Additional Oversight Needed Amidst Increased Use of Laboratory-Developed Tests

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Laboratory-developed tests (LDTs) have grown beyond their originally intended use in recent years as simple tests for limited patient groups. In the context of precision medicine, they are becoming increasingly more complex and are being utilized more frequently, according to a study published in The New England Journal of Medicine. LDTs are defined as in vitro diagnostic tests that are designed, manufactured, and used in a single laboratory.¹

In the area of prostate cancer, for example, more than 50,000 tests involving a single tissue-based gene-expression assay with a list price of about $3,900 are ordered each year, for a total estimated health care cost of $200 million.² The New England Journal of Medicine article adds, “Patients presenting with an elevated prostate-specific antigen level may undergo testing with multiple LDTs in the process of evaluation and diagnosis. Although some LDTs have been incorporated into major guidelines, data supporting the health-related benefits of test use are highly variable and often lacking.”¹

Currently, the oversight of laboratories using LDTs falls under the Centers for Medicare and Medicaid Services (CMS) through the Clinical Laboratory Improvement Amendments (CLIA). However, CLIA review focuses mainly on analytic validity, (whether a test measures what the manufacturer claims it measures), rather than clinical validity (whether a test result is meaningfully associated with the presence or absence of disease), or clinical utility (whether a test improves patient outcomes). Due to this focus, test results are often inadequate, therefore compromising safety.¹

Federal regulation, particularly by the FDA, hasn't kept pace with the increased reliance on LDTs, according to the study. The historical enforcement discretion exercised by the FDA and the limited regulatory oversight has led to a substantial proportion of in vitro diagnostic tests relying on products without FDA review. The lack of comprehensive regulation raises issues related to clinical validity and utility, potentially leading to misdiagnosis, unnecessary testing, and patient stress.¹

Efforts to enhance regulation, such as the proposed Verifying Accurate Leading-edge IVCT Development (VALID) Act of 2022, have faced challenges. The bill never received a full vote in Congress, in part because of lobbying by hospitals and academic medical centers that earn substantial revenue from LDTs, the study authors noted.

“Manufacturers would have had to demonstrate analytic validity, clinical validity, and safety of tests before clinical use, with the most stringent premarketing review focused on tests with the greatest potential to cause harm. Requirements for labeling and public listing would have increased transparency and promoted access to information about the evidence supporting available tests for patients and clinicians,” the authors of The New England Journal of Medicine article wrote regarding regulations the bill would have put in place.¹

While the VALID Act was never passed, in September 2023, the FDA proposed a rule to classify LDTs as medical devices, subjecting them to FDA review of safety and effectiveness, labeling, and reporting requirements.

“The rule clarifies that the statute’s definition of ‘in vitro diagnostic products’ encompasses tests produced by individual laboratories and would phase out the FDA’s enforcement-discretion policy for LDTs,” the authors wrote. This proposed rule is still not official, however, and will most likely face legal challenges.¹

The FDA's proposed rule is a crucial step, but there is still a necessity for comprehensive legislation for effective oversight of LDTs. A potential unified regulatory framework between Congress and the FDA should focus on safety, validity, and utility. Additional safeguards, including post-marketing review and disclosure of data on care outcomes by companies producing direct-to-consumer tests, are also important factors to consider.¹

References

1. Singhal, U., Horrow, C., Kesselheim, A. S., & Morgan, T. M. (2023, November 9). Modernizing Federal Oversight of Laboratory-Developed Tests — Toward Safety, Validity, and Utility. The New England Journal of Medicine.
2. Veracyte: 2022 annual report. February 28, 2023.