Inside FDA's Proposed Rule to Regulate Laboratory Developed Tests (LDTs)

On September 29, 2023, the FDA proposed a rule that would end the enforcement discretion policy for laboratory-developed tests (LDTs) by treating them as In Vitro Diagnostics (IVDs) subject to regulatory requirements as medical devices.

The rule would add a statement to the definition of "in vitro diagnostic products" in 21 CFR Part 809.3(a), stating that IVDs are considered devices under the FDCA, even if a laboratory is the manufacturer.

The rule proposes a phased approach, with LDT manufacturers required to comply with regulatory requirements in stages. Compliance will begin one to four years after the final LDT rule is published. The final policy will be included in the rule's preamble.

It is currently unclear when the regulatory requirements will become effective. Laboratories that offer LDTs should stay informed and keep track of any developments related to the Proposed Rule. It's important to note that the Proposed Rule does not intend to "grandfather" any LDTs that are currently available in the market.

A Brief Primer on the FDA's LDT Regulation

According to FDA regulations, IVDs are defined as:

“reagents, instruments, and systems intended for use in the diagnosis of disease or other conditions, including a determination of the state of health, in order to cure, mitigate, treat, or prevent disease or its sequelae and intended for use in the collection, preparation, and examination of specimens taken from the human body.”

IVDs are classified by the FDA as medical devices, and as such, they are subject to a full range of premarket and postmarket controls, which include requirements related to 510(k) premarket notification or premarket approval (PMA), quality system (QS) regulation, medical device reporting (MDR), registration and listing, and labeling.

IVDs are also regulated under the Clinical Laboratory Improvement Amendments of 1988 (CLIA). LDTs are IVDs that are designed, manufactured, and used within a single lab holding a clinical lab certification under CLIA.

Although the FDA can regulate LDTs as medical devices, it has not enforced pre-market review and other regulatory requirements for LDTs due to their limited use in small volumes, mostly in rare diseases, and with interpretation by a treating physician.

According to the FDA's new Proposed Rule, LDTs have become increasingly popular and are being used by a more diverse population. They are also being relied upon more frequently for making important healthcare decisions.

The Proposed Rule suggests that LDTs are now similar to other IVDs that have not been subject to the FDA's general enforcement discretion approach. Therefore, FDA believes phasing out the general enforcement discretion approach for LDTs is essential to protect public health. To ensure that only genuine LDTs are covered by the rule, the FDA is defining LDT broadly, as many manufacturers of high-complexity tests have been disguising their tests as LDTs.

Prior attempts at LDT regulation

The FDA has attempted to regulate LDTs before, with draft guidances dating back to 2006.

• In 2006 and 2007, the FDA released and revised a draft guidance regarding a specific category of Laboratory Developed Tests (LDTs) known as In Vitro Diagnostic Multivariate Index Assays (IVDMIAs). IVDMIAs are a type of test that provides results that are not transparent and cannot be independently derived by the end-user, typically a physician. However, the FDA never finalized its guidance for IVDMIAs and instead announced in June 2010 that it intends to regulate all LDTs.
• In July 2014, the FDA announced its intent to regulate LDTs through draft guidance. The October 2014 draft guidance presented a risk-based framework for regulating LDTs, classifying them into three groups based on their level of risk. The FDA would determine whether to enforce certain or all applicable regulatory requirements for an LDT based on risk evaluation. The FDA collected comments on the draft guidance document; however, in November 2016, it announced that it would be delaying finalization.
• In January 2017, the FDA published a Discussion Paper on LDTs where it summarized the comments received on the 2014 draft guidance. The agency stated that it would not be issuing a final guidance on the oversight of LDTs, as requested by various stakeholders. Instead, they wanted to allow for further public discussion and allow their congressional authorizing committees to develop a legislative solution. The discussion paper proposed a framework for an approach to LDT oversight that mainly focuses on new and significantly modified high and moderate risk LDTs. LDTs that have been marketed previously would not be expected to comply with most or all FDA regulatory requirements, such as premarket review, unless necessary to protect public health. Moreover, new and significantly modified LDTs in several specified categories, such as LDTs for rare diseases, would generally not be expected to comply with FDA regulatory requirements.

Key Issues in the FDA's Regulation of LDTs

Over the past few years leading up to 2023's Proposed Rule, the FDA has been regulating LDTs without any specific agency guidance. This includes DTC genetic tests that provide information about a patient's predicted response to medications and the risk of developing a disease or condition. These tests can facilitate precision medicine.

DTC genetic tests

Genetic testing has become widely available for direct consumer purchase, especially over the internet, for various diseases, including complex and common ones like cancer.

Historically, the FDA exercised enforcement discretion over LDTs. However, despite the lack of specific agency guidance, it has started asserting authority over these tests, especially DTC genetic tests providing disease risk or medication response information.

Notably, the FDA clarified in its 2014 draft guidance that it generally doesn't exercise enforcement discretion for DTC tests, irrespective of whether they meet the LDT definition. It began enforcing regulations on certain DTC genetic tests, as evidenced by its warning letters to 23andMe in 2013, and other companies like Pathway Genomics, Inc. in 2015.

The FDA has authorized some specific DTC genetic tests for marketing, reflecting its evolving approach. This includes the clearance of 23andMe’s tests for Bloom Syndrome, genetic health risks, and other conditions.

Pharmacogenetic testing

FDA has been proactive in regulating pharmacogenetic tests, which examine genetic variants linked to drug metabolism. Many of these tests are offered as LDTs.

In 2018, the FDA cleared 23andMe’s PGS Pharmacogenetic Reports test, which informs how a patient may metabolize certain medications. However, the FDA has also issued safety communications warning against the use of certain DTC and provider-ordered tests that claim to predict response to specific medications, stressing that these claims have not undergone FDA review.

In April 2019, the FDA sent a warning letter to Inova Genomics Laboratory for marketing tests, without FDA clearance, that claim to predict a patient’s response to specific medications.

Companion diagnostics and personalized medicine

The FDA’s guidance defines companion diagnostics as in vitro diagnostic devices essential for the safe and effective use of a corresponding therapeutic product. The use of these devices is stipulated in the instructions for both the diagnostic device and the corresponding therapeutic product.

The Agency FDA emphasizes that if evidence supports the use of a diagnostic with a group of therapeutics, its labeling should refer to the specific group rather than a single product. This approach is intended to increase clinical flexibility. Further guidance elaborates on this, particularly for oncology therapeutic products.

Recent legislative activity on LDTs

Since the enactment of the 21st Century Cures Act, there has been ongoing consideration of various legislative approaches to FDA regulation of  IVDs and LDTs.

• One of the proposed regulatory approaches, known as the Diagnostic Accuracy and Innovation Act (DAIA), was introduced as a discussion draft in early 2017. This approach aimed to establish a risk-based and flexible regulatory framework for IVDs.
• In response to DAIA, the FDA put forth its own proposal in August 2018, which included a novel regulatory mechanism for precertifying certain tests to streamline premarket requirements.
• Subsequently, a new draft bill called the Verifying Accurate, Leading-edge, IVCT Development (VALID) Act was released in December 2018. This draft bill incorporated the FDA's feedback and was based on the DAIA approach. The VALID Act was introduced in both the 116th and 117th Congresses and was eventually incorporated into the Senate user fee bill in 2022, specifically under Subtitle C—In Vitro Clinical Tests.

A Look Inside the FDA's New LDT Proposed Rule

The Proposed Rule involves only a minor change — the addition of ten words to the IVD definition.

However, this small change has significant potential implications.

In light of the impact that this change could have, and taking into account industry feedback from previous regulatory attempts, the FDA has announced that it will phase out its general enforcement discretion policy on LDTs in five stages over a period of four years. The FDA proposes to apply this “phaseout policy to IVDs that are manufactured and offered as LDTs by laboratories that are certified under CLIA and that meet the regulatory requirements under CLIA to perform high complexity testing, even if those IVDs do not fall within FDA’s traditional understanding of an LDT because they are not designed, manufactured, and used within a single laboratory."

Phase-out stages

The FDA's intent, exceptions, and other details

• The Proposed Rule aims to ensure the safety and effectiveness of LDTs and encourage the manufacturing of innovative IVDs with a reasonable assurance of safety and effectiveness.
• Notably, the Proposed Rule doesn't include "grandfathering" provisions for LDTs already on the market, a departure from the VALID Act and previous FDA proposals.
• Certain LDT classes, like forensic tests and human leukocyte antigen tests, will be exempt from these enhanced requirements. However, other LDTs present at the time of the final rule will need to comply.
• The FDA acknowledges that this could lead to the removal of some LDTs from the market. It estimates that nearly 50% of current LDTs could be classified as low-risk and, as Class I devices, might not require premarket review under the new framework.
• The FDA reserves the right to take legal action against any LDT during the final phase-out if necessary.
• It may implement specific enforcement discretion policies for particular LDTs in future public health needs, as seen during the COVID-19 pandemic.
• The FDA is considering outsourcing parts of the IVD submission reviews through its Third Party review program to enhance efficiency.

Expected Impact of the Proposed Rule

The reintroduction of the VALID Act and the Biden administration's announcement this year to commence rulemaking, have made it increasingly likely that LDTs will soon be under stricter regulation. Should the Proposed Rule be implemented as it currently stands, clinical laboratories offering LDTs are poised to experience significant changes.

In the immediate future, impacted labs should start preparing systems that will enable them to adhere to the MDR requirements as soon as the initial phase of enforcement discretion concludes.

In the ensuing years, laboratories will need to compile evidence demonstrating not only the analytical validity of their LDTs, which is presently reviewed under the CLIA, but also their clinical validity. This involves proving the accuracy of LDTs in identifying, measuring, or predicting the presence or absence of a clinical condition or predisposition in patients.

Although strategies for complying with these regulatory requirements, including generating evidence for premarket review, are relatively well-established due to the FDA's historical regulation of other IVDs, the sheer number of tests that will undergo this new regulatory scrutiny presents challenges.

Additionally, there's a general desire to maintain access to LDTs already in the market. These factors are likely to prompt demands for clearer guidelines and reforms in clinical expectations.

Anticipated judicial challenges to the FDA's oversight of LDTs could significantly delay the publication and effective date of the final rule.

How The FDA Group Can Help

In the face of the FDA's Proposed Rule for LDTs, your lab’s future can seem uncertain, and the path forward unclear. The FDA Group is here to turn that uncertainty into a pathway for growth and compliance in what will most likely be a more highly regulated future.

Our tailored services are designed to navigate the complexities of the proposed rule, ensuring your LDTs meet regulatory expectations without losing the innovative edge that sets you apart.

Here's how we can help impacted firms take action now:

1. Regulatory gap assessment and strategic planning

We begin with a thorough gap analysis to pinpoint your current position against the looming FDA rulemaking. This process is not just about identifying shortcomings; it’s about uncovering opportunities for regulatory excellence and market leadership.

2. Compliance framework development

Transitioning your LDTs to comply with FDA, IVDR, ISO 13845, and CE standards can be daunting. Our team crafts a bespoke regulatory framework for your tests, ensuring you’re not just ready for today’s standards, but also poised for tomorrow’s challenges.

3. Submission and registration guidance/support

Navigating the FDA’s submission process requires expertise and precision. We guide you through every step, preparing submission packages and offering hands-on support during the process to ensure your LDTs achieve regulatory acceptance.

4. Continuous regulatory vigilance

Regulatory landscapes are never static, and FDA's LDT rulemaking is actively in progress. Our continuous improvement protocols keep you ahead of the curve, ensuring that your compliance is not just a one-time achievement but a sustained competitive advantage.

The FDA Group is more than a consultancy; we are your partners in regulatory excellence. Our commitment is to transform these regulatory changes from hurdles into stepping stones towards greater innovation, safety, and market success. Let’s start a conversation about your laboratory’s future. Contact The FDA Group today and discover how we can navigate the new FDA landscape together.