Biden Administration Restores Important Safeguards for Lab-Developed Tests, Though Far Greater Oversight Is Needed

The Department of Health and Human Services (HHS) recently withdrew an August 2020 policy that severely limited the ability of the Food and Drug Administration to review coronavirus tests and diagnostic tools that are used in the same laboratory where they are made—products known as lab-developed tests (LDTs).

The Pew Charitable Trusts urged the department to make this move, which allows FDA to again review labs’ COVID-19 tests for accuracy and, importantly, step in before problematic tests are used with patients. Indeed, before the August 2020 policy was implemented, the agency found flaws in more than 80 of 125 COVID-19 LDTs it reviewed and worked with most of their developers to rectify the issues and bring the products to market.

Accurate testing is a life-and-death issue for countless patients. LDTs are used to identify the presence or risk of many serious conditions, including cancer, diabetes, cardiovascular disease, prenatal syndromes, and more. People who receive inaccurate results may pursue the wrong treatment or forgo the right one.

HHS’ reversal closes one gap in LDT oversight, but other loopholes remain. Decades-old policy still allows LDTs for other diseases and health conditions to enter the market and be used on patients without undergoing FDA review or even being registered with the agency, because the broader framework for diagnostics regulation remains woefully outdated. This glaring loophole endangers public health, and Congress should correct it immediately by passing comprehensive legislation that holds test-makers accountable and ensures that diagnostic tests meet consistent quality standards regardless of where they are made or who heads HHS at any given time.

The Verifying Accurate Leading-edge IVCT Development (VALID) Act is a step in the right direction. The bipartisan bill, which was introduced this Congress, directs FDA to implement a risk-based approach to the oversight of all clinical tests, requiring premarketing review for LDTs that pose higher risk to patients while continuing to exempt low-risk tests. The bill would also oblige all test developers to register their products with the agency, report when patients are harmed because of faulty tests, and provide information around their tests’ performance and evidence in support of their appropriate clinical use.

Unfortunately, the bill would exempt too many devices from premarket review, including every LDT already on the market, and would not provide FDA with enough tools to take action against poor quality tests once they are in use. Congress should work with HHS to close these gaps in the measure and then attach the revised bill to legislation reauthorizing medical device user fees, which it plans to pass this year.

Current regulation of clinical testing is fragmented. For example, commercially manufactured in vitro diagnostic tests (IVDs) are required to meet FDA’s risk-based standards, while LDTs are not. Although FDA has long held that all such tests fall under its regulatory jurisdiction, the agency has historically chosen not to hold LDTs to the same requirements as IVDs. Instead, the oversight of these tests is left to the Centers for Medicare & Medicaid  Services (CMS), which oversees the labs that develop LDTs and holds their tests to less stringent requirements than those regulated by FDA.

This disjointed approach has generated confusion within the industry about FDA’s authority over certain diagnostics—and the 2020 policy only added to that regulatory uncertainty. A recent Pew report found that even some lab managers do not know what constitutes an LDT.

Meanwhile, the testing industry has grown by leaps and bounds since 1976, when Congress first authorized FDA to regulate diagnostics. Over the past four decades, the number of CMS-certified labs has nearly doubled, and individual labs now often serve patients across state lines. This has rendered the current 45-year-old regulatory framework inadequate when it comes to protecting today’s patients.

The VALID Act is a positive step in addressing today’s outdated regulations. The measure reflects years of diligent work and compromise by a broad range of stakeholders representing patients, health care providers, labs, medical device manufacturers, and many others. Congress should act quickly to build on this progress and ensure that FDA has the necessary tools to protect Americans from inaccurate tests.

Liz Richardson directs The Pew Charitable Trusts’ health care products project.