Since the passage of the Medical Device Amendments of 1976, FDA has regulated in vitro diagnostic (IVD) tests as medical devices, subject to a full suite of FDA requirements. During that time, FDA has also asserted that it has the authority to regulate in-house tests developed and performed by CLIA-certified, high-complexity clinical laboratories (generally referred to as laboratory-developed tests or LDTs) but chose as a matter of enforcement discretion not to regulate LDTs. Over time, the Agency chipped away slowly at LDT enforcement discretion, carving out certain kinds of tests (e.g., direct-to-consumer LDTs) and thus making them subject to regulation, but by and large did not take broad steps to regulate LDTs.
FDA’s approach changed in 2014 when it issued draft guidance describing a plan to phase out FDA enforcement discretion and regulate LDTs. The guidance created some controversy, raising concerns about statutory authority (with some arguing that FDA lacked the authority to regulate LDTs), process (with objections to changing a longstanding regulatory posture through guidance), and practicality (with concern about how FDA could handle an influx of responsibility over LDTs). The draft guidance was withdrawn shortly before the beginning of the Trump Administration.
However, interest in FDA regulation of LDTs continued to garner bipartisan support, particularly in development of new statutory authority that would address the concerns FDA’s guidance approach had created. After introduction of legislation in past Congresses that failed to advance, the Senate recently attached the “Verifying Accurate Leading-edge IVCT Development Act of 2022’’ (the ‘‘VALID Act”) to its first draft of “must pass” user fee legislation. The bill will be going through mark-ups over the coming days, potentially with hearings thereafter, so it could be subject to change or dropped entirely, but the attachment of the language to the Senate HELP draft reflects a high likelihood that the legislation, in some form, will become law.
Key Provisions of the VALID Act
Similar to prior drafts, the foundational feature of the VALID Act is the designation of a separate regulatory pathway for “in vitro clinical tests”, which is broadly defined to include both traditional IVDs and LDTs. The VALID Act would impose requirements and authorities governing premarket review of the tests, registration and listing of the tests, test design and quality, labeling, adverse events, and corrections and removals. It would also provide for postmarket surveillance obligations and specify how a test may be considered adulterated or misbranded for purposes of enforcement.
The text of the VALID Act contemplates that, once implemented, new FDA[1] regulations would follow pursuant to standard notice and comment rulemaking to implement the various components of the new regulatory scheme. For example, specific quality system regulations would be set forth for developers of in vitro clinical tests that will take into account existing CLIA regulations and cover topics such as management responsibilities, quality audit requirements, personnel, design controls, document controls, identification and traceability, production and process controls, nonconforming tests, corrective and preventative action, labeling and packaging controls, and complaints and records.
With respect to existing LDTs that have been subject to the historical enforcement discretion, the VALID Act would allow exemptions for certain tests from the premarket review requirements, including, in particular, grandfathered tests that were first offered for clinical use by a laboratory prior to the date of enactment. However, if the test is modified or FDA otherwise finds that there is insufficient supporting scientific evidence, that there are deceptive or fraudulent claims being made about the test, or that there is risk of the test causing serious adverse health consequences, then the test’s exemption status could be revoked, thereby making it subject to the new regulations. Importantly, grandfathered tests must still comply with the listing requirements of the VALID Act, and developers of existing in vitro clinical tests (including LDTs) would have one year from the date the listing system becomes available to come into compliance.
The VALID Act also includes a provision allowing FDA to accredit persons both for the purpose of reviewing applications for premarket review once the VALID Act becomes effective and for the purpose of inspecting the developers submitting such applications. The VALID Act would impose a 30-day deadline on FDA to review recommendations made by any such accredited person with respect to a premarket application. This added mechanism is likely an effort to mitigate the anticipated significant volume of applications that FDA will receive.
All amendments under the VALID Act would take effect on October 1, 2027, but certain sections (including the registration and listing requirements, once the system is made available by FDA) are allowed to begin implementation as early as October 1, 2024. The language clarifies that any guidance or regulations issued pursuant to the amendments in the interim shall not be implemented or take effect until the effective date of the VALID Act, essentially allowing for at least a five-year transition period.
Conclusions
If enacted, the VALID Act will take years to fully implement, but could have far reaching consequences for diagnostics development, and the standards for diagnostic tests in the U.S. Laboratory compliance functions will certainly need to evolve and grow to navigate the addition of FDA requirements. In addition, the changes in law will create investment opportunities, as new FDA legislation of this magnitude often results in business exits and consolidations (e.g., mergers between laboratories, or between laboratories and currently FDA-regulated IVD manufacturers), as well as growth of service industries that would support new regulatory efforts. Also, there could be strong opportunities for growth for those businesses that can anticipate, effectively advocate for, and navigate the final path of regulation as it is translated from statute to FDA regulation and guidance.
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[1] As with most FDA legislation, authorities are assigned to the Secretary of Health and Human Services, which in turn has standing policies to delegate responsibilities of the Federal Food, Drug, and Cosmetic Act (to which the VALID Act will be added) to FDA. We presume the Secretary will take a similar delegation approach here, although it could theoretically administer the statute in a different fashion. A recent example of this was during the Trump Administration, when the Secretary overrode FDA policies on Covid-19 LDTs that imposed requirements on premarket review.
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