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Virus Testing Push Leaves FDA Lab Oversight in ‘a Bizarre Limbo’

Aug. 26, 2020, 9:40 AM

More tests to screen for a variety of ailments will hit the market without FDA oversight under an HHS policy meant to make more Covid-19 tests available, muddying the debate over the agency’s role.

While the Food and Drug Administration oversees tests developed by commercial companies like Quest Diagnostics, it has more sparingly applied its authority over individual tests developed by labs at health-care centers and universities. The FDA had required an emergency use authorization for these lab-developed tests (LDTs) for Covid-19, but last week the Department of Health and Human Services did away with even that cursory oversight to cut red tape. However, that order goes beyond just coronavirus tests, waiving FDA oversight over all tests from laboratories.

The move leaves those laboratory tests in regulatory limbo, and reignites a long simmering debate over whether commercial tests and laboratory tests should be regulated differently. It’s a pressing question as a new generation of complex diagnostics can screen millions of DNA changes in a single test.

The lax oversight threatens to repeat mistakes made early in the pandemic when the FDA tried to ramp up antibody testing capacity by allowing state health departments to approve the tests, Kalah Auchincloss, senior vice president of regulatory compliance for Greenleaf Health and a former FDA deputy chief of staff, said in an interview. The FDA ultimately tightened its oversight of antibody testing amid questions about their accuracy.

“It’s like we learned nothing from the serology testing in the spring,” Auchincloss said. “The thought that this is somehow going to spur innovation while not compromising safety is just absurd.”

The latest FDA policy—which came from the HHS and not the agency itself—said the FDA won’t require review of lab developed tests before they come to market unless there’s a formal rulemaking process. Developers of those tests can voluntarily undergo FDA review, which will give them liability protection under the Public Readiness and Emergency Preparedness Act.

The FDA had proposed regulating laboratory tests in 2014 to ensure their accuracy, but dropped that effort in favor of legislation. Laboratories had argued they were already regulated under the Centers for Medicare & Medicaid Services’ Clinical Laboratory Improvement Amendments. The debate appeared to be on its way to a legislative resolution before the pandemic hit.

‘A Bizarre Limbo’

While PREP Act immunity can be a big deal, the HHS announcement leaves several questions up in the air, Auchincloss said. Does it mean these laboratories must still meet certain requirements or are they just not a regulated industry at all, she asked.

“It kind of leaves the rest of the diagnostic world in a bizarre limbo,” Auchincloss said.

Prior to the policy change, FDA was issuing guidance, reviewing submissions, and authorizing the emergency use of diagnostics for Covid-19 tests developed by laboratories as well as those manufactured and distributed by commercial manufacturers, Cathy L. Burgess, an FDA attorney with Alston & Bird LLP, said. Dropping oversight of laboratory tests means the performance standards for two groups of tests could be quite different, she said.

But Mark Barnes, an attorney with Ropes & Gray LLP, said the change responds to criticism that the emergency use authorization requirement was inconsistent with how the FDA has traditionally overseen laboratory tests.

“It is not surprising that the FDA reversed course here, but it is somewhat surprising that it took so long for the reversal to happen,” he said.

James A. Boiani, an Epstein Becker Green attorney whose specialties include in vitro diagnotics, said it was surprising the policy change came through the HHS, but it wasn’t necessarily a revolutionary change. FDA review of tests coming out of labs has been the exception.

“In the coming months, as the pandemic shows little sign of slowing, we’ll see more pushes to modify policies, at least at the edges, to move products through FDA more quickly. I think by and large FDA has been doing a very good job playing clean-up on a series of public health dilemmas they didn’t create. But there is room for improvement still,” Boiani said.

To contact the reporter on this story: Jeannie Baumann in Washington at jbaumann@bloomberglaw.com

To contact the editors responsible for this story: Fawn Johnson at fjohnson@bloomberglaw.com; Andrew Childers at achilders@bloomberglaw.com

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