In Major Shift, FDA to Regulate Lab-Developed Tests as Normal Devices

Regulatory NewsRegulatory News
| 01 August 2014 | By Alexander Gaffney, RAC

The US Food and Drug Administration (FDA) announced Thursday that it plans to reverse a decades-old policy and begin regulating Lab-developed Tests (LDTs) more similarly to in vitro diagnostic devices (IVDs).


Under normal circumstances, medical devices can reach the market in one of two ways. Either they obtain FDA approval through the premarket approval (PMA) process—a difficult and expensive pathway that requires clinical data to support an application—or a premarket notification [510(k)] application that aims to show that a device is substantially equivalent to a predicate device, usually avoiding both the cost and clinical data required of PMAs.

There is, however, in practice a long-used exemption given to a subset of diagnostic devices. Whereas most in vitro diagnostic tests need to be approved or cleared by FDA, LDTs do not. That's because the devices were historically intended to be developed by and exclusively used within a single laboratory, and regulators feared that subjecting the devices to regulatory review would stifle their development entirely.

"Initially, laboratories manufactured LDTs that were generally relatively simple, well-understood pathology tests or that diagnosed rare diseases and conditions that were intended to be used by physicians and pathologists within a single institution in which both were actively part of patient care," FDA explained in a 2010 meeting notice. "These tests were ordinarily either well-characterized, low-risk diagnostics or for rare diseases for which adequate validation would not be feasible and the tests were being used to serve the needs of the local patient population."

But in recent years, FDA has noticed LDTs becoming increasingly complex and in some cases nearly indistinguishable from their FDA-cleared or -approved counterparts. Of particular concern to FDA is that many LDTs play critical roles in clinical decision-making in the context of personalized medicine (e.g. genetic testing), which it said raises the risk of incorrect or missed diagnoses, resulting in untimely or improper treatment.

The agency has long asserted its right to regulate the devices, but since 2011 has begun to move strongly toward a system of stricter regulation of LDTs, albeit not quite as strict as the current system for in vitro diagnostic devices. That's because FDA said it "recognizes that while the absence of FDA oversight may make it easier for laboratories to develop and offer tests on a rapid timeline, the absence of a level playing field creates a disincentive to innovation by other manufacturers whose tests are approved or cleared by the agency."

Moving Toward Regulation

FDA marked a shift in policy in 2013 when Commissioner Margaret Hamburg announced that FDA would be pursuing a regulatory framework for LDTs. "[FDA will be] working to make sure that the accuracy and clinical validity of high-risk tests are established before they come to market," Hamburg said.

Hamburg said FDA was aware of the need to preserve an environment for innovation, and that it would be pursuing a risk-based framework to balance the need for evidence with innovation and patient access.

But Hamburg's proposal received pushback from the LDT industry almost immediately. The American Clinical Laboratory Association (ACLA) filed a Citizen Petition with FDA arguing that the agency lacked the authority to regulate LDTs, which it said were regulated under the Clinical Laboratories Improvement Act (CLIA), which governs clinical laboratories and the standards they use to "assure consistent performance" and reliability.

At the core of ACLA's argument is that it considers LDTs not to be devices, but rather procedures for performing diagnostic testing using reagents and equipment. "They are essentially know-how, not articles," ACLA wrote. "Therefore, they are not subject to regulation under the FD&C Act." ACLA further cited the history of CLIA, arguing that Congress had never given FDA any explicit authority over LDTs.

In addition, ACLA said, because the devices do not leave the laboratories, they do not enter commercial distribution, and thus do not meet FDA standards for interstate commerce regulation.

FDA finally rejected that petition on 31 July 2014—the same day as it announced the release of its new LDT regulation policy.

At the core of FDA's rejection are three points:

  • Many LDTs are indistinguishable from regulated IVDs in that they are complex, software-driven and are performed in laboratories outside a patient's health care setting. In addition, many of these LDTs compete with FDA-cleared or –approved IVDs, posing a regulatory conundrum.
  • Because LDTs meet the statutory definition of "medical device" under the FD&C Act, they may be regulated as devices, and not the practice of medicine.
  • Products can be regulated under the commerce clause of the constitution even if they do not enter commercial distribution since they are "offered for sale"—i.e. commerce.

While ACLA did not comment on the rejection of its Citizen Petition Thursday, it released a statement indicating that it was concerned with FDA's intent to further regulate LDTs, and urged it to "exercise caution."

FDA's Proposed Framework

But what exactly does FDA's proposed framework propose? Quite a bit.

The draft guidance, Framework for Regulatory Oversight of LDTs, was submitted for congressional overview on 31 July 2014, and proposed a risk-based regulatory framework that will be staged in over the course of almost a decade.

"FDA recognizes that some laboratories may currently be offering devices as LDTs, even though they do not meet FDA’s definition of an LDT (e.g., they are not designed, manufactured, and used within a single laboratory)," FDA explains in the draft guidance. "Laboratory tests that are being marketed as LDTs but are in fact not LDTs are out of compliance with the FD&C Act; however, in the interest of ensuring continuity in the testing market and avoiding disruption of access to these tests, FDA intends to apply the same risk-based framework … to any IVD that is offered as an LDT by a CLIA-certified laboratory."

Under FDA's proposed risk framework, FDA will exempt "low-risk" (Class I devices) LDTs and LDTs intended for rare diseases and unmet needs from almost all regulations with the exception of:

  • registration
  • device listing
  • adverse event reporting

All of those requirements would come into effect six months after the guidance is finalized, FDA said.

High- and moderate-risk LDTs, however, will be subject to more rigorous regulatory requirements.

In addition to needing to meet the above three requirements for "low-risk" LDTs, moderate-risk LDTs (defined as Class II medical devices) will need to begin reporting adverse events within six months of the guidance being finalized, and will need to undergo premarket review (i.e. premarket notification, or 510(k) submissions) beginning five years after the guidance is implemented.

High-risk (Class III) devices will need to also begin reporting adverse events to FDA within six months of the guidance being finalized, and the "highest risk devices" will need to undergo marketed review (i.e. premarket approval (PMA) application) starting 12 months after the guidance, while all other high-risk devices will be reviewed over a four-year timeframe.

Devices would remain on the market during FDA's review. FDA said it will focus on reviewing LDTs which have the same intended use as FDA-approved or –cleared IVDs and devices, as well as LDTs meant to determine the safety or efficacy of blood and blood products.

Some LDTs will, however, continue to be exempt from regulation. For example, LDTs used "solely" for forensic and law enforcement purposes will be exempt, as will some LDTs used for transplantation when used in CLIA-certified settings.

All moderate- and high-risk LDTs would need to meet medical device current good manufacturing practices (cGMP) under 21 CFR 820, FDA said. Low-risk devices would be exempt from quality system regulations for the time being, FDA added.

FDA has also released the text of an accompanying draft guidance, FDA Notification and Medical Device Reporting for LDTs, that is intended to explain how manufacturers of existing LDTs can notify FDA of the existence of their devices, and how they can meet medical device reporting (MDR) requirements under the new framework.


Reaction to FDA's announced framework has been cautious, if not negative.

At least one member of Congress, Rep. Michael Burgess, expressed "concern" with the guidance, saying the approach was "redundant, will stifle innovation and will require additional taxpayer funding for the FDA." Burgess said a modernization of CLIA would be preferable to FDA's approach.

Burgess noted the 60-day notification period he demanded of FDA before it can officially release the LDT draft guidance may allow him to increase political pressure on the agency—something not outside the realm of possibility given the Energy and Commerce Committee's current work on its "21st Century Cures Initiative," of which he is a part.

Meanwhile the American Medical Association (AMA), the powerful lobby group for doctors, said FDA's guidance "raises a number of questions and concerns," and expressed its position that the current LDT system offers patients "access to safe and high quality diagnostic services that are essential to patient care."

The new approach, the AMA said, "may result in patients losing access to timely life-saving diagnostic serves and hinder advancements in the practice of medicine."

The Association for Molecular Pathology (AMP), an association representing molecular testing companies, also expressed its "concern" with the guidance, saying that current regulatory measures are sufficient to regulate LDTs, and that additional measures would be burdensome.

But not all groups were negative. AdvaMed, the medical device industry's largest trade association, said it commended the new LDT guidance, which would create parity between its companies' regulated devices and now-unregulated LDTs. "Such a review process should create a reasonable pathway to market and advance patient care by promoting timely access to innovative technologies," it said.

Some industry analysts noted the effect of the change could be profound. Matthew Herper, a columnist for Forbes, noted that DNA sequencing devices may be among the devices affected most by the guidance. Herper said some 11,000 tests made by 2,000 different laboratories could ultimately fall under FDA's new framework.

And other analysts noted that the guidance could create a powerful incentive for companies to work more closely with drugmakers so as to be their "preferred" diagnostic. In a companion guidance released on 31 July 2014, FDA explained that it wants companion diagnostic devices to launch at the same time as their therapeutic companions, creating a powerful incentive for a cooperative relationship between drug companies and IVD developers.

For now, though, the biggest unknown may well be the implementation of the guidance. Given the array of interests potentially willing to go against FDA—politicians, doctors’ groups and industry, to say nothing of legal groups that have threatened to sue the agency over LDT regulation in the recent past—the agency's implementation of the guidance may well be on hold for years to come.


FDA's Proposed LDT Framework


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