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FDA Resumes Move to Regulate LDTs, Likely Setting up Legal Battle With Lab Industry


NEW YORK – The US Food and Drug Administration is moving to regulate laboratory-developed tests (LDTs), setting up a potential legal battle with the lab industry.

In remarks at the American Clinical Laboratory Association's annual meeting this month, Elizabeth Hillebrenner, associate director at the FDA's Center for Devices and Radiological Health, said the agency is advancing plans to regulate LDTs through the rulemaking process.

Hillebrenner declined to give a timeline for when the FDA might present its plans for LDT regulation but said that the agency has started work on the effort. The move marks a resumption of the FDA's decades-long endeavor to bring LDTs under its purview.

For more than 30 years, the agency has maintained that LDTs are medical devices that fall under its authority according to the Food, Drug, and Cosmetic Act (FDCA). It has by and large refrained from exerting this supposed authority, however, adopting what it has called a policy of enforcement discretion. Perhaps the closest the FDA has come to broad regulation of LDTs was in a pair of draft guidances it released in 2014 in which it said it would require registration of LDTs and premarket approval of certain higher risk LDTs.

The agency received substantial pushback from the clinical lab and diagnostics industries, which questioned its authority over the tests, and two years later, following the election of President Donald Trump, it halted its LDT regulation plans.

In recent years, much of the action around LDT regulation shifted to Congress, where lawmakers have worked to craft legislation — most notably the Verifying Accurate Leading-edge IVCT Development (VALID) Act — that would have given the FDA authority over LDTs. VALID aims to resolve the issue of LDT regulation by creating a risk-based framework for in vitro clinical tests (IVCTs) — which would include both IVDs and LDTs — with high-risk tests, such as novel assays, required to go through FDA premarket review, and lower-risk tests allowed on the market after passing through technological certification. The law would grandfather in LDTs currently in clinical use.

VALID's supporters saw 2022 as a propitious year for the bill as the required renewal of the FDA user fee package provided a piece of must-pass legislation to which it could be attached. Ultimately, though, the bill failed to move through Congress despite the support of powerful proponents like Sen. Richard Burr, R-N.C., and Patty Murray, D-Wash., the ranking member and chair, respectively, of the Senate Committee on Health, Education, Labor, and Pensions (HELP). Since then, Burr has retired and Murray has left HELP to chair the Senate Appropriations Committee. Congress is expected to introduce the bill again this year, but with Burr, one of VALID's most prominent champions, now gone, its prospects are, if anything, more uncertain than previously, which has perhaps prompted the FDA to resume its own internal efforts on LDT regulation.

While the FDA previously tried to regulate LDTs through guidance, in its current effort it is using the notice-and-comment rulemaking process in which it must provide public notice of its plans, accept comments, and then address those comments when it produces its final rule. This is a longer, more involved process than a guidance-based approach, but observers suggest that it puts the agency on more solid legal footing.

"I think that most lawyers are really skeptical of the FDA's claim that it can [regulate LDTs] without rulemaking," said Jeff Gibbs, a director at the law firm Hyman, Phelps & McNamara, who formerly served as the FDA's associate general counsel for enforcement.

"Guidance has always been suspect," said Gibbs' colleague Gail Javitt, also a director at Hyman, Phelps & McNamara. "I take it as a positive sign that FDA appears to now also believe that rulemaking is legally required. Proceeding by guidance would be procedurally flawed and subject to legal challenge."

Whether the FDA can regulate LDTs via rulemaking also remains unsettled, though.

The ACLA has long held that the agency does not have authority over LDTs. In an interview with 360Dx this week, ACLA President Susan Van Meter reiterated that position.

"We really do think that regulating LDTs under the current medical device framework would be inappropriate and that FDA lacks the authority to do so," she said.

"There is, I think, a live question as to whether FDA really does have the power to regulate what labs are doing under the FDA law," Gibbs said. "There is no question FDA is going to run into a court challenge when they do this."

A 2020 internal memo from Robert Charrow, then general counsel at the US Department of Health and Human Services, lays out several main challenges such an effort might face. The memo argued that while, assuming it proceeded via rulemaking, the FDA would likely prevail in the argument over whether or not LDTs are medical devices, in order to regulate LDTs under the FDCA the agency would still need to demonstrate that these tests meet the definition of interstate commerce, that they are in commercial distribution, and that the laboratories performing them are legal "persons."

The memo noted that while the FDA could likely demonstrate that LDTs fell under interstate commerce, it was less clear that LDTs met the commercial distribution requirement. It added that for certain types of labs — state public health labs and academic medical centers at state universities — the legal persons standard would be impossible to meet as these are considered part of the state and "presumed by definition not to be a 'person,'" meaning the FDA could not regulate LDTs developed at these facilities.

Another potential challenge has arisen since the FDA's last stab at FDA regulation. Last year, the Supreme Court issued a decision that limited the Environmental Protection Agency's ability to cap power plant emissions due to a lack of explicit congressional authority to do so. Some have suggested this ruling could impact the activities of various federal regulatory bodies, including the FDA.

"This is an issue that hadn't percolated before," Gibbs said. The ruling "could reinforce the idea that FDA doesn't have this power because it would be a major undertaking, a major change in the federal regulatory landscape made without congressional authority."

Even if it is determined the FDA has the authority to regulate LDTs, the specifics of how the agency goes about exerting that authority will be open to a challenge.

"Are they going to proceed through rulemaking in the correct way?" Gibbs said. "There's certainly no guarantee that is the case."

"For example, they have to take into consideration substantive [stakeholder] comments and respond to them," he said. "Will FDA do an appropriate job of that? There is some deference the courts have given FDA on whether they have addressed [comments], but FDA doesn't always win those cases. And it's not going to be easy to address all the comments that will be forthcoming. There are going to be layers and layers and layers of issues that will come up under an Administrative Procedure Act challenge to the regulation of LDTs."

James Boiani, an IVD, drug, and medical device life sciences attorney at Epstein, Becker & Green in Washington, D.C., noted that the length of time required to regulate through rulemaking makes the process vulnerable to political swings such as changes in presidential administrations.

"If you're talking about the rulemaking process, that is going to be a multiyear program with a multiyear phase-in, and that is going to be subject to changes in [presidential] administrations and how they feel about laboratory-developed tests," he said. He cited as an example HHS's surprise announcement during the Trump administration that the FDA would not require premarket review of laboratory-developed tests without notice-and-comment rulemaking.

Perhaps anticipating these challenges, the FDA has maintained that its preference is for Congress to pass legislation like VALID giving it authority over LDTs.

During a recent presentation to advocacy group Alliance for a Stronger FDA, Hillebrenner said that the agency stands "ready to continue supporting Congress on the diagnostic reform legislation, VALID or otherwise."

She suggested that while the FDA plans to move forward on regulating LDTs using rulemaking, this process would be less advantageous to labs and test developers than legislation like VALID. The FDA's actions on LDTs would be "constrained to the existing [regulatory] framework," she said, noting that components of the bill viewed favorably by many in the diagnostics industry, such as the technical certification pathway, could not be implemented without legislation.

She added that under VALID, "fewer tests would require individual review" than will be the case under LDT regulation done through agency rulemaking.