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Q&A: ACLA President Alan Mertz Discusses Citizen Petition Against FDA Regulation of LDTs

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Originally published June 10.

The American Clinical Laboratory Association on June 4 filed a citizen petition objecting to the US Food and Drug Administration's expressed desire to regulate lab-developed tests.

In the petition, the interest group representing developers of lab tests charged that the FDA doesn't have the legal authority to regulate LDTs because such tests don't meet the definition of devices, which the agency oversees under the Federal Food, Drug, and Cosmetic Act. Instead, if there are gaps in the way LDTs are regulated, ACLA favors amending the Clinical Laboratory Improvement Amendments under the Centers for Medicare & Medicaid Services, the path through which LDTs have traditionally been overseen.

The FDA has for more than three decades practiced enforcement discretion over LDTs. In recent years, the agency moved to regulate LDTs, asserting that these tests were becoming more broadly used and marketed. As such, the lab community and the FDA have been at loggerheads on this issue for several years now. LDT regulation has even divided the life sciences sector.

On the one hand, drug and device manufactures charge that current regulations for LDTs under CLIA aren't sufficient to establish the validity of complex diagnostics, given their increasing use and importance to personalizing treatments. On the other hand, the lab community believes that the FDA regulatory pathway is too cumbersome and expensive for most labs, especially since the majority of LDTs still address rare disease populations, and forcing LDTs through FDA review would hinder public access to critical tests.

"When you really look at how a device goes through a pre-market approval process at the FDA, and you try to put an LDT through that, it's really a round peg in a square hole," ACLA President Alan Mertz said. In an interview, Mertz discussed with PGx Reporter the citizen petition and ACLA's overarching position on LDT regulation.

Below is an edited transcript of the interview.


Could you talk a bit about the timing of the citizen petition? It was aligned closely with comments recently made by FDA Commissioner Margaret Hamburg regarding FDA's intent to regulate LDTs. Did you file the petition in response to her comments? Or do you believe that the FDA is about to release the LDT guidance?

There was no relation between the timing of us filing the petition and the comments that the commissioner made. We've actually been working on drafting this petition since beginning of April. In reading it you can see it's pretty comprehensive. We wanted to file it as soon as we had it, and we just finished it in the last week … The commissioner's comments were on Sunday (June 2) and we filed it on Tuesday morning (June 4). So, we certainly couldn't have written the whole thing in a day. … We also don't have any information that the guidance is imminent. So, the petition wasn't released because we thought it was coming out. We have no idea when it's coming out. But we wanted to get on the record.

I've heard industry insiders say that the LDT guidance is basically completed but currently under review by the Obama Administration. Do you know if this is the current status of the guidance?

No, but we've read the same reports.

Let's talk a bit about the definition of an LDT. In the citizen petition, ACLA states that the FDA doesn't have the authority to regulate LDTs because LDTs don't fit the definition of a device under the FDCA. It seems in your definition you're separating the constituent device components of an LDT from the LDT itself. Why isn't an LDT the sum of its parts?

That could be said of any medical service or laboratory service or anything a physician does using an instrument of some kind that is FDA approved. The idea that you're just using some components to provide a clinical service doesn't mean the service is a device. I'm not even sure that the FDA would take that point of view.

As an example, the FDA in regulating direct-to-consumer genomic testing services took action against such firms after a company tried to sell spit kits at a pharmacy. Although a spit kit is a relatively low-risk device in and of itself, in this case, because the spit kit was tied to a lab testing service that the FDA considered high-risk, the spit kit was also high-risk in the agency's view.

With respect to the direct-to-consumer labs … we don't welcome them as ACLA members. And we've basically stated that our members don't do direct-to-consumer [marketing]. That's really the distinction. We feel particularly that molecular tests or complex tests should be offered through a clinical laboratory that receives an order from a physician, and the results go back to a physician. Obviously, patients have a right to [their genomic information] but [the tests] should be ordered by a physician, and the results should go to a physician, and that's what all our members do.

We actually agree with FDA, and we sent a letter to the agency at the time [they regulated DTC firms] saying that we felt DTC genomics tests were higher risk because they were ordered without a physician and without the physician getting results. When you take the physician out of the equation we felt that it does create some risk. But this is not really an issue of whether the spit kit is a component, and therefore any tests that have components that are regulated are medical devices. The issue is DTC. The whole issue there is how they're ordered and also how they're marketed.

I recall one of the companies that came before Congress [during a 2010 hearing on DTC genomics firms] … was saying they would give consumers their risk of breast cancer … But if you looked at the fine print, it said the test didn't include the BRCA1 or BRCA2 genetic tests. So, presumably they might have told someone they have lower-than-average risk of breast cancer in their lifetime, but they didn't know if they had the BRCA gene [mutations]. Now, through the Angelina Jolie case, a lot of people have learned that [mutation carriers] have a 50 percent chance of having breast cancer and the average for the total population is 13 percent. So, someone could have had a 50 percent chance of breast cancer and they got a report from this DTC company saying they had an average risk. That is risky, and this type of [DTC] testing could never be validated under CLIA or College of American Pathologists' standards [for clinical labs].

But many LDT developers market tests DTC. In fact, BRCA testing is marketed DTC.

Now, wait a minute, you have to be careful there. The DTC companies, the way they market the test is they are encouraging someone to get the test directly without the physician ordering it. So, for BRCA, that's never been marketed directly to consumers suggesting that the consumer get the test directly from the lab without going through a physician to see if they have the family history. There is physician involvement in the test. That's different. Hospitals have advertisements, too, but they're not saying, "Hey, come into the hospital without needing to."

In the citizen petition, ACLA states that the best way for stakeholders to fix gaps in LDT regulation would be just to amend CLIA. Are there any [such gaps] that ACLA has identified in current LDT regulations under CLIA?

Under CLIA, clearly, the analytical validity is required. And actually, the lab director under CLIA has to ensure the clinical validity of the test. And labs that are doing molecular testing, they're complex labs, they're CAP accredited ... and clinical validation is part of the requirement now to have your CAP accreditation as a complex lab. So, they do look at the clinical validity.

There is a perception and … this is at least what CMS says … that it's a little unclear whether CLIA [certification] requires the clinical validity of that test. We actually disagree with that and we believe that it is required and the lab director has that responsibility and that CLIA can look at that. But since that is somewhat unclear under the regulations … then we have supported clarifying that through the legislation that Congressman Burgess has introduced. [Editorial Note: Congressman Michael Burgess (R-TX) introduced a bill two years ago called the "Modernizing Laboratory Test Standards for Patients Act," seeking to keep regulation of LDTs under the purview of CMS instead of under the FDA (PGx Reporter 10/19/2011).]

The bill goes much further than that in actually requiring all new LDTs to undergo an approval process under CLIA … and if there were problems, [CLIA] could stop them from being performed. What's not very well understood is that ... CLIA is already funded by the labs 100 percent. So, they already have the money to do it and if they needed more money, we're willing to pay more and there are user fees to have that done … [ACLA estimates] there are 1,000 new tests each year … If FDA takes this on, they're only going to look at some small subset of the high-risk tests, apparently. We were in the [Medical Device User Fee and Modernization Act] negotiations, and FDA only has enough funding … to look at may be 10 or 13 high-risk tests a year. So, the process that we supported under Burgess would require perhaps all 1,000 new tests [a year] to go through an approval process.

You could enhance CLIA a little bit, and it's funded, and it would work much better on the innovation side, and you'd also actually have the government looking at all these tests. So, that's why we're supporting the CLIA process.

Where does the Burgess bill stand now in the current Congress?

It hasn't been re-introduced this year. The problem is it's hard to get it through the Senate [because] probably the [Obama] administration has the upper hand there. And the FDA is pushing for this process. So, it would be hard to get the Burgess bill through the Senate. It would have a reasonable chance in the House.

And that's unfortunate, because as I said, I think this [bill] would better protect the public and patients, but the way it would be done wouldn't unnecessarily stifle innovation. The big problem with the FDA doing all the LDTs is that they're already quite regulated … under CLIA, by CAP, and then by New York State. So, you have three levels now, and you're adding another layer of regulation under the FDA. For most LDTs, laboratories could never go through a full pre-market approval under FDA … because they're low-volume, and the reimbursement for them is so low. They could never go through that process, because it's too expensive.

FDA's view of how lab-developed advanced diagnostics are developed and marketed are in contrast to ACLA's view of how these tests are being developed and marketed. ACLA states in the citizen petition that lab tests are performed and controlled at a single laboratory.

If it's not performed at the lab where it was developed then it is not an LDT.

But the FDA has also cited examples of tests that are being marketed as LDTs that the agency says were not developed at the lab that's performing them.

Like what?

The FDA said in a warning letter to LabCorp in 2008, for example, that its OvaSure test was not an LDT but a "medical device" requiring its approval, mainly because the test was “designed, developed, and validated by investigators at Yale University and not LabCorp."

That's not true of OvaSure. Who used that example? I guess the [FDA] commissioner did. You see, each laboratory that introduces an LDT, when you're doing it, when you're performing it, you have to establish performance specifications for the characteristics of the test before you could report the test results. So, LabCorp, in response to the warning letter they got from the FDA disputed the allegation that [OvaSure] was a medical device … LabCorp had licensed the intellectual property from Yale. That's very prevalent and common in the development of LDTs. Yale had no control over the development, the methodology, the validation, the performance characteristics, the way it's used, how it's distributed, or any other aspect of it. They had no control over any of that [for the test] offered by LabCorp.

Instead, OvaSure was ... independently validated by LabCorp and [it] had full responsibility over the validation of the test under CLIA and CAP and was in full compliance.

This just shows such misunderstanding [of the lab industry.] And this is one of the reasons we wanted to file the petition. The level of misunderstanding about how these tests are developed is amazing.

Genentech filed a citizen petition a few years ago urging the FDA to bring all diagnostics under one regulatory pathway. Some diagnostics developers also feel this way. Do think this is a good idea? Do you think that diagnostics should be developed under one pathway, whether under the FDA or under CLIA?

This is a nuanced area and we thought about this a lot. I would boil it down to this: Where a test is developed with the drug and the [FDA]-approved drug label requires or strongly recommends a test be done to use that drug, that's when we can see the FDA has to be involved in that. … Maybe this can be shared with CLIA, but certainly the FDA needs to be involved.

But at this point, it's very rare that a drug is labeled that way and the drug and test are co-developed. There are thousands of [LDTs], and the number of [companion diagnostics] that fit this description, I can count them on one hand.

In the citizen petition you do cite the example of KRAS testing where LDTs gauging mutations in that gene were available well before the FDA approved a companion diagnostic to gauge which colorectal cancer patients have these mutations and therefore shouldn't get the drug Erbitux. But now that a kit is available, that kit is still competing with LDTs that test for the same KRAS mutations. What is the solution for attenuating the commercial advantages and disadvantages that this dual system creates?

I hear this argument from device manufactures. When you're taking a position on whether LDTs should be regulated by the FDA, if that is your concern about a level playing field where [FDA-reviewed kits] are in direct competition, then we can have that discussion. But first, as in medicine, you really need to diagnose the problem. If you don't, then the solution ... to that problem is going to be wrong and it's going to have unintended consequences.

Of all the LDTs, how many of them are in direct competition with the kits? I don't know the exact number, but we know it's a very small number. Half of the new LDTs are for infectious diseases, and for most of those there are no kits. For most of the cancer tests, there are no kits for most that are developed … For the 1,000 new LDTs each year, for the vast majority of them there is no kit being developed, and for most of them there probably will never be a kit developed.

So, if your problem is this competitive issue, then put aside the [majority] of these LDTs for which there are not going to be any competition with the kits. Then we really ought to take the position that there is less of a reason for FDA to regulate most of the LDTs. Because if you're developing a test at one of our university labs to test for an infectious disease and you're going to run a few hundred of them a year, how do you put that through a $10 million PMA, when you're total reimbursement for the life of the test is going to be $10,000?

There is a difference between a lab developing a test and running that test just within that same lab, versus a kit. A kit is usually not going to be developed unless there is going to be a big market. So, if you develop a kit and you sell it to thousands of labs versus a test that Arup [Laboratories] developed that they're going to run for Mayo and they're going to run a few hundred a year, and they're going to do the validation … does the kit that is going to be run at thousands of labs warrant a higher level of regulation [than the Arup LDT]? Yes! It's only logical. It has to. That really has to be because it's sold commercially to [so many] labs. That's the distinction there.

ACLA notes in the citizen petition how perhaps if the FDA were to issue regulations on LDTs, they shouldn't issue guidance [which does not have the force of law], but should use the rulemaking process. Would ACLA be more open to FDA regulation of LDTs if the agency issued a notice of rulemaking?

The basic thrust of the petition is that LDTs aren't medical devices. So, whether FDA does it through guidance or they do it through rulemaking, that doesn't change that equation. LDTs are still not devices and they still shouldn't be regulated by the FDA. They should be regulated under CLIA.

The point we're trying to make … is that while we don't think that FDA should regulate LDTs at all, and we wouldn't support it if it were done through rulemaking, to make such a major change and do it through guidance is all the more concerning.

Finally, ACLA points out in the citizen petition how the only reason the lab community hasn't taken legal action against the FDA is because the agency has only stated its intention to regulate LDTs, and hasn't actually issued formal guidance. Is ACLA prepared to go to court against the FDA on behalf of the lab community if the agency does issue an LDT guidance?

The guidance hasn't come out. So, we haven't made any decisions [in] regard to that.

Is there a willingness among the lab community to take this issue to court if the guidance comes out?

I just couldn't comment on that. We'll have to see the guidance, and we'll have to think about that at that point.

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