Lost on the High Seas without a Safe Harbor or a Shield? Navigating Cross-Border Data Transfers in the Pharmaceutical Sector After Schrems II Invalidation of the EU-US Privacy Shield

Abstract

This paper analyzes the impact and associated legal challenges of cross-border data transfers in the pharmaceutical sector after the recent Court of Justice of the European Union (CJEU) decision in Case C-311/18 Data Protection Commissioner v Facebook Ireland Limited, Maximillian Schrems (Schrems II). In Schrems II, the CJEU invalidated Decision 2016/1250 on the adequacy of the protection provided by the EU-US Privacy Shield Framework. That said, the Court also found that the European Commission Decision 2010/87 on standard contractual clauses (SCCs) for the transfer of personal data to processors established in third countries is still valid. The ruling has resulted in significant uncertainty and liability risks for organizations that depend on EU-US cross-border transfers of personal data, including pharmaceutical companies (data controllers) engaged in global clinical trials and their technology providers for endpoint collection and data transfer (processors). In light of these challenges, this paper discusses the need for a legally sound regulatory environment for data transfer. To mitigate risks and uncertainties, we stress the need for updated GDPR-compliant SCCs and SCC guidelines and argue, inter alia, for the adoption of data protection frameworks which incorporate SCCs with a robust information security management system (ISMS) and a privacy information management system (PIMS) to ensure an appropriate level of data protection, as well as for sector specific transfer mechanisms including health data adequacy decisions and the need for GDPR certification and codes of conduct for cross-border transfers of clinical trial data.

Keywords: GDPR, Data transfer, Schrems II case, data protection, data security, Privacy Shield, Standard Contractual Clauses (SCCs), pharmaceutical sector