New Product Liability: Risks for Life Sciences and Healthcare
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The new EU Product Liability Directive (EU) 2024/2853 fundamentally changes product liability in Europe. Member States must transpose the Directive into national law by 9 December 2026. The new liability regime will then apply to products placed on the market or put into service from that date onwards. On 8 October 2026, the German Bundestag passed the Act on the Modernisation of Product Liability Law, which will come into effect on 9 December 2026, making the new liability standards, evidentiary relief and disclosure obligations part of German product liability law.
These changes are particularly relevant for companies in the life sciences and healthcare sectors. Medicinal products, medical devices, diagnostics and, increasingly, software-based healthcare solutions are already caught in the tension between complex technology, stringent regulatory requirements and patient safety. The new Product Liability Directive adds an extra dimension of liability to this risk landscape.
For companies in the life sciences sector, product liability will become an even more strategic issue in future. Regulatory issues, product safety and liability risks must be considered even more closely in conjunction with one another and assessed collectively throughout the entire product life cycle.
At the same time, the scope for collective redress in Europe is continuing to develop. The CMS European Class Actions Report 2026 shows that product liability and personal injury cases already accounted for 14 % of recorded European class actions in 2025.
What changes will the new Product Liability Directive bring?
Broader definition of "product": In future, the definition of "product" will explicitly include software – including stand-alone and embedded software as well as AI systems – along with digital manufacturing files, components, raw materials and more. Product liability is therefore becoming increasingly relevant for connected medical devices, software as medical devices and other digital health solutions.
Product liability is increasingly becoming a lifecycle issue: In future, a manufacturer's liability will not necessarily end when a product is placed on the market. It may also be relevant to defects that arise subsequently, for example from software or associated services, provided that these remain under the manufacturer's control. Failure to install security-related software updates or patches may also play a role. For manufacturers of digital and connected medical devices in particular, this means that product liability must be taken into account throughout the entire product life cycle.
A wider range of potentially liable parties: In addition to manufacturers and importers, the terms of the Directive may also affect, for example, attorneys-in-fact, fulfilment service providers, distributors and online platforms. Multiple economic operators may be jointly and severally liable.
Easier burden of proof to meet: Some particularly important changes are the new rebuttable presumptions regarding defects and causation. They may become relevant if for example claimants face undue difficulties in proving a product defect or the causal link due to a product's technical or scientific complexity.
This is particularly relevant for pharmaceutical, biotech and medtech companies, as scientific complexity and questions of causation often play a key role in product liability proceedings.
Disclosure of evidence made more extensive: Courts will also be granted broader powers to order the disclosure of relevant evidence where claimants present facts and evidence that sufficiently support the plausibility of their claim. Companies should therefore review at an early stage whether development, testing, risk and safety decisions as well as post-market activities are documented in such a way that they can be used for the defence in a product liability case even years later.
Liability risks over longer periods: The standard maximum limitation period remains ten years, but is extended to 25 years in the case of latent personal injury. Particularly in the case of products or substances where alleged health effects only become apparent years after treatment or exposure, the long-term retention of relevant documentation will therefore become significantly more important.
Which risks are particularly relevant to life sciences and healthcare?
PFAS and other critical substances: PFAS are a prime example of how regulatory developments can lead to product liability cases and ultimately class actions. The CMS European Class Actions Report 2026 identifies PFAS as a potential new area for collective redress. Proceedings are already underway in several jurisdictions across Europe. The report explicitly identifies medical devices as one of the downstream sectors in which product liability risks may arise. For life sciences companies, a risk analysis should therefore not stop at the end product. Components and materials within the supply chain may also be relevant.
Connected medical devices and software: Due to the explicit inclusion of software and the potential liability for safety-related updates, product liability issues are becoming increasingly important, particularly in relation to connected medical devices and digital health solutions. The more medical devices integrate hardware, software and connectivity, the more important it becomes to ensure coordination between regulatory affairs, product safety, cybersecurity and product liability.
AI-based healthcare solutions: AI systems may also fall within the expanded definition of a "product". At the same time, complex technologies especially may render the new rules of evidence relevant if claimants face technical or scientific difficulties in demonstrating defects or causation.
Recalls and regulatory measures: In future, when assessing whether a product is defective, factors such as product recalls and measures taken by the competent authorities may be taken into account. This means that regulatory response and litigation readiness should be considered more closely together. Regulatory measures may also become relevant beyond their immediate consequences to subsequent product liability proceedings.
Latent damage to health: The extended limitation period of up to 25 years for latent personal injury claims is also relevant to the sector. In particular, companies whose products or the substances they use could be linked to health effects that only become apparent in the long term must therefore review their documentation processes and litigation readiness.
From individual product liability cases to collective proceedings
The new Product Liability Directive should not be viewed in isolation. In parallel with expanding substantive product liability, instruments for collective redress are continuing to develop in Europe. The CMS European Class Actions Report 2026 [LH1] [RS2] shows an increase in new proceedings relating to product liability and personal injury. Evidence that the life sciences and healthcare sector is already being affected comes from markets including Portugal: A class action was brought there in 2025 against eight pharmaceutical companies in connection with oral medicinal products. The claims assert allegations of misleading advertising and unfair commercial practices and seek compensation or reimbursement for consumers. The new Product Liability Directive may further amplify this trend. Broader categories of damage, evidentiary relief and disclosure obligations may encourage further legal action and increase the pressure on companies to defend themselves and reach settlements.
The combination of broader liability standards, evidentiary relief and collective redress creates a significantly more challenging claims and litigation environment for manufacturers. In regulated sectors such as life sciences and healthcare in particular, the potential for complex and cross-border proceedings is increasing.
The key development for the sector is that extended product liability, an easier burden of proof to meet and increasing collective redress are leading to a new litigation risk profile for life sciences and healthcare.
What should companies review now?
1. Analyse the product portfolio: Which products, components, software solutions and substances could be affected by the extended liability regime?
2. Review documentation and data retention: Are product development, risk assessments, tests and safety decisions documented in a way that ensures traceability for the long term?
3. Examine supply chains and substance risks: Which critical substances, such as PFAS, are found in products and components?
4. Combine regulatory and litigation readiness: Which product safety, post-market or regulatory issues could later give rise to product liability claims?
5. Assess collective exposure: Could a similar product, safety or compliance problem affect a large number of patients or consumers and thus become a matter for collective redress?
Conclusion: From product compliance to litigation readiness
For life sciences and healthcare companies, preparations for the new Product Liability Directive should go beyond simply complying with new legal requirements. Regulatory, technical and supply chain-related risks should also be considered to determine whether and how they could lead to product liability and collective proceedings in the future.
