The Implications and Timing of the FDA Draft Rule for LDT Regulation

November 20, 2023

The FDA draft rule for regulation of lab-developed tests (LDTs) is no radical departure from the Agency’s traditional regulatory scheme, but it would force clinical labs to conduct a major overhaul of their regulatory operations. There is still a debate as to whether the Agency is fully legally authorized to regulate LDTs, but there are other considerations which suggest the FDA’s timeline for this draft rule is highly ambitious.

Earlier this year, Enzyme CEO and co-founder Jared Seehafer, RAC, expressed misgivings about the FDA’s presumed authority to regulate LDTs given that multiple legal opinions have cast doubt on that authority. Congress has offered two legislative solutions in recent years, the more recent of which is the Verifying Accurate, Leading-edge IVCT Development (VALID) Act. The failure of Congress to pass the VALID Act represents a missed opportunity in several respects, including that the legislation provides a technology certification process that could reduce the number of premarket applications. The VALID Act also would permit the use of a prospectively developed change protocol that is suggestive of the FDA’s predetermined change control plan (PCCP) concept, a feature which would further ease the premarket application demands on the Agency and on clinical laboratories.

QMSR Rule to be Finalized First

There are several interesting considerations in the draft rule, such as the statement that the Agency will conclude the Quality Management System Regulation (QMSR) proposal prior to issuing the final LDT rule. The QMSR proposal would align the Quality System Regulation (QSR) with ISO 13485 by incorporating elements of 13485 by reference rather than by rewriting the QSR. The FDA also requested feedback on whether tests that are already practiced as of the date of the draft LDT rule should be eligible for grandfathering. This grandfathering would require limited or no premarket review but might also eliminate part or all of the requirements under the QMSR. However, to be eligible for this hypothetical grandfathering status, the test must not have been modified.

The compliance requirements for LDTs will be phased in over a period of 4 years starting with the date of publication of the final rule. The FDA is considering a 5-stage approach to implementation, consisting of an end of discretion for:

  • Medical device reports (MDRs), reports of corrections, and reports of removals at the end of the first year;
  • Additional requirements such as registration and listing, labeling, and investigational use at the end of the second year;
  • Quality system requirements at the end of the third year;
  • Premarket review requirements for high-risk tests 3.5 years after the final rule, but not before Oct. 1, 2027; and
  • Premarket review requirements for moderate- and low-risk tests in the fourth year after publication of the final rule, but not before April 1, 2028.

The one-year phase-in of MDR requirements is double the 6-month window proposed by the Agency in its 2014 regulatory framework draft guidance for LDTs. The FDA stated that this change is in response to feedback from industry for the 2014 draft guidance, and that MDRs are typically the precipitating event for corrections and removals. Aligning these timelines is also appropriate according to the FDA because these sources of information work together to provide information about device performance.

Risk Classification Process Likely to be Time-Consuming

The FDA would amend Part 809.3 to clarify that IVDs are devices even when the manufacturer is a clinical laboratory. Part 809.3 lists instruments and reagents as components of an IVD product, but the draft rule goes further in stating that the definition of reagents and instruments may include articles that are similar or related to the instruments and in vitro reagents used to diagnose diseases. These individual parts may have their own regulatory identities but may constitute a new device when combined. This would seem to suggest a granularity of regulatory oversight that clinical laboratory operators could find overwhelming.

Another consideration for clinical laboratories is how the FDA will determine the risk classification for LDTs. A high-risk test would be treated as a class III product and would be subject to demands for a substantial amount of clinical evidence, as is typical of products reviewed as PMA devices. A test type with no predicate would be subject to the De Novo process, which again, may require that the application include clinical evidence even if the test is deemed a class II product. The FDA may make these determinations on a case-by-case basis, adding to the amount of time needed to sort through all the tests that will have to go through premarket review.

FDA Dismisses Value of CLIA Oversight

There are several questions the draft rule leaves unanswered, such as the regulatory status of a lab that is operated by an academic medical center (AMC). The FDA may be open to the development of a separate policy for an AMC lab, but said it is unaware of any definition of an AMC. There is also a question as to whether a longer phase-out period should apply to labs with annual receipts below a specific dollar value. The Agency proposed a threshold of $150,000, although there is no explanation as to how the FDA arrived at that figure.

The FDA may consider avoiding duplicative oversight as would be the case with laboratories that are regulated by the New York State Department of Health or the Veterans Health Administration. The draft rule acknowledged the existence of the national oversight program under Clinical Laboratory Improvement Amendments (CLIA), although the Agency states that CLIA is no substitute for FDA oversight. The FDA discounted the use of a more robust version of CLIA regulations with the rationale that a given test type would be reviewed by different agencies depending on the location in which the test was made, one of several predicaments the FDA said may lead to regulatory confusion and inconsistency.

There is a question of whether the FDA would be able to process all the premarket applications, even with the help of third-party reviewers.

It may be appropriate to question the FDA’s understanding of the time needed to implement its regulatory oversight of LDTs. First, the draft rule offers a comment period of only 60 days, an exceptionally short time for a rule with such a wide scope of effect across the clinical laboratory landscape. Additionally, the rule would have a profound impact on each clinical laboratory’s operations, but there is a question of whether the FDA would be able to process all the premarket applications, even with the help of third-party reviewers.

It may be reasonable to expect the FDA to need a minimum of a year to release a final version of a draft rule, longer if litigation is involved. The Agency acknowledges it will need user fees from labs to manage the premarket application load, which may have led the FDA to align the timing of the premarket requirements with the next Medical Device User Fee Agreement (MDUFA), which would begin Oct. 1, 2027. However, whether all these pieces can be put into place in time for MDUFA VI remains to be seen.