A Clinical Trial Agreement defines the conduct of research between a sponsor and study site. This playbook emphasizes regulatory compliance, data ownership, and subject safety responsibilities.
Why This Matters: Uncapped or broad liability exposures can result in catastrophic financial losses and undermine risk management.
Negotiation strategy
If you're the Sponsor:
Negotiate for liability caps and carve-outs for willful misconduct. Ensure indemnities are balanced to protect against excessive risk.
If you're the Institution:
Advocate for reasonable liability limits and ensure indemnification obligations are not overly burdensome. Focus on fair risk allocation.
Essential elements
1
Liability Cap
Defines maximum financial exposure.
2
Indemnification Obligations
Outlines responsibility for third-party claims.
3
Insurance Requirements
Specifies necessary insurance coverage.
Action framework
ACCEPT
Propose edits when liability caps are absent or indemnification is too broad.
EDIT
Reject clauses with uncapped liability or unreasonable indemnities.
ADD
Add language for industry-specific risks or missing liability caps.
PRO TIP
Always ensure liability caps are aligned with the business's risk tolerance and industry standards.
Example clauses
FAVORABLE
Balanced Liability Clause
"The liability of each party shall be capped at the total contract value, except in cases of willful misconduct."
NEUTRAL
Standard Indemnification Clause
"Each party agrees to indemnify the other for third-party claims arising from their own negligence."
UNFAVORABLE
Uncapped Liability Exposure
"The contractor shall be liable for all damages without limitation."
Fallbacks
High-Risk Projects
In high-risk projects, ensure liability caps are sufficient to cover potential damages and include specific carve-outs for gross negligence.
Healthcare Contracts
Include indemnification for patient safety and regulatory compliance to address industry-specific risks.
Technology Transactions
Focus on indemnities related to data breaches and intellectual property infringements.
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WEEK 1
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WEEK 2
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WEEK 3
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WEEK 4
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