Patients in drug company-sponsored clinical trials were removed from ACC cover in 1992 because of fears the no-fault scheme could attract higher-risk trials to New Zealand.
Ethics committee chairwoman Victoria Hinson told Associate Health Minister Peter Dunne in a 2014 report made public this year that the two cases could undermine New Zealand's clinical trials system.
"There is a risk that, if the public becomes aware of the difficulties faced by these participants, it could affect future participation in, and conduct of, clinical trials in New Zealand."
In January, one man in a French pain-drug trial died and four others suffered brain injuries.
Ms Hinson wrote - prior to the confidential settlement - there was some evidence of a failure to comply with the committee's and Medicines New Zealand's guidance to promptly provide compensation to at least ACC standard.
The committee asked for either:
• A law change to return ACC cover for participants of drug industry-sponsored trials, or
• A requirement for drug companies to purchase from the corporation ACC cover for trials.
Mr Dunne said he and ACC Minister Nikki Kaye believed a change in ACC legislation was unnecessary, but asked for more information on alternatives, such as how ACC-equivalent cover should be provided.
The guidelines of Medicines NZ - an industry association - on compensation for injured trial participants specifically state they are "without legal commitment".
However, the government-appointed regional ethics committees reassure participants in a template leaflet that in the unlikely event of an injury, "compensation would be available from the study's sponsor" and that in disputes, they can "take action through the courts".
Medicines NZ's general manager, Graeme Jarvis, said its members supported prompt resolution of claims and payment of appropriate compensation if a person was injured through being in a trial.
But if causation was unclear, investigation was needed, and if that led to disagreement, "some form of legal arbitration will be required ... to seek resolution".