Lab-Developed Tests Under New FDA Oversight – Key Changes Ahead

Today, we’re breaking down a pivotal change in the regulatory landscape for Lab-Developed Tests—or LDTs. These tests are a vital part of modern healthcare, used every day for diagnosing and managing diseases, monitoring treatments, and more. Think COVID-19 tests, blood glucose testing, or even genetic screening like HIV or HPV testing. 

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FDA Broadens Oversight of Lab-Developed Tests

About the authors
Jennifer Housden, RN, BSN*
L. Christine Lawson

Transcript

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Welcome to today’s episode of Womble Perspectives, where we’re breaking down a pivotal change in the regulatory landscape for Lab-Developed Tests—or LDTs. These tests are a vital part of modern healthcare, used every day for diagnosing and managing diseases, monitoring treatments, and more. Think COVID-19 tests, blood glucose testing, or even genetic screening like HIV or HPV testing.  

As of April 29, 2024, the FDA classified these tests as medical devices under its broadened oversight. We’ll walk through what this means for labs, healthcare providers, patients, and even the future of medical innovation.  

To understand why the FDA’s move is so significant, we need to take a quick look at the history of LDTs.  

For decades, laboratories have developed these tests to answer specific medical needs. Physicians and healthcare professionals rely on them daily because of their accuracy and their ability to provide critical diagnostic information efficiently.  

Regulatory oversight, historically, was minimal—governed mainly by the Clinical Laboratory Improvement Amendments, or CLIA. These standards ensure labs operate at a high level of quality and precision. They’ve worked well, which is why the FDA, until last year,exercised 'enforcement discretion'—meaning they chose not to fully regulate LDTs.  

But things changed last year. The FDA’s rule imposed additional oversight, marking a dramatic shift in the way these tests are regulated. Critics argued  the change was overdue, while proponents of the current CLIA system worry it’s unnecessary and may hinder innovation.

So, what does the FDA rule actually entail?  

As of April 29, 2024, all LDTs are classified as medical devices. What does this mean in practice? Laboratories must now comply with the same standards pharmaceutical and medical device manufacturers adhere to. This includes FDA inspections, labeling requirements, and increased regulatory scrutiny.  

The changes are being phased in over a four-year period, but even so, the hurdles are substantial. Compliance comes with regulatory costs such as Medical Device User Fees and Establishment Registration Fees. And that’s just the beginning. Labs may need to invest in new equipment, hire specialized personnel, and delay product implementation to meet these new standards.

Inspections also are stepping up significantly. If any discrepancies are found, there could be enforcement actions such as product seizures. It's not hard to see how these challenges could create bottlenecks that ripple outward, affecting both labs and patients.

Now, let's dissect what these changes mean for patients and labs.  

For labs, the financial burden is clear. Increased production costs, prolonged timelines for getting tests to market, and higher compliance fees could limit their ability to develop new tests. Smaller labs, especially those serving rural medical centers, may struggle to adapt altogether. 

For patients, the fallout could be even more personal. Rising costs for labs often mean rising costs for the tests themselves—whether in the form of higher insurance premiums or out-of-pocket expenses. Accessibility could also take a hit. Imagine a rural patient needing a complex test. Their local center, unable to afford new equipment or personnel, may now need to send samples to larger labs or refer patients to urban facilities. This process inevitably delays diagnosis and treatment, a cost that’s not just financial, but human.

Unsurprisingly, this rule has faced significant resistance. Organizations like the American Clinical Laboratory Association and the Association for Molecular Pathology have already filed lawsuits against the FDA. They’re supported by groups such as the American Society of Clinical Pathology and the College of American Pathologists.  

Their main arguments? That the rule is arbitrary and capricious under the Administrative Procedure Act and that it overlaps unnecessarily with CLIA's current oversight. 

Adding another twist, the recent overturning of the Chevron Doctrine could mean courts will no longer defer to the FDA’s interpretation of the law in this case. This litigation could impact not just this rule, but the FDA's authority in future regulatory decisions.

So, where does this leave us moving forward?  

The outcome of these lawsuits will be pivotal. If the courts side with the plaintiffs, the FDA may face limitations in regulating LDTs, influencing its broader authority in healthcare oversight.  

Leadership changes at the FDA, along with political shifts, could also reshape this regulatory landscape, creating further uncertainty for labs and patients. 2025 could bring monumental developments, from potential cost reductions to shifts in LDT accessibility and affordability.  

What remains clear is the need for balance. Regulation should ensure patient safety without stifling innovation or limiting access to essential diagnostics. The challenge will be achieving this balance in a way that works for labs, patients, and regulators alike.

Lab-Developed Tests play a critical role in patient care. While regulation is a step toward ensuring their safety and consistency, the costs—both financial and human—must not be underestimated. 

Thank you for listening to Womble Perspectives. If you want to learn more about the topics discussed in this episode, please visit The Show Notes, where you can find links to related resources mentioned today. The Show Notes also have more information about our attorneys who provided today's insights, including ways to reach out to them.

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