On August 19, the Department of Health and Human Services (HHS) announced a new policy concerning laboratory developed tests (LDTs). Under this policy, HHS has determined that the Food and Drug Administration (FDA) must engage in notice-and-comment rulemaking before requiring premarket review of LDTs. Depending on the next steps from HHS and FDA, this announcement has the potential to reverse decades of FDA policies issued through guidance and could have wide-reaching effects on the clinical laboratory community and other stakeholders. This announcement also is likely to further focus attention on diagnostics regulatory reform in Congress.
Background
For decades, FDA has asserted that it has the authority to regulate LDTs as medical devices. But, the agency has generally exercised enforcement discretion over such tests – meaning that the agency has not required compliance with the Federal Food, Drug & Cosmetic Act (FDCA) –with the exception of certain test categories, such as pharmacogenomic (PGx) tests, direct-to-consumer (DTC) tests, and tests that respond to emerging pandemics. Meanwhile, many in the laboratory community and others have long taken the position that FDA does not have authority under the FDCA to regulate LDTs and, even if it has such authority, at minimum FDA must use notice-and-comment rulemaking, not informal guidances or policy statements.
In 2010, FDA issued a notice of its intent to actively regulate all LDTs as medical devices, and in 2014, it issued draft guidance documents proposing a new framework and notification process for LDTs. But, the agency never finalized those draft guidances. Instead, in the final days of the Obama Administration, FDA published a discussion paper that stated that FDA “would not issue a final guidance on the oversight of [LDTs] . . . to give our congressional authorizing committees the opportunity to develop a legislative solution.”
Over the past several years, certain Members of Congress have worked with FDA and key stakeholders on legislative proposals for regulating diagnostics (including LDTs), most notably the Verifying Accurate Leading-edge IVCT Development (“VALID”) Act of 2020, which was introduced in both the House and the Senate in March of this year. FDA has been an active partner of Congress in the development of legislative reform, but also has continued asserting its authority to regulate LDTs under existing legal authority. In recent years, FDA has increased its oversight of LDTs, particularly for PGx tests, DTC tests, and, most recently, COVID-19 tests.
New HHS Policy
Against that background, on August 19, HHS posted a statement on a COVID-19 webpage that states (in relevant part):
Rescission of Guidances and Other Informal Issuances Concerning Premarket Review of Laboratory Developed Tests
…
[T]he department … has determined that the [FDA] will not require premarket review of [LDTs] absent notice-and-comment rulemaking, as opposed to through guidance documents, compliance manuals, website statements, or other informal issuances. Those seeking approval or clearance of, or an emergency use authorization (“EUA”) for an LDT may nonetheless voluntarily submit a premarket approval application, premarket notification or an EUA request, respectively, but are not required to do so, and FDA will adjudicate those submissions. Those opting to use LDTs in their laboratories without FDA premarket review or authorization may do so with the understanding that they would not be eligible for PREP Act coverage absent approval, clearance or authorization and would remain subject to regulation by the Centers for Medicare & Medicaid Services under the Clinical Laboratory Improvement Amendments of 1988 …. Those with an active EUA to use an LDT to detect the virus causing COVID-19 or its antibodies are unaffected by this announcement.
This policy purports to rescind prior FDA policies regarding premarket review of LDTs that were not promulgated through regulations. This includes policies developed through guidance documents, compliance manuals, and statements on FDA’s website. The implications of this new policy are potentially far-reaching. Clinical laboratories offering LDTs would need to comply only with state and federal clinical laboratory laws, including the Clinical Laboratory Improvement Amendments of 1988 (CLIA), in order to offer tests, even for test categories for which FDA previously required premarket review. Other key takeaways and open issues include the following:
- Given that the policy appears on a COVID-19 website and refers to COVID-19 tests, there has been confusion about whether this policy applies to all LDTs, or just COVID-19 diagnostics. Recent discussions with senior HHS officials have confirmed that this new policy was intended to be broad – applying to all LDTs, not just COVID-19 diagnostics, although it is possible that the Administration will further clarify the scope of the policy.
- This policy does not impact FDA’s regulation of in vitro diagnostic (IVD) test kits, including molecular or serological test kits for the SARS-CoV-2 virus. IVDs will still require FDA review and authorization, including kits developed overseas and imported into the US. In March 2020, FDA issued a policy that allowed serology IVDs and LDTs for detecting SARS-CoV-2 antibodies to be introduced without any FDA review. Concerned with the reliability of certain test kits, FDA walked back that policy with respect to serology IVDs, but continued to allow serology LDTs for SARS-CoV-2 to be introduced without FDA review.
- The policy asserts that if FDA wants to regulate LDTs, notice-and-comment rulemaking would be required. However, it does not take a direct position on whether in fact FDA has legal authority to regulate LDTs.
- By its terms, the policy addresses only FDA’s authority to require premarket review, but does not address whether FDA could attempt to regulate LDTs using other authorities under the FDCA and, even if other authorities are available to FDA, whether notice-and-comment rulemaking would be required.
- The impact on LDTs that have received FDA clearance, approval, or authorization remains unclear. For example, if an LDT previously approved by FDA is modified by the offering laboratory, is the modification subject to FDA review? If not, would the modified test still be considered an FDA-approved LDT?
- The impact on companion diagnostics remains unclear. Presumably, FDA could still take the position that in order to approve a drug or biologic for which a companion diagnostic is needed, an FDA-approved test is required, even if it is offered as an LDT. But other LDTs could likely claim to identify patients for whom the drug is appropriate (or claim to support drug dosing) without FDA review.
Of course, it is worth noting that this new HHS policy was announced just two months prior to a presidential election. If the Administration changes in January 2021, this position could be reversed, although that also could raise legal questions given the current HHS statement. This policy will likely give new momentum to ongoing efforts to enact comprehensive legislation for diagnostic regulation, particularly as Congress considers Medical Device User Fee Amendments (MDUFA) reauthorization in the next session. Finally, some Members of Congress have already begun asking questions about this new policy, and more formal congressional inquiries could emerge in the coming days.
If you have any questions concerning the material discussed in this client alert, please contact the following members of our Food, Drugs, and Devices practice.
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