CEO SUMMARY: As one response to the FDA’s efforts to regulate laboratory-developed tests, some large labs and IVD manufacturers organized the Diagnostic Test Working Group. It has engaged with congressional officials to draft legislation that would establish a risk-based review of both laboratory-developed tests and in vitro diagnostic test kits, changing current regulatory protocols for manufacturers and establishing new requirements for labs within the FDA—naming these tests in vitro clinical tests (IVCTs).
ANY PROPOSAL TO REGULATE laboratory-developed tests (LDTs) has a degree of controversy within the clinical laboratory, device manufacturing, and patient communities. That controversy stems from competitive business interests between labs and manufacturers and vocal concerns among patients who want the promise of precision medicine with specific protections in place.
Such is the case with the latest idea to regulate LDTs. In March, U.S. Reps. Larry Bucshon, MD (R-Ind.) and Diana DeGette (D-Colo.) released a legislative discussion draft called the Diagnostic Accuracy and Innovation Act (DAIA) for comment. (See TDR, April 24, 2017.)
The approach of the proposal has the support of the nation’s largest labs and would formally allow the FDA to regulate laboratory tests. “However, this bill does not use the term ‘laboratory-developed test (LDTs),” stated Julie Scott Allen, Senior Vice President of the District Policy Group in Washington, D.C. Allen represents the National Independent Laboratory Association (NILA). “Instead, this bill would create another new classification of tests, to be called in vitro clinical tests (IVCTs).”
In an interview with THE DARK REPORT, Allen outlined important factors for labs to consider when assessing the current language of the DAIA. The business concerns are substantial, particularly for smaller labs entering or expanding within this market.
New FDA Oversight Role
“In this proposed bill, lab directors are likely to be concerned whether their tests will be subject to new requirements, given limited grandfather protections,” she noted. “Labs will also need to understand: a) how their lab will meet new FDA requirements and related inspections; b) how the FDA will respond if it finds something wrong with a test; and, c) ultimately how much labs will need to pay in user fees to support the new FDA regulatory structure.
“The foundation of this bill is the proposal that the Diagnostic Test Working Group (DTWG) outlined last year,” she explained. “The DAIA incorporates that same approach. Last year, the House Subcommittee of Energy and Commerce put out a working draft of the DTWG’s proposal. This latest version in the DAIA is the second or third iteration of that working group’s approach.
“Through this process, the principles of the DAIA are the same: That the FDA would be the overriding authority for regulating the clinical validity of tests, and that authority would rest in a new infrastructure within the FDA that does not yet exist,” said Allen. “Also, in an effort to level the playing field for device manufacturers and laboratories, diagnostic test kits would no longer be regulated as medical devices and thus subject to the 510K approval process.
“The fact that IVCTs—whether the IVCT is a manufactured product or a lab protocol—would not be classified as medical devices is key to this bill,” she continued. “That’s because labs would not want to submit tests for FDA pre-market clearance under the same requirements that the agency uses to review and approve medical devices.
“That pre-market clearance review and approval process is time-consuming, costly, and thus potentially fatal to a lab developing a new diagnostic test,” added Allen. “However, manufacturers, which would still be subject to such requirements when developing new assays, don’t believe labs should get a pass.
IVCTs Are Not Devices
“Even if IVCTs are not regulated as medical devices, the draft legislation would authorize the FDA to regulate these tests,” noted Allen. “That could be problematic for a couple of reasons.
“First, within the FDA, the same individuals involved in the oversight process for medical devices—many of whom were involved in recent FDA LDT oversight proposals issued through draft agency guidance—will oversee these tests,” she explained. “These individuals are likely to have the same kind of thinking about the type of clinical evaluation these tests require.
“Second, there will be consideration about the validity of the data or studies the labs submit to support these tests,” Allen added. “The DAIA proposal seeks to impose limits on how far the agency goes by limiting how much time the agency has to make decisions about whether the data supports a lab’s claims to validate a test. If the FDA doesn’t act in a certain amount of time, the approval goes forward anyway.
FDA Speed of the Essence
“The act is designed to minimize concerns about how much time it will take the FDA to evaluate IVCTs,” she explained. “There are provisions in the bill that seek to have the tests’ risk level reduced if the test meets certain metrics.
“Those are some features of the draft bill that labs are likely to support,” Allen said. “But this draft bill raises lots of questions that should concern patients and should also concern laboratories.
“For instance, there is no language in the bill to outline what happens if something goes wrong with a test. Would additional review be required?” she asked. “Or should a test’s original risk level be raised until it is proven safe? If so, what does that process look like?
“These issues should not be left unaddressed because, once a new complex regulatory structure is set in place, the government can go further,” observed Allen. “Any discussion about the oversight of lab tests must also ensure patient protections. We do not want to have something bad happen with any IVCT and then have that one bad example cast a black eye on the industry.
“Labs will want to ensure that there are checks and balances in any bill that moves forward,” she added. “Checks and balances are important because we know, for instance, that when more stringent protections are imposed under a new law, innovation can be stifled. And no one in the lab industry wants to limit innovation.
“At the same time, the lab industry has the goal of ensuring that tests are accurate and that there are protections for patients,” she said.
“To date, a large number of labs have been leery of supporting such a new bill,” noted Allen. “That lack of support is because someone needs to pay for this new process to review IVCTs. Under this bill, that new process would be incredibly expensive because the bill would authorize the establishment a new operation within the FDA. As a result, labs would have to pay new first-time user fees.
“Getting IVCTs through a new process quickly will require more staffing than currently exists at the agency,” she added. “To do so, the bill calls for user fees and other undefined funds, which labs don’t pay now.
“User fees can be high, and it’s unclear how a lab that has very few tests would need to pay into such a new system,” commented Allen. “Or, would a laboratory that very rarely introduces a new test need to pay for this new system? If it has one test, would it need to pay a substantial fee to the agency?
“In addition to these issues, there is the concern about the existing payments that are required of all laboratories,” commented Allen. “At a time when Medicare and private payers are cutting the prices they pay for lab tests, it is not the most auspicious time to introduce new user fees.”
Contact Julie Scott Allen at 202-230-5126 or Julie.Allen@dbr.com.
Could Proposed New Federal Bill For LDTs Create Overlap With CLIA Regulations?
ONE AREA OF CONCERN REGARDING the Diagnostic Accuracy and Innovation Act (DAIA) is whether it will create overlap among agencies that regulate labs, said Julie Scott Allen, Senior Vice President of the District Policy Group in Washington, D.C.
“Labs already have CLIA oversight, and FDA review would be a new process. Would those two be duplicative in any way?” asked Allen, who represents the National Independent Laboratory Association. The draft legislation attempts to compartmentalize the oversight, leaving all lab operations to CLIA, but for a smaller laboratory, would the defined review processes of both agencies work, given how these labs are structured?
“NILA’s position has been that, with the exception of high-risk tests, CLIA oversight should continue to be the core regulatory oversight process for laboratory-developed tests/protocols,” commented Allen. “NILA believes that CLIA should be modernized because it has been around since the late 1980s, and the testing market has evolved greatly since then. It could be that some simple changes could be made to address many of these issues.
“For example, we should be talking about how proficiency testing plays a critical role in test oversight, given the importance of PT in ensuring how a test performs in the field,” she said.
“The current PT process would not currently work for some lab IVCTs, but could work under a modified PT program,” Allen said. “NILA says systems like the one used for PT could be a practical way to ensure safety of new lab IVCT tests without breaking the bank for labs. And, a PT-like review system already comes with the infrastructure that labs understand.
“Rather than trying to boil the ocean to create an entirely new costly and complex regulatory infrastructure at a time when the Trump Administration and incoming FDA Commissioner want to reduce the federal regulatory infrastructure, it may be more palatable to simply make improvements to current operations, like CLIA oversight and modernization of proficiency testing,” concluded Allen.