patients so that there is informed consent about what they are signing up to when they have those products applied to them. And it's really important as well that even after you've supplied implanted etc to the patient you are vigilant as a healthcare professional, really important that you monitor for adverse events. So if there is a recall for example published by the MHRA and it involves a product that you have applied then it's important to be aware of that and to act promptly. So there is a real risk there in a range of different ways and a real importance to be vigilant throughout and that risk of course of a liability for the unexpected drives the need for insurance and I know insurance is dear to your heart's will. So of course medical malpractice discover and product liability cover are your two go-tos to protect yourself in the event that you become entangled in a product liability dispute?
The role of the MHRA in product safety
Yeah, thank you. It's interesting. I have certainly seen in the course of my legal work, this issue of strict liability arising, not regularly, but it can be a bit of a recurrent featuring claims where a clinic is operating under a practicing privileges type arrangement. So the individual doctor is an independent practitioner, carries his or her own insurance cover, but the clinic supplies the implants and the devices that the doctor is using. And so In those circumstances where the clinic might say actually it's a matter for the doctor, the clinic is responsible for providing those materials and that presumably raises a potential liability for the clinic.
Yes, absolutely. So you can have that tripartite dispute where you have the clinic and the surgeon and the patient. And of course in circumstances where the clinic and the surgeon generally want to get on well with each other and not have their contractual arrangements aired in public, it's undesirable to have, for example, litigation between the patient, the surgeon and the clinic, and a dispute between the surgeon and clinic as to who actually, in fact, contractually supplied the product, who is responsible and liable for it if it's defective. So it's definitely important to iron out behind closed doors that arrangement between a con surgeon so that you're not airing it in public in front of the patient or if it's in litigation, it's in the public domain.
Conducting due diligence on the supply chain
Yeah, of course. You mentioned the MHRA. What role do UK regulators such as the MHRA currently play in shaping the standards and expectations around product safety and clinical settings?
So we have the MHRA to thank in a number of ways in this area in protecting public safety. And although you kindly introduced me and referred to tussles with the MHRA, and absolutely, that's part of my job to protect defendants. In fact, we do have the MHRA to thank for being a really active vigilance regulator. And it was the first regulatory body in the world to approve the Pfizer COVID-19 vaccine for emergency use in December 2020 in the whole world. And it does play a critical role in monitoring the safety and efficacy of medical products, including medicines and medical devices. It has a crucial mandatory role in determining whether a product can be placed on the market and awarding licenses to bodies to be able to do that. But also for the ongoing vigilance requiring all sorts of supply chain entities to be vigilant, monitor for adverse events and report adverse events. And it also issues safety alerts and recalls for defective products. So that provides a wealth of guidance to healthcare professionals on safe practices and whether products are safe or not. So it's really important as a healthcare professional to frankly regularly go on the MHRA's website to sign up for circulars to tap into that knowledge because it is a good vigilance regulator.
Practical steps to minimise liability exposure
Thank you. So we've talked about some of the risks faced by healthcare providers, both individuals and entities. And I think it would be helpful now, David, if we could just move the conversation on to look at some of the types of due diligence that a healthcare provider ought to be carrying out on the supply chain for the products that they acquire?
Yes, absolutely. So, to a degree, there's a divergence here between where you would look if you're dealing with a medicine or pharmaceutical product as compared to a medical device. And, for example, dermal fillers are classed as a medical device. And we have, and I think it was a topic that we'll discuss a bit more detail later, we have unregulated products. But if we focus, for example, on medicines for now, they don't have their own CE or UK CA marking regime, but the MHRA will vet those products before they're placed on the market, and the MHRA will be a good source when you're conducting due diligence, good source of information as to whether that product is safe or not. And of course, whether there have been any adverse events post-placing on the market. With medical devices, the MHRA has a similar role, but you probably have another way in which you can gather relevant information for due diligence because you will typically have a third party notified body or approved body awarding the CE or UKCA mark. And most of those bodies on their website have the ability to click through and determine that they validly awarded the CE or UKCA mark. And I think it's quite important to not just take as read that because that mark was awarded, it must mean the product went through proper channels. We saw in COVID, for example, looking at a slightly different type of product, we saw face masks being very opportunistically put on the market in droves by less reputable suppliers and fake certificates showing CE marks being awarded. So it is important to do a bit of due diligence just to check the provenance. And we do have, particularly with a lot of aesthetic products, a number of suppliers out of jurisdiction who perhaps may not be as reputable as others. So it's really important to tap to those sorts of sources of information. And I appreciate that's a lot for a small beautician's practice, for example, as these are quite complex and technical exercises, but I think it's a bit like investing the time in getting your dishwasher fixed or filing your tax return. It's probably the best time you've ever invested in something. So it's really important to do the due diligence there.
Staying up to date with recalls and safety alerts
Yeah, thank you. And you've talked a bit about this already, but are there any specific practical steps in addition to the due diligence that healthcare professionals should be taking when buying, prescribing, handling, administering clinical products to minimise their exposure to liability?
Yes, absolutely. So aside from looking for the sorts of records we've just discussed, I think that Record keeping in general is important, so making sure you've got accurate and detailed records of your product purchases, who you purchased from, and the way in which you're using them, are you making sure that what you're using is still in date, what's your system for ensuring that, and recording patient outcomes. Was the surgery successful, for example? Was there any feedback on whether the product performed as expected? It's also really important to make sure that any instructions and warnings that come with the product that you're administering are fully understood and if there's something that's unclear or causes a concern to raise that with the person you've purchased from and ensure that any adverse side effects etc are clearly passed on to patients to ensure informed consent. And then it's really important as we've discussed to keep on top of whether there are any product recalls or safety alerts in relation to that product and ensuring that you're devoting a bit of resource to regularly monitoring and responding to that sort of information and not to be afraid to have discussions with the MHRA or other bodies if something is unclear or you're a bit concerned. And then internally tapping into training and education opportunities to make sure that that you and various others in your organisation are understanding of product safety and regulatory compliance.
Systems for monitoring recalls and safety updates
Thank you. You mentioned there about the importance of staying up to date with things like product recalls, MHRA alerts, safety updates and so on. What systems would you ideally like to see in place to ensure that this is, well Firstly, happening reliably, but also is being recorded.
Yeah, so it's important to tap into the wealth information that is floating around in the UK. So what do I mean by that? Well, first of all, the MHRA website has the ability to subscribe for updates and alerts. There are various professional networks around the country and forums that you could tap into and various training sessions and conferences that you might be able to go to and embedding that as a regular and pervasive practice of your business is crucially important. That helps to ensure that if there is a problem with a product that you are buying or be thinking of buying, you're aware as rapidly as possible of a potential risk. And for example, there was a beauty clinic in London a few years ago that was found to be using counterfeit Botox in its treatments. And the counterfeit product was something that the clinic hadn't spotted. They didn't realise it was counterfeit. They weren't tapping into the sources of information that could have told them that. And unsurprisingly, they faced substantial fines and legal costs that came with regulatory investigations against them, as well as civil claims and damage to reputation. So it's really important to keep your finger on the pulse. It's really important also to be vigilant when you have administered products to monitor for adverse side effects, to have that dialogue with your patients to ensure they're satisfied, not just from an efficacy perspective, but from a safety perspective.
The duty of care and its extension to product vigilance
It's interesting, it's almost an extension of the duty of care, isn't it?
It is absolutely. I mean, this is leaving aside the strict liability points, but when you do look at negligence and whether you've taken reasonable care, you absolutely will be expected to have taken the level of care that is required of someone someone in your position and you're expected to have a certain degree of knowledge and information and if that knowledge and information is relatively easy to gain, then you're going to face criticism if you are not taking advantage of those sources of information and understanding and acting on them.
Protecting against liability through robust contractual documentation
And you mentioned earlier when we were talking about the importance of having very clear contractual documentation with colleagues and with patients. To what extent can health and care providers protect themselves from liability in the event of harm being caused by a defective product through robust contractual documentation?
Yeah, good question. And I think it's important to split that into two. So, looking first of all stream at the documents and the contract you have with the patient and then looking upstream at the contract you have with your supplier, assuming you're in that role of healthcare professional buying from someone else. So if you look downstream, first of all, it's important to recognize that you cannot generally contract out of liability if you cause harm or death to a patient. So you're very limited and probably quite rightly from a public policy perspective from limiting your liability in that sense. So where that really leaves you is making sure that quasi-contractually you are passing on relevant information, relevant warnings to your patients, so that if it were said, for example, that you didn't tell them about a particular adverse side effect, if you have a clear correspondence chain at least showing that you did or a note of a meeting in which you conveyed that and that is very helpful to you to protect yourself in that circumstance. When you're looking upstream at the person that you are purchasing from you've got a lot more ability to shape who bears the liability so you would want for example ideally some sort of indemnity clause in your favour which means that if a product is defective, although you might be the one sued by the patient in the first instance, you are able to get an indemnity, a payment from the supplier if you can establish that that product was defective. So that's really important. Now conversely, your supplier might be seeking to limit its liability to you, which sounds very unfair. So you've then got to think about the balance of power. How much negotiating power do you have? And of course, if you're a relatively small practice and you're contracting with a global supplier of products in the life sciences and healthcare space, you may have difficulty doing anything other than accepting their standard terms. But I think information and knowledge and awareness is power, at least understanding that that is your contractual position is really important when you're contracting with them?
Legal responsibilities of influencers promoting products
Thank you, yeah. We touched very briefly earlier on the unregulated scenario. So looking at providers who are unregulated and products that are unregulated, maybe if we take those in turn, so look at the providers first. What legal responsibilities do people such as beauty Influences in the UK have when promoting cosmetic or wellness products, especially those that are unregulated and are borderline medicinal.
Yeah, that's an interesting topic when we're talking about influencers. And I'm going to assume that when we're talking about them, we are not treating them as an agent of the supplier. They are not contractually binding or making representations on behalf of the supplier that are legally binding. No, I think it's more that they are maybe promoting a product or endorsing a product with their service users or customers. Yes, absolutely. So when we look at that sphere of influencers and it is a sort of relatively modern phenomenon, it is really important to understand perhaps the limitations of liability that influencers have and although it's not as good as Altea's series of podcasts There was a really good Netflix series about the fire music festival Which was completely overhyped and mis-marketed by social media influences who had really no idea what they were marketing And when that festival turned to be an absolute failure with numerous safety issues a number of influences were sued But I don't believe any were held liable So, although that's a bit of an aside, and we're getting a little bit off topic from the healthcare sector, if influencers can persuade tens of thousands of people to pay thousands of dollars to fly to the Bahamas on a wing in a prayer, then they can certainly influence people to make bad choices about beauty products. So when we look at the influences that are operating in the UK in the beauty sector, Although they do have legal responsibilities to ensure that the claims they make about cosmetic or wellness products are truthful and not misleading, and obligations to ensure that they comply with advertising standards and consumer protection laws, in reality it's very difficult to actually pin liability on an influencer. So in theory, yes, you could have a valid claim against an influencer, but in reality, there's just not a prevalence of litigation that's successful against influencers. And I think that you'll find that, unlike doctors, for example, who have to carry compulsory med/mal insurance, influencers have no obligation to have insurance, and they don't necessarily have many assets to their name. So the ability to actually sue and enforce against them is pretty limited.
Risks of using unregulated products
Thank you. And what about Regulated products. Is there a greater risk, presumably, there is for healthcare professionals if they're using unregulated products?
Yes, absolutely. So where we've talked a bit earlier about regulated products and the relative wealth of documents and information that you might find, for example, on the MHRA's website or on the website of the body that awarded the CE mark or the A mark. Unregulated products just don't have generally that body of information to tap into to verify that the product is safe and so for example we saw an unregulated skin lightening cream recently causing a lot of issues. Now those issues for most people were skin rashes and irritation, uncomfortable but not disastrous but some people had suffered more serious consequences because there was an unintended presence of mercury in those creams and that has then caused issues such as kidney conditions. So that then has led to the MHRA and other government bodies inevitably probably feeling quite frustrated about these sorts of products getting on the market and putting out medical alerts to spread awareness of this. So I think if you're a healthcare professional and you're dealing with an unregulated product, you really have to double down on the due diligence you're doing with the vendor, really pressing for documents and information. And if you feel that it is not a safe product, that it doesn't quite seem right, that things are being withheld from you, or that documents don't exist where you feel that they really should to verify safety, then you have to be really careful about taking on board that product and bearing a potential strict liability for it. And I think I'd just add to that you need to be very clear about what your insurance covers you for as well, because some insurance policies will have conditions in them that require you to vet the products that you're using, or at least to have certain standards around them.
Common types of product liability claims in healthcare
Thank you. We've talked a bit about the potential liability and the very real risk of liability for health and care professionals in product liability claims and the need for them to have medical malpractice and product liability insurance cover. Can you just explain a bit for us now about the types of claims that health and care professionals could face? So what are the most common types of product liability claims that health care professionals could become involved in either directly or indirectly?
Yes, so let's start with looking at the more serious end of the scale and when I say serious, I'm talking perhaps more about the major class actions or group litigation we've seen in the UK and those sorts of actions have involved products like the MMR vaccine, hip implants and breast implants and often that litigation involves hundreds or indeed thousands of patients pursuing claims together and often backed up by a major claimant law firm with relatively deep pockets to pursue that litigation and also litigation funders in the background where they see a prospect of success and costs towards and a pay-out ultimately to them. And the PIP breast implant group litigation as we've touched upon that included as defendants not just the cosmetic surgery clinics but also the individual surgeons. When we look at the perhaps more day-to-day end of the scale, there are still a range of aesthetic and cosmetic products where litigation occurs and even if it doesn't actually go to litigation, i.e. matters in the court, there are plenty of claims about where, for example, there might be a contaminant present in a cosmetics product or a lack of quality control during manufacture or inadequate storage so that the ingredients are compromised. Those can all lead to potential strict liability for the healthcare professional. Now, there's often a bit of a blurring of the line as to what the cause is. If, for example, a Botox treatment does not give the result that the patient expected and has led to a deterioration aesthetically for that patient. Often you have two allegations running parallel. First is that the product was defective. And secondly, that the healthcare professional was negligent in the way that they administered the product. And unpicking which of the two it is, or neither, of course, ideally, for defendants, is quite difficult. And in many cases, you'll never know the true cause. So I think it's really important to be mindful of those two strands and obviously to try not to get entangled in that sort of litigation.
The evolution of class actions in the UK
Yeah, thank you. And you mentioned about class actions. How Are class actions or group litigation orders evolving in the UK in the sort of high profile cases involving widespread product use?
So here it's a good job that we're not talking about the EU because we're seeing in the EU the first opt-out product liability class action unfolding in the Netherlands against an implant producer. Now what I mean by opt-out is that everyone is included in the litigation if they satisfy the criteria, so they don't have to expressly sign up to be a claimant in that litigation. And that class action in the EU is allowing people from multiple member states, not just the Netherlands, to be part of that class action. So that is the position in the EU, but coming to your question about the UK, fortunately for healthcare professionals in the UK, we don't have an opt-out class action system for product liability claims yet. So a number of class actions in the UK for product liability, including vaccines and hip implants, relatively recently, they've all been opt-in, so claimants have to expressly sign up to them. That helps to moderate the numbers of claimants that are pursuing the matter. And I think it's also important to note that in the UK, there's been a number of recent court judgments which have essentially seen the claimants fail to succeed in their claims for product liability actions involving pharmaceuticals or medical devices. So we've got a pretty defendant-friendly regime at the moment for product liability claims in this sphere, and that has dampened the appetite of claimant firms and litigation funders to prop up that sort of litigation, at least en masse. So a relatively favourable environment for now in the UK.
Claims for psychological injuries and subclinical anxiety
What about looking at other claims trends that we're seeing in this area? Are claims for psychological injuries such as subclinical anxiety caused by exposure to defective products, are those sorts of claims becoming more common? And how are the courts treating these types of damages claims?
So I would say that the short answer to your question are they becoming more common is no, they're not. Now, well, what I mean perhaps by that is the courts aren't being any more generous in allowing such claims through. But I think it's right to split the answer out into three different types of claims. So firstly, if you suffered a physical injury, so for example, from a contaminated blood product, but you're also suffering psychological harm, you're distressed, you're anxious about the fact that you've had that injected into you, then that's recoverable. And there's no real concern or quandary about that in the courts. That psychological aspect is recoverable as damages on top of the physical injury damages. Secondly, if there's been no physical injury, but you have a recognised psychiatric disorder, such as PTSD, then that, as long as it is a recognised disorder, can be compensatable. But I think going probably to the heart of your question where you've got subclinical anxiety but you haven't got a physical injury that's where the courts are still pretty robust in favour of defendants in the UK. So that sort of claim is generally not recoverable and the courts here are pretty resistant to opening the floodgates and in PIP we had a range of claimants who we called the worried Well, those were the ones who had implants. They knew that there was a greater risk of rupture, but they hadn't suffered a rupture. So there was no physical injury. They were just very worried. And so that is a feature that does come up relatively commonly. I think there's quite an interesting public policy approach to this in the UK. And if I may, for a minute, just give a couple of illustrations of quite colourful cases. Forgive me were stepping outside the realms of healthcare and life sciences, but it shows quite well how the courts treat this as a public policy aspect. So there's a case of Riley and Merseyside getting back to 1994. You had two individuals trapped in a lift for an hour and 20 minutes, not very pleasant. And Mr Riley was claustrophobic. He became hot and sweaty, struggled to breathe, felt dizzy. And the court basically said that, well, These sorts of feelings are just normal emotions, they're not injuries and we can't go around awarding people money each time they've experienced that sort of unpleasant situation. And then also, and I find this quite a colorful one, this is the US, 1968, a manufacturer of a bathing costume was held not liable to a claimant who suffered humiliation, mortification and embarrassment when that costume became parents when it became wet. So I think those give a good illustration of why courts don't generally award damages for subclinical anxiety and distress. They're just part of modern life.
AI and digital products in healthcare
Of course. And David, I'm conscious of the time, but I do feel that no podcast on this topic would be complete without looking at the interaction between AI and digital products as used as medical devices. So if we may, let's turn to the topic of AI and how it intersects with product liability in medical devices. I know that your law firm Simmons and Simmons leads the market in AI and has a tier one ranked AI department. I also understand that you have a separate Cambridge and London based division called length, which employs data scientists and creates AI products for various clients in the healthcare sector, amongst others. So hopefully it's a topic that is close to your heart, and it would be helpful to explore some of the issues arising in this area. So I think the first question would be, under current UK law, how are AI-driven tools and digital apps classified when they're used for diagnostic, therapeutic or monitoring purposes.
So, yes, I think it's really important and right to turn to the topic of AI here. And I do have a confession for you here, well, in that I've used our own internal AI systems to help me prepare for this podcast. So, I see first-hand and I use AI day to day. I see first-hand how useful it is and just how much it's developing and so rapidly. And so it's deployment in the healthcare sector is hugely important and hugely beneficial on the whole to patients, including on the topics of safety, but also efficacy and drug discovery, clinical trials, et cetera. So to come to your question, how are AI-driven tools and digital apps classified when they're used for diagnostic, therapeutic and monitoring purposes? So they are classified generally as medical devices, and that means that those products then have to comply with the medical devices regulations, and they have to obtain CE or UKCA marking to show that they meet the necessary safety and performance standards. Now, you have then a tiering system. So where you're using AI tools for, for example, diagnosing medical conditions, that would be classed usually as a higher risk device. And that then results in more stringent regulatory requirements to be met. And then just rounding off, perhaps my answer to this question, the MHRA oversees the regulation of those products, including AI. So that helps to ensure that any AI products put on the market are subject to that process first, and that they are safe and effective for use.
The MHRA's role in regulating AI-based medical technologies
Yes. and just picking up that last point around the MHRA, are you able to explain how the MHRA is adapting its regulatory framework to keep pace with AI-based medical technologies? Because these things are evolving at a rate of knots, aren't they? And also, what should clinicians be aware of when integrating this technology into patient care?
So, let's split that into two, I think. So, let's talk about the MHRA first. And I listened to one of your earlier podcasts with Interests, and that covered this topic to a degree. That was with Rachel Phillips of Insurance Broker, WTW, and that was recorded, I think, in July 2024. Yes, that's right, yeah. So, almost a year ago, but I entirely agree with what she said at the time, because it's still broadly holds good today. And so in particular, the MHRA is keen to be seen as a leader, as is the UK as a whole in AI development and use. But rather than creating a slew of bespoke regulations on AI that you then have to try and interact with existing regulations and figure out how it all fits together, it's taking a pretty light touch voluntary approach compliance. Now that doesn't mean that it's a sleep at the wheel or anything like that, it just means that it's treating the existing regulations generally as being capable of covering what is expected from AI products. And I think, as Rachel mentioned in that previous podcast, we're seeing government departments like the MHRA and NHS working together to try and form coherent, practical frameworks and rules for AI use in the healthcare sector. So I'm really glad to see that coordination and I think I'm really glad to see that rather than over-regulating, there is a degree of trust between the government and those who are developing and deploying AI products that we all care that those products are safe. So I think hopefully that answers your question on the MHRA side. Perhaps I'll turn to what care professionals have to think about when they are using AI products. So of course, if you are dealing with an AI product that is classed as a medical device, as I've mentioned earlier, and that would be, for example, where it's being used to diagnose a condition, then really your first port of call in looking at whether that product is safe is looking at CE or UKCA marking and understanding the body of documents that exist to support the fact that the product is safe. But I think we have a really curious aspect when we look at AI, which is that AI inevitably develops over time. Its algorithms change. It assimilates the information that it's been given on a real-time basis and adapts. And that, of course, is positive, but it also creates a risk of unpredictability. What will the AI do tomorrow? That's always a concern that plays on our mind in so many different areas. So understanding what the purpose of the AI product is, what is its output? Is it a narrow output on a very specific thing like diagnosing a very specific condition, looking for a very specific marker in blood or cells, or is it wider than that? So the narrower you go with it, the less risk because what it can do wrong is more limited. But understanding and monitoring whether it is continuing to do a good job is really important. In theory, the output should become more and more reliable over time. But of course that might go awry. So what if actually the AI's percentage accuracy rate is diminishing over time? At what point do you have to literally pull the plug on that product and recognize that something is going awry. So that's quite a lot for a lot of practices to get on top of. But ultimately, I think we all know AI is here to stay. And it's really important investing the time in understanding what makes these products tick.
Resolving product liability claims involving AI
Yeah, thank you. It's a great answer. And I would entirely agree with you that AI, at least in healthcare application, is a force for the good that is here to stay and we're already seeing it increasingly widely used. So, I think that is something that we are going to live with and we're going to have to get used to. And I suppose that just leads on to my final question around AI, which is, how do you envisage product liability claims involving AI being resolved in the future?
So let's split that into two jurisdictions. Let's talk about the UK first and let's talk about the EU next, because I'm mindful that a lot of listeners here, they might be doing business in both territories, and of course, beyond that. But in the UK, our product liability laws have not expressly developed to take into account AI, and there's no real agenda by the government at the moment to overhaul our product liability laws. So it's expected, at least for now, that our existing product liability laws, dating back, as I mentioned at the very start of this podcast, in 1987, that they are good enough to cover AI. So when you're looking at whether you are liable for an AI product if it's caused harm, you fall back to the very basic tests in the 1987 Act, which is what persons generally are entitled to expect of the safety of that product. So at least you've got a relatively simple test in theory, not a bespoke test for the AI. But then what on earth are persons generally entitled to expect from AI when you look at safety? Is it that we expect it to be right all the time because it's got access to a huge amount of information and therefore why should it get it wrong? Or will we in the courts give it leniency in order to avoid stifling development and deployment of AI, do we recognize that society as a whole has to bear a degree of risk over novel products that are intended to benefit us all? So there's a bit of a question mark really about how the courts will deal with this in the future. There's no precedent case law to determine this yet.
The EU's approach to AI and product liability
So if I then just jump onto the EU briefly, And there we see a very, very different and very claimant-friendly approach. So I've mentioned that the Product Liability Directive from the EU was dated 1985, and that's the one we use in the UK. But in the EU, they have a new Product Liability Directive, which comes into force late next year. And it's very, very claimant-friendly. Now, it doesn't come into force in the UK because of the B word Brexit, but it will come into force in France, Germany, Italy, all the member states of the EU. And where you've got an AI product, that is very firmly in the crosshairs of that new regime. And there will be a presumption of defect and indeed causation, where the complexities of a product cause excessive difficulties for the claimants improving their case. And that recognizes that as a claimant, how on earth are you supposed to show that an AI product operated in an unsafe way. How do you get under the hood of the algorithms? That's really hard. So we're going to see a much stricter approach in the EU. The EU's presumption of defect that I've mentioned there is expressly intended to cover AI products as well as pharmaceuticals. So those two target areas are very much in the sweet spot as it were for this sector.
Key legal and regulatory trends shaping the future
Yeah, absolutely. Well, David, I'm conscious that we've been talking for some time and I do need to let you go. It's been an absolutely fascinating discussion, but just before we finish and just to wrap it up, I wonder if you could take a look into your crystal ball and share with us your thoughts about looking ahead, what you think are likely to be the key legal and regulatory trends that are going to shape the future of product liability in the healthcare and aesthetics sphere?
Thanks, Will. Well, it's always good to finish relatively succinctly, and I'm also a big fan of the rule of three, so I'm going to give you three key trends that I see. Firstly, as I've mentioned, the EU's new product liability directive is definitely going to shape behaviours in the healthcare sector. I'm advising a number of global manufacturers on how to meet those really claimant-friendly regimes, the presumptions of defect, and also early disclosure obligations. Although that doesn't directly cover the UK, most manufacturers, distributors, etc., will be operating across the EU and the UK, and it will affect behaviours in the UK. It may lead to various businesses more readily accepting that a product is defective and paying up rather than engaging in litigation. In the EU, when you couple that with the representative actions directive, which is fuelling class actions, including on an opt-out basis across multiple member states, you're going to see more class actions, at least in the EU, involving products from the healthcare sector, and probably a greater proportion of those claims being successful for claimants.
Secondly, the deployment of AI in healthcare is growing rapidly, and we see it in all sorts of ways, from the processes adopted by hospitals and clinics in terms of how they are running effectively, their treatment of patients and their business, to the embedding of AI into med tech products and medical devices implanted, where they are real-time monitoring blood markers, for example. AI is also a massive factor in developing personalised medicines matched to our individual DNA. We're going to see that sophistication increase, and I think that is a challenge for healthcare professionals because the more sophisticated the product, the more time you need to invest in getting to grips with it. But I would suggest it's worth investing that time.
Thirdly, we continue to see regulators closing gaps in various sectors on those involved in the supply or deployment of products who are seeking to try and escape liabilities by saying, for example, "I had no knowledge of that defect. I didn't know about the risks." We see that, for example, in other sectors with online platforms facilitating the sale of products from hard-to-trace supply chains. So we're going to see that gap closing. It is not going to be enough to say, "It wasn't my fault, I didn't know." That really increases the personal responsibility of healthcare professionals. In closing, I think the mantra of "the price of freedom is eternal vigilance" is really important here, and I really encourage all healthcare professionals to be as knowledgeable as they can, invest the time that they can into the products that they're passing onto their patients, and finally, not believe everything that social media influencers say.
Closing remarks and practical tips
Well, that's a great note to end on. Those are fantastic practical tips, which I'm sure are going to be very valuable to many of the listeners. So David, it just remains for me to say thank you for appearing as a guest on Altea Talks. It's been an absolute pleasure to see you again and to go through these fascinating topics with you. I'm very grateful to you for the time that you've taken to share your thoughts with us today.
Absolutely my pleasure, Will. Thank you.
Thank you for tuning in. I hope you enjoyed today's episode of Altea Talks. If you did, please don't forget to subscribe or leave a like or a review on whatever platform you're listening on, as this helps spread the word. If you have any questions or comments or topics you'd like us to explore in future episodes, please do contact us as we'd love to hear from you. You can find us on LinkedIn or visit our website at www.alteainsurance.com. Stay tuned for more episodes and until next time, take care of yourselves.
The information contained in this podcast is not intended to represent a complete analysis of the topics presented. It is provided for information purposes only. The views expressed are personal to Will Marshall and David Kidman and are not intended as legal advice or to give rise to a solicitor-client relationship. No responsibility can be accepted by Simmons and Simmons or Altea Insurance for any reliance placed upon the podcast. Independent legal advice should always be obtained before applying any information to particular circumstances.
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