News & Trends - Pharmaceuticals
New export standard raises legal risks for local manufacturers of medicines and medical technologies

New legislation is set to impact Australian manufacturers exporting pharmaceutical products and medical technologies.
Adopted by the Council of the European Union (EU), the new product liability Directive, effective December 2024, significantly alters legal standards, potentially exposing Australian manufacturers to increased litigation risks abroad.
The Directive introduces strict presumptions of defectiveness and causation, compelling manufacturers to uphold higher product safety standards. By December 2026, EU member states are mandated to incorporate these changes into national legislation, raising the burden of proof for claims against manufacturers.
Of particular concern are Australian companies producing pharmaceuticals, medical devices, artificial intelligence-driven products, and digital health innovations destined for the EU market. Unlike Australia’s current product liability laws under the Competition and Consumer Act 2010 (Cth), which lack presumptions of causation, the EU Directive imposes immediate obligations on exporters to meet stringent EU standards.
Australia’s existing product liability framework was shaped by the EU’s 1985 Product Liability Directive (85/374/EEC), suggesting potential future amendments to Australian Consumer Law to align with global shifts and the increased likelihood of liability claims brought by consumers.
The Directive serves as a stark reminder for local manufacturers to reassess their product quality assurance protocols, ensuring compliance with rigorous EU standards to mitigate legal vulnerabilities.
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