US product-liability counsel think in states and in statutes of repose. Liability is a fifty-jurisdiction question, defect and causation belong to the plaintiff to prove, and federal preemption shields a meaningful share of the pharmaceutical and device portfolio. None of that describes what happens to the same product inside the European Union once the EU Product Liability Directive (PLD), Directive (EU) 2024/2853, begins to apply on 9 December 2026.1Directive (EU) 2024/2853 of 23 October 2024 on liability for defective products, repealing Council Directive 85/374/EEC. The Directive presumes defects in defined circumstances, compels defendants to open their files, and can follow a single batch for twenty-five years.
1. Two Vials, Forty-Eight Hours Apart
The temporal rule reads cleanly. The PLD applies to products placed on the market or put into service after 9 December 2026, and Council Directive 85/374/EEC is repealed with effect from that date while continuing to apply to products placed on the market or put into service before it.2Council Directive 85/374/EEC of 25 July 1985 on liability for defective products, the regime the PLD repeals. Member States must transpose by the same date. Measured against a single unit of product, the rule allocates one regime and only one.
Measured against a pharmaceutical supply chain, it does something else. A marketing authorization does not place a product on the market once. Batches are released continuously, against one specification, from one plant, often with the same active-ingredient supplier, for years on either side of an arbitrary Wednesday. Two vials that are chemically indistinguishable, drawn from lots released forty-eight hours apart, can sit in the same hospital refrigerator under different liability regimes. Rights in the earlier vial extinguish ten years after that actual product was put into circulation, a phrase whose meaning the Court of Justice was required to construe two decades into the old regime's life.3Case C-127/04 O'Byrne, on the meaning of putting a product into circulation for the ten-year long-stop. The later vial can generate a claim for twenty-five years where the injury is latent.4PLD (n 1), Art. 17(1) ten-year expiry and Art. 17(2) twenty-five-year extension for latent personal injury.
What determines the regime, then, is neither the molecule nor the authorization nor the manufacturer. It is the release record for a lot. Two decades after the fact, in a European forum, that record will be asked to carry evidential weight it was never designed to bear, and the operator who cannot produce it does not occupy a neutral position: under the new regime a failure to produce ordered evidence is itself a route to a presumed defect.
The apparent answer then complicates further. The PLD treats software as a product, and it treats a person who substantially modifies a product outside the original manufacturer's control as its manufacturer, restarting the expiry clock from the moment the modified product is made available.5PLD (n 1), Art. 4, point (1) definition of product including software; Art. 8(2) substantial modification. A connected drug-delivery device placed on the market in November 2026 sits under the old regime. The same device, after a substantial software modification in 2028, may not. The threshold sits in Art. 4, point (18) PLD, which defers first to whatever Union or national product-safety law treats as substantial and, where no such threshold exists, asks whether the change altered the product's original performance, purpose or type outside the manufacturer's initial risk assessment and also changed the nature of the hazard, created a new hazard or increased the level of risk. Whether a cybersecurity patch shipped under a post-market surveillance obligation crosses that threshold the Directive does not say, and no answer can be borrowed from the old regime because the old regime had no such concept.
Two chemically identical vials from lots released forty-eight hours apart can carry liability regimes whose long-stops lie fifteen years apart, and the only document that distinguishes them is a release record.
The old regime is not a closing file. The Court of Justice delivered judgment under Directive 85/374/EEC in March 2026, and it will keep doing so for as long as pre-cutoff product remains within its long-stop.6Case C-338/24 LF v Sanofi Pasteur SA, judgment of 26 March 2026 under Directive 85/374/EEC. Two bodies of European product-liability law will be interpreted in parallel, by the same courts, for at least a decade.
2. Presumed Defects and Compelled Disclosure
The burden of proof formally survives. Art. 10 PLD requires the claimant to prove defectiveness, damage, and the causal link between them. Everything after that sentence moves in the other direction. Defectiveness is presumed where the defendant fails to comply with a disclosure order, where the claimant establishes that the product did not comply with mandatory safety requirements intended to protect against the risk that materialized, or where the damage was caused by an obvious malfunction during reasonably foreseeable use or under ordinary circumstances. The causal link is presumed where the product is defective and the damage is of a kind typically consistent with the defect. And where, despite disclosure under Art. 9 PLD and taking into account all the relevant circumstances of the case, the claimant faces excessive difficulties in proving defectiveness or causation, in particular because of technical or scientific complexity, the court presumes either or both once the claimant shows that defectiveness or a causal link is likely.7PLD (n 1), Art. 9 disclosure of evidence and Art. 10 burden of proof with its rebuttable presumptions.
The instinct of a US defendant is to reach for the malfunction theory as the closest analogue. Restatement (Third) of Torts: Products Liability § 3 permits an inference of defect from circumstantial evidence without proof of the specific defect, and that inference is familiar terrain.8Restatement (Third) of Torts: Products Liability §§ 1, 2, 3 (American Law Institute 1998). It is not the same instrument. An inference is drawn by a factfinder from evidence the plaintiff has adduced; a presumption relieves the claimant of adducing it and puts the operator to rebuttal. The distinction is not academic where the underlying science is contested, which in pharmacovigilance it almost always is.
Nor do the structural protections travel. The learned intermediary doctrine, the treatment of prescription drugs as unavoidably unsafe products, and a preemption terrain in which Mensing and Bartlett shield generic manufacturers and Riegel shields premarket-approved devices, even as Wyeth denies that shield to a brand-name failure-to-warn claim, are features of a system in which a federal regulator's approval can carry defensive weight.9Wyeth v. Levine; PLIVA, Inc. v. Mensing; Mutual Pharmaceutical Co. v. Bartlett; Riegel v. Medtronic, Inc. Neither the PLD nor the regime it replaces treats a marketing authorization as an answer to a defectiveness claim. Compliance and safety are separate questions in Europe, and satisfying the first does not dispose of the second.
Disclosure is where the two systems collide hardest. Art. 9 PLD allows a court, once the claimant has presented facts and evidence sufficient to support the plausibility of the claim, to order the defendant to disclose relevant evidence at its disposal, subject to proportionality and to the protection of confidential information and trade secrets. Refusal carries a price that US practice does not attach to it, because non-compliance with the order presumes the defect.7PLD (n 1), Art. 10(2)(a): defectiveness presumed where the defendant fails to comply with an Art. 9 disclosure order. A US manufacturer that resists production to preserve trade-secret protection, or because a protective order in a parallel US proceeding constrains what it may lawfully hand over, may discover that the resistance has decided the European case. Whether a US protective order is a lawful excuse before a German or an Irish court, and whether the answer differs between them because Art. 9 PLD lands inside national procedural law, is unresolved.
Under the old regime the Court allowed a national court to find defectiveness and causation from serious, specific and consistent circumstantial evidence, while holding that a rule under which predetermined facts are always taken to establish causation is precluded because it disregards the burden the Directive places on the claimant, and it accepted that a defect may be established across an entire production series where a group of devices shares a potential failure mode.10Case C-621/15 N W and Others v Sanofi Pasteur; Joined Cases C-503/13 and C-504/13 Boston Scientific Medizintechnik. Art. 10 PLD does not tolerate presumptions. It enacts them. For pre-cutoff product that case-law equilibrium continues to govern; for post-cutoff product it does not. The same manufacturer, before the same court, on the same molecule, faces two evidentiary regimes, and the line between them is a release date.
3. One Directive, Twenty-Seven Transpositions
Art. 3 PLD is a maximum-harmonisation clause: Member States may not maintain or introduce national provisions diverging from the Directive, more stringent or less stringent, to achieve a different level of protection for consumers and other natural persons, unless the Directive itself provides otherwise. The Directive then supplies its own divergence. Art. 11(1)(e) PLD exempts an operator who proves that the objective state of scientific and technical knowledge, at the time the product was placed on the market or put into service or during the period in which the product was within the manufacturer's control, was not such that the defectiveness could be discovered, and Art. 18 PLD permits a Member State to derogate from that exemption on asymmetric terms. Art. 18(1) PLD lets a Member State keep an existing measure imposing liability regardless, provided the text is notified to the Commission by 9 December 2026, while a measure introduced or amended under Art. 18(2) PLD must be confined to specific categories of products, justified by public interest objectives and proportionate, and must be held in abeyance for six months after notification unless the Commission gives its opinion sooner.11PLD (n 1), Art. 3 maximum harmonisation, Art. 11(1)(e) development risk defense, Art. 18 Member State derogation.
For a pharmaceutical defendant the development risk defense is not one issue among many. It is the issue. Under the old Directive five Member States exercised the equivalent derogation, and no two of the limited versions matched: Finland and Luxembourg removed the defense for all products; France removed it for elements of the human body and products derived from them; Spain removed it for medicinal products and for foodstuffs; Hungary removed it for pharmaceutical products.12European Commission evaluation of Council Directive 85/374/EEC. Germany is absent from that list, for a reason that matters more than its absence.
German law does not apply the ProdHaftG to death or personal injury caused by human medicinal products caught by the AMG. § 15 ProdHaftG disapplies the Act where a person is killed or injured by a medicinal product for human use that is subject to the authorization requirement, or exempted from it by ordinance, and that was supplied to the consumer within the territorial scope of the AMG, leaving §§ 84 ff. AMG to govern through a separate strict-liability regime. The government bill transposing the Directive, introduced in the Bundestag on 25 February 2026, recasts the ProdHaftG entirely and carries that carve-out forward. It retains the development risk defense as the general rule and, against the intuition that a maximum-harmonisation instrument would extinguish national idiosyncrasy, it exercises the Art. 18(1) PLD derogation sectorally, maintaining development-risk liability in genetic engineering under § 37(2) GenTG.13German government bill BT-Drs. 21/4297 (25 February 2026).
As of publication the bill had passed first reading on 4 March 2026 and been heard in the Ausschuss für Recht und Verbraucherschutz on 13 April 2026. It had not been adopted, and it had not been promulgated. France, whose product-liability regime is codified at Art. 1245 Code civil and the articles that follow it, had published no transposition text at all. Only Hungary had communicated a national transposing measure to the Commission. Whether the states that removed the development risk defense under the old Directive will exercise the new derogation, and whether any state will introduce a derogation it has never had, was unsettled across most of the internal market.
In the months before a maximum-harmonisation directive begins to apply, therefore, the single question that most determines a pharmaceutical operator's European exposure, whether the development risk defense exists in the forum, cannot be answered for most of the internal market. Whether a US sponsor's German subsidiary is inside the harmonised regime at all depends on whether its product is a medicinal product caught by the AMG carve-out or a device, a line that combination products do not respect. Art. 2(4)(c) PLD leaves untouched any right an injured person has under a special liability system that existed in national law on 30 July 1985, and the German bill rests the carve-out on that provision; whether a provision that preserves rights under such a system also lets a Member State switch off the harmonised regime for an entire product category is a different question, and one the Directive does not answer. And whether an operator may invoke the development risk defense in a Member State that has not transposed by 9 December 2026 raises the direct-effect problem in the form that horizontal litigation between private parties handles worst.
4. Switzerland Declines the Invitation
Switzerland is not an EU Member State, and EU directives have no direct effect there. Its product-liability statute, the PrHG of 18 June 1993, was enacted as an autonomer Nachvollzug of Directive 85/374/EEC rather than as a treaty obligation, and nothing requires it to track the successor.14Bundesgesetz über die Produktehaftpflicht (PrHG) vom 18. Juni 1993 (SR 221.112.944). As of publication no Swiss legislative project, consultation, or Botschaft proposed to align the PrHG with Directive (EU) 2024/2853.
The consequence is a fork inside a single supply chain. The PrHG retains the development risk defense at Art. 5(1)(e) PrHG, with a carve-out for xenotransplantation products at Art. 5(1bis) PrHG. It imposes no presumption of defectiveness and no presumption of causation. It supplies no disclosure mechanism. Claims are subject to a three-year limitation period under Art. 9 PrHG and extinguish ten years after the producer put the product into circulation under Art. 10 PrHG. Property damage is compensable only for items ordinarily intended for private use or consumption and used by the injured person mainly for private purposes, subject to a deductible, which places commercial loss outside the statute altogether.
Read alone, Art. 10 PrHG looks like a decade of protection against a European twenty-five-year tail. Read with Art. 11 PrHG, which reserves claims arising under other law, it looks different. A Swiss claimant whose PrHG rights have extinguished may plead in tort, and Art. 60(1bis) OR, in force since 1 January 2020, bars a claim for damages arising from death or bodily injury three years after the injured person learns of the damage and of the person liable, and in any event twenty years after the day the harmful conduct occurred or ceased.15Art. 60 OR: three-year relative and ten-year absolute periods, with a three-year relative and twenty-year absolute pair at Art. 60(1bis) OR. The Swiss tail is not ten years. It is ten years under the strict-liability statute and twenty years under the general law of tort, at the price to the claimant of proving fault. Whether that trade is worth making is precisely the calculation a plaintiff's lawyer performs, and it is not a calculation the PrHG's long-stop forecloses.
A US manufacturer supplying an EU distributor and a Swiss distributor from one plant therefore confronts, on the same lot, a presumption-backed twenty-five-year exposure on one side of a border and a fault-based twenty-year exposure on the other, governed by different statutes, different burdens, and different definitions of compensable damage. The contractual allocation of that asymmetry across a supply chain, and the limits of what allocation can achieve, is examined in Insight 04.
5. The Tail, the Tower, and the 10-K
Art. 17 PLD sets the outer boundary. Rights expire ten years after the defective product was placed on the market or put into service, extended to twenty-five years where the latency of a personal injury prevented the injured person from initiating proceedings within the ten-year period.4PLD (n 1), Art. 17(2): twenty-five-year expiry where a latent personal injury prevented timely proceedings. The provision is drafted for exactly the pharmaceutical case, an adverse effect that does not manifest for a generation.
US practice holds no comparable instrument. A minority of states, commonly counted at fewer than twenty, impose a products-liability statute of repose at all, and where one exists the period typically runs ten to fifteen years from sale or delivery: ten years in Tennessee, Connecticut and Indiana, twelve in North Carolina, fifteen in Texas, each with its own exceptions, so that the Connecticut period does not run at all against a claimant who proves the harm occurred during the product's useful safe life. Federal repose exists only in narrow settings, such as the eighteen-year period the General Aviation Revitalization Act confers on general-aviation aircraft manufacturers.16Representative state products statutes of repose in Tennessee, Connecticut, Indiana, North Carolina and Texas; GARA. The European tail exceeds the longest common state period by a decade, and it cannot be shortened by agreement: Art. 15 PLD provides that an operator's liability toward the injured person is not limited or excluded by a contractual provision or by national law, and Art. 12 PLD makes multiple operators jointly and severally liable.17PLD (n 1), Art. 12 joint and several liability; Art. 15 exclusion or limitation of liability. Indemnities between operators reallocate the loss. They do not cap it, and they do not run against the patient.
This is the point at which the exposure stops being a European legal problem and becomes a US balance-sheet problem. Standard US directors-and-officers and products towers do not automatically respond to non-US claims. Territorial scope clauses, foreign-jurisdiction exclusions, and the practice of writing local admitted policies beneath difference-in-conditions and difference-in-limits layers mean that coverage for a claim asserted in Düsseldorf is a question of wording rather than of assumption. A claims-made tower incepted in 2026 is not obviously the tower that answers a claim asserted in 2049 on a lot released in 2027, and the run-off, the retroactive date, and the law governing the placement will decide which tower does. Whether an insurance program approved by a US risk committee against a US repose horizon was ever priced against a European twenty-five-year horizon is a question with an answer inside the company and nowhere else.
The disclosure consequence arrives earlier than the claim. FASB ASC 450 requires a loss contingency to be accrued once the loss is probable and reasonably estimable. Item 303 of Regulation S-K requires management to discuss known trends and uncertainties reasonably likely to have a material effect, Item 105 requires the material risk factors, and Form 8-K requires prompt disclosure of specified material events.1817 C.F.R. § 229.105 (Item 105), § 229.303 (Item 303), § 229.103 (Item 103); Form 8-K; FASB ASC 450. A liability regime that presumes defectiveness in defined circumstances, and presumes causation where the damage is of a kind typically consistent with the defect, does not merely change how European litigation ends. It changes the probability assessment that sits upstream of accrual, and it changes it on 9 December 2026, whether or not a claim has been filed. Whether that shift is itself a known uncertainty requiring discussion, and whether the discussion belongs in the risk factors or in the MD&A, is a judgment made by people who may never read the Directive.
6. Strategic Considerations
If the regime governing a claim is fixed by the date a lot was released, the release record is a liability-determinative document, and the question is not whether it exists but whether it will survive twenty-five years of system migrations, plant divestitures, and contract-manufacturer transitions in a form a European court will accept. Who owns that record inside a company that has outsourced fill-finish is rarely a question the quality organization and the legal organization have answered together, and it is rarely a question either believes belongs to it.
The development risk defense may exist in the forum, or it may not, and as of publication most Member States had not said. A company cannot know which of its lots were first placed on the market in Helsinki rather than in Vienna without asking a distribution question that its regulatory function does not track and its commercial function does not preserve. Where one state omits the defense and its neighbor retains it, the same latent injury on the same lot produces different outcomes, and the difference was settled years earlier by someone optimizing freight.
An Art. 9 PLD order will arrive during litigation rather than before it, and the operator will have to decide whether to produce material that a US protective order arguably forbids it to produce, knowing that refusal presumes the defect. Whether the resulting conflict resolves as a matter of comity, of national procedural law, or of the trade-secret protections the Directive obliges the court to apply, is untested, and the first answer will be given in a case that already has a claimant in it.
The tower's response to a 2049 claim on a 2027 lot depends on wording drafted against a different horizon. If defectiveness is presumed in circumstances a company can enumerate, the estimate of what is probable changes, and that estimate feeds a filing. Whether the first US disclosure of European product-liability reform is made deliberately, in a risk factor drafted with counsel, or reactively, in an 8-K filed after a court in a Member State whose transposition nobody read has presumed a defect, is not a legal question. It is a question about who was watching.
These questions require analysis tailored to specific facts and commercial context.