On January 18, 2024, the Food and Drug Administration (FDA) and the Centers for Medicare & Medicaid Services (CMS) communicated an aligned stance on the regulation of laboratory-developed tests (LDTs). In a joint statement, leadership from both agencies emphasized the need for increased oversight of LDTs (i.e., tests developed and utilized within a single laboratory).

Originally considered lower-risk due to their simplicity and localized production, LDTs were typically crafted in small volumes by individual labs, often on an as-needed basis. However, in recent years, technological advancements, and the increased commercial presence of LDTs has driven FDA and the Centers for Medicare & Medicaid Services (CMS) to emphasis the evolving nature of these tests.

In October 2023, FDA issued a long-anticipated proposed rule aiming to align LDTs with the regulatory framework applied to other in vitro diagnostic (IVD) tests. The proposed multi-year timeline, extending through 2028, outlines a phased approach to reviews and regulatory requirements.

Underscoring the critical role of accurate and reliable diagnostic tests, the joint statement focuses on three areas:

• Critical Role of Laboratory Tests: According to the Centers for Disease Control and Prevention (CDC), approximately 70% of healthcare decisions hinge on laboratory tests, making their accuracy crucial, especially for serious conditions like cancer, where an incorrect result can have life-altering consequences.
• FDA and CMS Oversight/Proposed Changes: Historically, the FDA has exercised enforcement discretion over LDTs due to their simplicity and local use. However, recognizing the increasing complexity and risks associated with modern LDTs, the FDA proposes the new regulation to guarantee their safety and effectiveness. The move aims to subject LDTs to similar oversight as other diagnostic tests. According to the statement, CMS’s Clinical Laboratory Improvement Amendments (CLIA) program is separate in scope and purpose from FDA oversight and, while the program ensures test accuracy, it lacks expertise in assuring test functionality, a domain the FDA intends to cover.
• Importance of Reliable Testing/Regulatory Adaptation: The COVID-19 pandemic emphasized the need for reliable testing and spurred both FDA and CMS to adapt their regulatory approaches to ensure the clinical accuracy of all tests, including LDTs. This adaptation is geared towards safeguarding patients from the risks associated with inaccurate tests and promoting responsible, science-based innovation in test development.

Recognizing the importance of the debate over the regulation of diagnostic testing, Applied Policy invited guests with divergent positions on the issue to join in a discussion of LDTs at the October 2023 Northern Virginia Health Policy Forum.

During the October discussion, Anna Scrimenti, Associate Director of Public Policy and Advocacy for the Association for Molecular Pathology (AMP), expressed concern that FDA regulation would impede the ability of clinical laboratories, including many academic medical centers, reference laboratories, and community health systems, to rapidly develop, validate, and offer high-quality, innovative LDTs. This perspective was reiterated in AMP’s official comments to the FDA docket on the proposed rule.

In contrast, Zach Rothstein, Executive Director for AdvaMedDx expressed his organization’s support for FDA’s ability to clarify the regulatory definition of in vitro diagnostics to encompass tests manufactured within a laboratory setting. However, he qualified this position by foreseeing the possibility of even more public health benefit from comprehensive diagnostics regulation reform via legislation, specifically the Verifying, Accurate, Leading-Edge IVCT Development (“VALID”) Act. Mr. Rothstein’s views were reiterated in AdvaMedDx’s official comments to the docket.

With diagnostic testing rapidly evolving, a commitment to collaboration with all stakeholders will be imperative in ensuring an equitable and balanced process.