FDA Targets Lab-developed Tests: A Regulatory Shift

Laboratory-developed test (LDT) manufacturers are accustomed to not having to deal with the FDA, who has historically exercised enforcement discretion, leaving CMS to oversee LDTs through CLIA regulations. This is very likely to change this year, with a new rule forcing many LDTs to undergo FDA submission review. Here we analyze the context and rationale for this move, and the implications for manufacturers.

CONTEXT

On September 29, 2023, the US Food and Drug Administration proposed a rule aimed at regulating laboratory-developed tests (LDTs), over which they have traditionally exercised enforcement discretion. LDT manufacturers and industry groups have successfully pushed back against FDA’s efforts to regulate LDTs for more than a decade. This time, though, FDA is likely to succeed, for two reasons. 

First, when the COVID-19 pandemic led to an unprecedented number of emergency use authorization (EUA) submissions for COVID tests from LDT manufacturers, FDA saw that the majority of these submissions demonstrated inadequate test design and validation strategies. FDA is using this observation, along with previously stated concerns about public health benefits, claims, and functional equivalence to cleared IVDs, to propose a new rule aimed once again at bringing LDTs under FDA purview. 

Second, FDA and the Centers for Medicare and Medicaid Services (CMS) issued a joint statement a few weeks ago. In it, CMS, who currently oversees LDTs through the administration of the Clinical Laboratory Improvement Amendments (CLIA), outright stated that they do not have the expertise to ensure the safety and effectiveness of LDTs, and voiced support for FDA’s efforts in this regard. Industry groups are mounting lawsuits, which may cause delays, but this joint FDA/CMS position takes away what has been the most prominent argument against FDA oversight - that CLIA/CMS oversight is sufficient. 

We believe that this regulation will go into effect this year, and it is very likely that when that happens, your LDT may end up classified as Class I (low risk), Class II (medium risk), or even Class III (high risk), all of which will require some additional work. 

IMPACT ON LDT MANUFACTURERS

Companies that haven't interacted with the FDA before will need to develop regulatory capabilities, define their regulatory strategy, and write submissions for the very first time. Are you prepared to meet these requirements? Consider the following questions:

QUESTION 1: Is your test validation strategy good enough for FDA?

There’s a good chance that FDA will want it to be more robust. After all, they publicly stated that of the first 125 COVID-19 EUAs they received, 82 of them were inadequate in this respect. If your validation strategy is CLIA-based, it probably won’t meet FDA’s requirements.

QUESTION 2: Have you performed a full risk evaluation for each test? 

This goes beyond consideration of the test and the lab, and includes all instructions and public materials, claims, potential user error, and risks associated with misunderstanding of results. The most common standard for this (and one recognized as a consensus standard by FDA) is ISO 14971, and its implementation is not straightforward.

QUESTION 3: Does the benefit of your test outweigh the risks?

You probably think it does, and in fact it may seem self-evident. However, you will need to support this position with references and/or testing to get FDA clearance. If your test is prescription-only then this will be less difficult. If you are selling directly to consumers (DTC), you will need to make a much stronger case.

QUESTION 4: Is your quality system 21 CFR and/or ISO 13485-compliant?

Your current quality system likely needs revision and/or expansion before you will be legally allowed to market your device under this new rule. This is a requirement for all manufacturers, regardless of your device’s classification.

QUESTION 5: Will you still be able to make the same marketing claims?

Maybe not. Depending on what you’ve been claiming your test can do, an FDA clearance may restrict what you can say (or it may allow you to claim even more than you were previously). Understanding this in advance is important for your marketing and messaging strategy.

You still have time, but there’s a good chance that FDA will get inundated with submissions as the deadlines get closer.  If you have questions or want to review what these regulatory changes might mean for your product strategy, reach out to us.