On July 31, FDA announced drastic changes to regulation for personalized medicine products and services when it coupled the release of the long-awaited final guidance document on the regulation of companion diagnostic devices with a proposed framework for regulating laboratory developed tests (LDTs), which was also long-awaited or long-feared, depending on your perspective.
The final guidance on In Vitro Companion Diagnostic Devices was welcomed by the personalized medicine community because in the document, FDA clarified the path for co-developed drug-diagnostic products, and finalized their assertion that new targeted therapeutics will not be kept from the market if the diagnostic kit is not ready at the same time. This enables promising new drugs to come to market while also allowing the laboratory community to fill testing needs in cases where an FDA-approved kit is not available for therapeutic selection, dosing and avoidance decisions.
However, many issues remain to be addressed.
To address concerns that FDA regulation will pose obstacles to an already challenged laboratory industry, there is a rather long transition phase — nine years — and an initial focus on high-risk. FDA defines high-risk LDTs as those with the same intended use as cleared or approved companion diagnostics, LDTs with the same intended use as an FDA-approved Class III medical device, and certain LDTs for determining the safety and efficacy of blood or blood products. This focus and transition period will allow clinical laboratories and FDA time to adjust. By focusing initial regulation on high-risk LDTs, FDA makes a strong argument for the framework, and slices off a rather small segment of the LDT market.
Many have argued that FDA does not have the bandwidth to regulate LDTs. FDA responded to this claim by reiterating enforcement discretion for the vast majority of LDTs and outlining a process for LDT regulation, which might be less onerous than traditional regulatory pathways for medical devices.
Although FDA made great efforts to address concerns about the Agency’s new regulatory enforcement, it did not address perceived conflicts between laboratory regulation under Clinical Laboratory Improvement Amendments (CLIA) and this new framework. Furthermore, FDA intends to use an expert advisory panel to provide recommendations to the Agency on LDTs risks and classification on certain categories of LDTs, as appropriate. I suspect that defining those categories will be contentious and, at times, difficult.
Investors have long argued that clarity is necessary in both regulation and reimbursement for continued advancement of personalized medicine. We now have clarity on FDA’s current thinking although many issues remain unresolved. The community has time to consider this framework and may soon have a chance to provide public comments. And finally, the pharmaceutical industry has the FDA’s assurance that targeted treatments will not be held up by co-development challenges.