The FDA’s loss in a district court lawsuit over the final rule for lab-developed tests (LDTs) was a watershed moment in the history of regulation of these tests, although the agency may yet appeal the decision. The outcome of the case, even if it stands, does not eliminate the FDA’s authority to indirectly oversee the operation of these tests, given that several products used in clinical labs still fall within the definition of a regulated medical device.
As we previously explained, the FDA’s April 2024 final rule for LDTs used a phased-in approach to compliance, which would have required premarket submissions for high-risk tests by November 2027. Requirements for medical device reporting under Part 803 would have been in place as of May 6, 2025, and quality management requirements would have gone into effect two years later. These compliance deadlines would have overlapped with the compliance deadline for the FDA’s Quality Management System Regulation (QMSR), which will be in force Feb. 2, 2026.
Hazards remain for promotion of reagents, collection kits
The ruling in ACLA v. FDA states that an LDT is a methodology or process by which the lab generates clinical information about a patient specimen for use by the treating physician. However, the decision leaves undisturbed the agency’s jurisdiction over products such as reagents and specimen collection kits. Consequently, manufacturers of these products must remain mindful of the continued FDA oversight.
Now that the FDA’s authority to regulate LDT has seemingly evaporated, clinical labs may be able to promote their LDTs, a practice that led to an FDA warning letter in 2019. Promotions of reagents and other products are still clearly under FDA scrutiny, however. The agency issued a warning letter in March 2024 which cited the recipient for marketing a research use only (RUO) reagent for non-research purposes. Similarly, an October 2024 warning letter cited the maker of a self-collection kit for marketing the kit without first obtaining a 510(k). There is no suggestion in the ACLA decision that the FDA’s authority to regulate these products was in question.
The ruling does not affect the agency’s authority to regulate in vitro diagnostic test kits, including kits that are sold to be performed on clinical laboratory instruments. These kits qualify as tangible items, fulfilling one of the requirements for FDA jurisdiction, and are shipped across state lines, another qualification for FDA jurisdiction.
Conversely, the question of whether the FDA has authority to regulate software was raised in the ACLA case. Judge Sean Jordan wrote that the FDA has asserted its authority to regulate software despite that software is not a tangible good. Jordan stated further that the Supreme Court’s 2007 decision in Microsoft v. AT&T seemed to suggest that software is an intangible good, although Microsoft was a patent case.
As a point of reference, Section 201(h)(1) of the Food, Drug and Cosmetic Act defines a device as “an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent or other similar or related article.” Whether this language could be construed to exclude medical software from FDA oversight was already a point of debate prior to the ACLA decision. The controversy over the FDA’s final guidance for clinical decision support (CDS) software could serve as a test of the theory that software is not a tangible item and thus escapes the agency’s regulatory purview, particularly given the Supreme Court’s June 28, 2024, decision in Loper Bright, which brought an end to four decades of reflexive court deference to federal agency interpretation of the statute.
Decision in ACLA may affect guidance
The outcome in ACLA is likely to exert a ripple effect that may not settle fully until well into 2026. Among the questions raised by the ruling is the scope of several FDA guidance documents, such as the May 2024 draft guidance for tests used for public health response in the absence of a declaration of a public health emergency. A particularly pointed question for makers of pharmaceuticals and biologics is how the ruling affects these products when the therapeutic product label refers to an LDT as a companion diagnostic (CDx). The LDT question could also have a significant effect on the agency’s CDx pilot program for LDTs used to evaluate patient response to oncology therapies.
The FDA has 60 days following the court decision (or until May 30, 2025) to appeal the decision to the Court of Appeals for the Fifth Circuit, but the agency has not indicated whether it intends to appeal. One of the more pressing questions for labs that already have cleared or approved an LDT is whether those marketing authorizations are still meaningful. The status of pending premarket applications is presumably up for debate as well. More than one state, including but not limited to the state of New York, have their own LDT certification programs, which are untouched by the outcome of ACLA v. FDA.
Congress may yet intervene in the LDT problem by passing the Verifying Accurate Leading-edge IVCT (VALID) Act, which was under consideration during the 118th Congress. At present, there does not appear to be a successor bill in play for the 119th Congress. Rep. Diana DeGette (D-Colo.) commented on the LDT final rule in an April 2024 press release, but VALID Act co-author Rep. Larry Bucshon (R-Ind.) did not stand for reelection in 2024, casting doubt on whether any LDT legislation has the support needed to ensure passage this year.
