Background

FDA’s authority to regulate LDTs is a long-standing topic of debate that multiple stakeholders have weighed in on during the last 25 years. The agency’s historical position is that LDTs are medical devices subject to agency oversight, and that the agency has allowed labs to operate under its enforcement discretion, except when certain higher risk factors were present. Arguments refuting FDA’s oversight of LDTs have been made by multiple stakeholders, typically focusing on the absence of a specific delegation of authority by Congress. FDA’s last attempt to solidify its authority, when the agency announced plans to issue guidance documents in 2014, was met by strong pushback from industry and several members of Congress. By 2016, FDA was forced to halt its efforts to regulate LDTs through guidance, with all parties generally accepting that the pre-guidance status quo would continue until Congress clarified the scope of FDA’s authority through legislation. FDA’s enforcement for high risk LDTs during this time included, for example, companion diagnostic uses, direct to consumer applications, tests developed by multiple parties, LDTs used during emergencies and certain health crises, and other high risk applications (e.g., cancer screening, prenatal screening, etc.).

The conflict over FDA’s authority to regulate LDTs came to a head most recently during the COVID-19 public health emergency when FDA initially required notification and EUA (or state laboratory review) for LDTs used to detect SARS-CoV-2 genetic material, antigens, or patient antibodies, only to have the U.S. Department of Health and Human Services (HHS) retract and then later re-instate FDA’s guidelines related to LDTs. Specifically, in August 2020, after FDA had already been acting through guidance documents to regulate COVID-19 LDTs, HHS (under the Trump administration) announced the rescission of guidances and other FDA issuances concerning premarket review of LDTs, as we summarized online here. HHS said FDA would not from that point forward require premarket review of LDTs “absent notice-and-comment rulemaking, as opposed to through guidance documents, compliance manuals, website statements, or other informal issuances.” This HHS announcement effectively upended more than 30 years of established FDA policy and constructively ended FDA’s authority over a wide variety of LDTs (including a large number of COVID-19 LDT diagnostic tests with already-issued EUAs). However, in November 2021, following a change in Administration, HHS withdrew the controversial Trump-era HHS Policy Change regarding LDTs, as we summarized online here. In the statement announcing this change, HHS Secretary Xavier Becerra said that the withdrawal is intended to help “ensure that COVID-19 tests are accurate, reliable, and available.”

Notably, while FDA and HHS openly feuded over how to regulate LDTs during the pandemic, similar disagreements were playing out on the Hill, with Congress considering dueling LDT-related legislation, including: S. 3512, the Verified Innovative Testing in American Laboratories (VITAL) Act of 2020, which would exclude FDA authority for reviewing LDTs and place laboratory developed testing procedures solely within the CLIA process; and S. 3404, the Verifying Accurate Leading-edge IVCT Development (VALID) Act of 2020, which would establish a regulatory framework to place LDTs in a new product category called in vitro clinical tests (IVCTs).

Senate proposal

As noted above, embedded within the many provisions of the U.S. Senate HELP Committee’s discussion draft of their FDA user fee program reauthorization package (FDASLA), the committee included Subtitle C: a 245-page provision mirroring the VALID Act. The proposal would create a new regulatory classification of products under FDA’s regulatory oversight — in vitro clinical tests (IVCTs) — which would include IVDs and LDTs. IVCTs would be regulated under this new statutory framework separate from medical devices. Presently, IVDs are regulated under the medical device regulatory framework, and LDTs are primarily regulated under CLIA.

FDASLA lays out the process by which currently marketed IVDs and LDTs could come into compliance with the new system. FDASLA says that diagnostic products that are currently legally marketed would be “grandfathered” in, and need not be re-reviewed; in addition, LDTs being offered in high-complexity CLIA laboratories as of the date of enactment of the FDASLA could continue to be offered. However, FDA could seek information about grandfathered IVCTs under the proposal, and these products could continue to be offered only so long as they stay within the parameters of their grandfathered status. The overall architecture of the IVCT system would be similar to the medical device regulatory framework.

Risk categories include new “moderate” level

The IVCT system includes risk-based categorizations that inform the pertinent premarket review pathway, similar to the medical device regulatory framework, but FDASLA also adds in a third category for “moderate risk” tests:

1. Low risk (exempt from pre-market review): Tests for which an undetected inaccurate result from such in vitro clinical test, or such category of in vitro clinical tests, when used as intended would cause only minimal or immediately reversible harm, and would lead to only a remote risk of adverse patient impact or adverse public health impact, or sufficient “mitigating measures” are able to be established and applied.

2. High risk (full premarket review): Tests for which an undetected inaccurate result, when used as intended, has the substantial likelihood to result in serious or irreversible harm or death to a patient or patients, or would otherwise cause serious harm to the public health.

3. Moderate risk: Tests that would otherwise meet the high-risk classification, but to which mitigating measures have been applied, or would be expected to produce “non-life-threatening” injuries or present a “reasonable risk” for users or public health.

The previously introduced version of the VALID ACT included only definitions of “high risk” and “low risk” IVCTs.

Premarket pathway framework expands tech certification program

There are three general premarket pathways under the bill:

1. Full premarket review: FDA would review proposed labeling, comprehensive data on the product’s safety and efficacy (including both summary information for all supporting validation and “new raw data for each study”), a “proposed change protocol” for any potential modifications they would seek to fall within the scope of approval, and documentation on quality systems.

2. Abbreviated premarket review: Certain individual IVCTs for which full review was not required could be reviewed in a more streamlined fashion, based on an FDA review of their proposed labeling and summary data, but sponsors would not necessarily need to include quality requirement information or “raw data, unless explicitly requested” or data on software validation, electromagnetic compatibility, and electrical safety.

3. Technology certification: While not technically a premarket review pathway, this process would allow developers to submit a “representative test” to FDA and seek certification for marketing that type of technology without needing regulatory review for each individual product within the technology type.

The latter two pathways would generally be expected to apply to “moderate risk” IVCTs.

The bill specifies the types of tests exempted from FDA review, which would include low risk IVCTs, those that were 510(k) exempt under the current medical device regulatory framework, manual tests, those under certain humanitarian exemptions, custom and low-volume tests, and those used for public health surveillance. On the other hand, full premarket review would apply to high risk tests, first-of-a-kind direct to consumer (DTC) tests, those intended for home use, and cross-referenced diagnostics (i.e., companion diagnostics), and combination products.

FDASLA further includes a very narrowly defined exemption for IVCTs that are subject to Humanitarian Device Exemption (HDE) authorization through a Humanitarian Use Designation or are IVCTs that would be eligible for HDE review and that are “intended to inform the use of a specific individual or specific type of biological product, drug, or device.” This provision was not included in the most recent 2021 version of VALID Act proposal, and appears also to have raised some confusion in published commentary about FDALSA. To be clear, the exemption for HDE tests and ability to request exemption for tests used with drugs or biologics that would be reviewed under the HDE subsection does not appear to be intended to permit exemption of broad swaths of complementary or companion diagnostic tests.

Regarding category three above, if a test is eligible for technology certification and the developer has such a certification, then no premarket review would be necessary. However, if the developer does not have a technology certification for that technology or the IVCT is not eligible for technology certification but does not rise to the bar of full premarket review as a high risk IVCT, then that test would fall under the abbreviated premarket review pathway.

FDASLA also addresses “breakthrough technology” by directing FDA to establish a program that “promotes efficiency and flexibility in order to expedite the development and priority review” of tests deemed to be breakthrough technology.

Postmarket review requirements

The bill sets up basic regulatory requirements for LDT developers that resemble the requirements under the current FDA medical device regulatory framework; this includes registration and listing, labeling, adverse events reporting, corrections and removals, and test design and quality requirements (QR). However, the rules would vary based on the developer’s Clinical Laboratory Improvement Amendments (CLIA) certification level. FDA would have the authority and onus to issue regulations on QR, including rules related to management responsibilities, quality audits, personnel, design, document and purchasing controls, acceptance activities, traceability, servicing, CAPAs); this would be in addition to accounting for the regulation of laboratories under CLIA.

Another notable difference between FDASLA and the VALID Act are new considerations for IVCTs that are not necessarily test kits, but “test protocols.” The VALID Act said that an IVCT may include a “test protocol or laboratory test protocol,” and it laid out considerations for labs distributing test protocols (as opposed to test kits). The new FDASLA provision adds clarifications on which entities will face regulatory responsibilities when establishing/implementing a test protocol – not just a test kit.

Next steps

The proposal sets the effective date for October 1, 2027, permitting a five-year regulatory transition period. Having a set date could become an issue for the agency and stakeholders alike, as FDA is likely to be flooded with submissions towards the end of the transition period.

The Senate’s version of the FDA user fee reauthorization legislation is called a “discussion draft” because it was not formally introduced, but instead is being circulated among lawmakers to receive feedback. The Senate is expected to introduce and mark up a final version of the legislation in the next two weeks. Once finalized, the Senate’s version will then need to be reconciled with the Food and Drug Amendments of 2022 (FDA2022), which is the U.S. House version of the user fee package (H.R. 7667).

Although the House’s proposal did not include provisions related to LDT oversight, some House Representatives have indicated they would like to see LDT reform language added into their chamber’s version of the legislation before it goes to a floor vote; for example, U.S. Rep. Larry Bucshon (R-IN), one of the initial co-sponsors of the VALID Act, in March expressed disappointment that LDT reform legislation was not included as part of user fee discussions, and Rep. Diana DeGette (D-CO), another of the original VALID Act co-sponsors, said she would like to get the VALID Act included in the House user fee package. That said, there has also been notable push back in the House at the notion of granting FDA explicit authority to regulate LDTs, with multiple industry groups lobbying to elevate that concern. House Lawmakers said their goal is to get a final version of the package to the President’s desk before the August recess.

Once FDA user fee reauthorization legislation is signed, the agency would be required to establish a public docket within 30 days of enactment to solicit feedback on implementation and classification criteria, with a public meeting held within six months. Then, within 2.5 years of enactment, FDA would need to issue final guidance on applicability requirements, and within three years of enactment, would need to issue final regulations effectuating those policies. However, it should be noted that, in its current form, the IVCT amendments would not become effective until October 1, 2027 (i.e., the effective date). Thus, steps taken to implement the proposed IVCT framework between the date of enactment and the effective date would not take force until the effective date, unless otherwise noted in the legislative text. This is not to say that FDA could not act within the scope of its current authority to institute changes in anticipation of the regulatory transition, only that the delegation of authority from Congress to FDA is limited until the IVCT amendments become effective.

We will continue to monitor and track this legislation as it moves through Congress. If you have any questions about regulations related to in vitro diagnostics, you may contact any of the authors of this alert or the Hogan Lovells attorney with whom you generally work.

Authored by Randy Prebula, Blake Wilson, Brooke Bumpers, Susan Tiedy-Stevenson, and Erkang Ai.