Forthcoming Regulatory Changes for Lab-Developed Tests

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Summary

This spring, the FDA will issue a rule to begin regulating LDTs as medical devices. A multi-faceted legislative, legal and market response is anticipated.

Latest Activities Surrounding LDT Regulatory Oversight

In September 2023, the FDA published a proposed rule that sought to amend current regulations to make explicit that all in vitro diagnostic tests (IVDs)—including lab-developed tests (LDTs)—are medical devices under the Federal Food, Drug, and Cosmetic Act (FD&C Act). Medical device regulation has followed a risk-based, three-classification system since 1976, when amendments to the FD&C Act took effect. The proposed rule would place LDTs within this classification system and under the subsequent regulatory requirements. The FDA is also proposing a framework under which it intends to provide greater oversight of LDTs through a phaseout of its current enforcement discretion approach.

Following three months of public comments, the proposed rule is now under review by the federal government’s Office of Information and Regulatory Affairs within the Office of Management and Budget.

Preparing for Potential Regulation of LDTs

Given that the proposed rule defines LDTs as IVDs and subjects them to the FDA’s regulatory review process to assess clinical validity, clinical diagnostic manufacturers would need to re-consider both their current portfolio and go-to-market capabilities. These manufacturers would need to assess the pros and cons associated with the commercial opportunity of both in-market and pipeline assays to inform future operations. Product classifications, data expectations, and market access considerations are all elements to consider that can inform business decisions when re-prioritizing investments to support a regulated testing marketplace.

Manufacturers should prepare for shifts in oversight by developing a portfolio map of their assays which should be based on, among other factors, potential risk classification for each asset (Class I/II/III), corresponding evidentiary and transition burdens, and the expected timelines for implementation (derived from the FDA rule), weighed against the overall potential value of pursuing marketing for the assay(s).

Stakeholders With Much at Stake

The FDA is likely to encounter numerous legal and administrative challenges associated with the implementation of this rule. It will be advantageous for manufacturers to not only collaborate with the agency to support the suggested four-year phase-in process, but to proactively look to understand the path forward for transitioning their in-market or in-development LDT to an FDA-compliant IVD.  To ensure a smooth transition to long-term commercial viability, and clarity on the path forward, manufacturers can take advantage of the current window of implementation uncertainty to develop a meaningful evidentiary plan and execution process that considers their current capabilities.

Connect with Us

Avalere experts in regulatory, evidence, and market access strategy can help you navigate these evolving dynamics for LDTs, including potential regulatory changes in transition and the broader impact of these policies on patients, payers, and access. To learn more about how we can help your organization prepare and respond to the changes, connect with us or email Laura Housman at lhousman@avalere.com.

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