How Did We Get Here?
Diagnostic products, including IVDs, generally provide information about a patient’s health. The FDA considers LDTs to be a subcategory of IVDs designed, manufactured, and clinically used within a single laboratory with Clinical Laboratory Improvement Amendments (CLIA) certification to perform high-complexity testing—although the industry has construed the category a bit more broadly to include tests manufactured and offered beyond the single laboratory in which a test was designed.
For decades the FDA maintained a policy of enforcement discretion for LDTs because they were low risk, used relatively simple manual techniques, were performed in small volumes, and were used for specialized needs of a local patient population. The industry, however, has long challenged the FDA’s authority to regulate LDTs, pointing to the regulation of laboratories as a whole under CLIA as a clear Congressional mandate for the Centers for Medicare and Medicaid Services, rather than the FDA, to regulate this space. Nonetheless, citing advancements in technology that make many modern LDTs much more complex, the broad marketing and sale of modern LDTs, and consequential healthcare treatment decisions made in reliance on the results of LDTs, the FDA’s final rule amended the regulatory definition of IVDs to clarify that all IVDs, even if manufactured in a laboratory, are medical devices, and ended its historic enforcement discretion policy regarding LDTs. As a result, laboratories that offer LDTs must comply with the FDA’s medical device regulations absent an exception.
The FDA intends to end its enforcement discretion policy over many LDTs in stages, requiring laboratories to first comply with various reporting, complaint, and correction and removal regulations in Stage One; comply with registration, listing, labeling, and other requirements in Stage Two; and comply with quality system reporting in Stage Three; before eventually complying with premarket review and approval requirements for high-risk devices in Stage Four, and all devices in Stage Five. For laboratories, it could be a long, and expensive, road ahead.
But Does My Laboratory Have to Comply?
By May 6, 2025, the FDA expects most laboratories offering LDTs to comply with medical device reporting (MDR) requirements, correction and removal reporting requirements, and the Quality System (QS) requirement to maintain and review records of complaints. The only laboratories that are exempt from complying with these Stage One requirements (and all other Stages, too) are those that solely manufacture the following four categories of tests:
- 1976-Type Tests: LDTs that have characteristics common to LDTs offered in 1976—including relying on manual techniques (without automation) performed by laboratory personnel with specialized expertise using components legally marketed for clinical use—and are otherwise designed, manufactured, and used within a single CLIA-certified high-complexity laboratory.
- Human Leukocyte Antigen (HLA) Tests: LDTs designed, manufactured, and used within a single CLIA-certified high-complexity histocompatibility testing laboratory when used in connection with certain organ, stem cell, and tissue transplantation activities.
- Forensic Tests: Tests intended solely for forensic (law enforcement) purposes.
- Military Tests: LDTs manufactured and performed within the Department of Defense or the Veterans Health Administration.
All other clinical laboratories that offer any LDTs—even those that are exempt from later stage compliance (e.g., LDTs approved by the New York Clinical Laboratory Evaluation Program, which are exempt from premarket review requirements that take effect in Stage Four and Five)—must comply with the Stage One requirements that take effect on May 6, 2025. Additionally, if a laboratory manufactures both exempt and nonexempt tests, it will be exempt from complying with Stage One only with respect to its exempt tests.
How Do I Prepare for Stage One?
Any laboratory that offers an LDT that does not fall into one of the above exempt categories should prepare to be in compliance with the FDA’s MDR, correction and removal reporting, and QS complaint requirements by May 6, 2025. Fortunately, of all the requirements the FDA will eventually impose over the four-year phaseout, the Stage One requirements are the least burdensome. Nonetheless, there is still work that needs to be done in preparation.
Medical Device Reporting Requirements (21 C.F.R. Part 803)
At Stage One, the FDA wants to be able to systematically monitor significant adverse events to identify “problematic” LDTs in the market. To help accomplish this goal, the FDA is requiring compliance with MDR requirements obligating a manufacturer, such as a laboratory, to report to the FDA reportable events of which it becomes aware.
A reportable event is an event that reasonably suggests an LDT has or may have caused or contributed to a death or serious injury, or has malfunctioned such that the LDT or a similar device marketed by the laboratory would be likely to cause or contribute to a death or serious injury if the malfunction were to recur. Importantly, a laboratory is required to report an event even if the laboratory is only able to determine the LDT may have caused or contributed to a death or serious injury. For example, user errors, issues with materials or components, design issues, labeling issues, issues resulting from off-label use, or other malfunctions may be reportable events—even if the error or issue only may have caused or contributed to the death or serious injury. Notably, reporting an event to the FDA does not constitute an admission that the LDT caused or contributed to the harm.
If a laboratory becomes aware of a reportable event, it must submit a report no later than thirty calendar days after the date the laboratory becomes aware of the event. Additionally, if the event requires remedial action to prevent unreasonable risk or substantial harm to the public health (or the FDA requests a report in writing), the laboratory must submit its report within five working days after it becomes aware of the event. The laboratory must also submit supplemental reports if it obtains more information after submitting the initial report. These reports must be submitted to the FDA through the Electronic Submissions Gateway (ESG) on Form 3500A.
To comply with these requirements, laboratories will need to establish procedures to timely and effectively identify and evaluate adverse events; establish a standardized review process for determining when reporting is required and how long the laboratory has to report the event; timely submit reports and supplemental reports to the FDA; and maintain documentation of all related information, reports, and evaluation materials. The purpose of these procedures is to allow a laboratory to comprehensively track all adverse events that may result from use of its LDTs and to provide the FDA with sufficient information necessary to inspect the laboratory’s activities with respect to an adverse event.
Correction and Removal Requirements (21 C.F.R. Part 806)
Furthering its goal to systematically monitor and identify “problematic” LDTs, the FDA is also requiring laboratories offering nonexempt LDTs to comply with its correction and removal requirements effective May 6, 2025. These requirements obligate laboratories to promptly report actions concerning some LDT corrections and removals and to maintain records of all corrections and removals even when not otherwise reportable.
A laboratory will be required to submit a written report to the FDA of any correction or removal of an LDT if the correction or removal is done (1) to reduce a risk to health posed by the LDT or (2) to remedy any unlawful activity resulting from the LDT’s use—for example, any unlawful labeling on the LDT. The FDA defines correction as the repair, modification, adjustment, relabeling, destruction, or inspection (including patient monitoring) of a device without its physical removal from its point of use to some other location. Removal means the physical removal of a device from its point of use to some other location for repair, modification, adjustment, relabeling, destruction, or inspection.
Not every correction or removal of a device is a reportable event. For example, actions taken by a laboratory to improve performance or quality of an LDT or profitability-based decisions to remove an LDT should not trigger reporting as long as those actions do not relate to reducing a risk to health or remedying any unlawful activity. Additionally, if the laboratory has already reported the event under the MDR requirements, no additional report is required. If, however, a laboratory corrects or removes an LDT in order to reduce a risk to health posed by the device or for a reason related to the LDT’s legal compliance, it must submit a report to the FDA within ten working days of initiating any correction or removal. This report can be emailed to the agency or submitted via the agency’s electronic submission software (eSubmitter) through the ESG.
To comply with these requirements, laboratories will need to maintain records of all reported and unreported corrections and removals. These reports should include all of the information the FDA otherwise requests if reporting is required, a narrative description of the events, any justification for not reporting if no report was made, and copies of all communication related to the LDT’s correction or removal. The FDA is authorized to access, copy, and verify all of these records and reports; thus, accuracy and completeness in recordkeeping is essential.
Quality System Complaint Files (21 C.F.R. § 820.198)
The final requirement of Stage One is compliance with the FDA’s QS complaint file requirements. This requirement obligates a laboratory offering nonexempt LDTs to establish a formally designated compliance unit and maintain procedures for receiving, reviewing, and evaluating all complaints.
This formally designated unit, staffed by one or more appropriately trained individuals, must establish written procedures to ensure that all complaints are processed in a uniform and timely manner, that oral complaints are documented upon receipt, and that complaints are evaluated to determine if additional adverse event reporting is required. The FDA suggests keeping all complaint files related to an LDT in a common file to allow for trend analyses. Although a formally designated complaint unit may be located at a site separate from the laboratory, information related to a complaint and its investigation must be reasonably accessible to the laboratory.
A laboratory’s complaint handling system is expected not only to allow it to identify trends that may need additional study or action but also to allow the FDA to assess its complaint processes during inspections. Again, clearly established processes and adequate documentation are key. Should a complaint be determined to not require investigation or subsequent reporting, a laboratory should include a narrative description in the complaint file explaining why an investigation was not required and identifying a specific individual responsible for that decision. Alternatively, should an investigation be required, the laboratory must maintain a record that includes specific information related to the complaint, including the LDT at issue; any unique device identifier or universal product code; the date; contact information for the complainant; the nature of the complaint and details around the complaint and investigation; whatever corrective action was required; and a reply to the complainant.
What’s Next?
Because of ongoing litigation and potential congressional action, it is unclear whether the FDA’s final rule on LDTs will come to fruition. The VALID Act, which would establish within the FDA a separate regulatory pathway for LDTs, currently sits stuck in committee with little chance to make further headway than it has in the last several years. Further, at least two complaints have been filed in federal court challenging the FDA’s authority to regulate LDTs on constitutional and procedural grounds. The lawsuit filed by the ACLA and HealthTrackRX was filed on May 29, 2024, and plaintiffs recently moved for summary judgement, arguing largely that an LDT is not a device under the Food, Drug, and Cosmetic Act and thus the final rule should be vacated. The Association for Molecular Pathology filed its complaint on August 19, 2024, alleging among other arguments that the major questions doctrine requires Congress to have clearly granted the FDA authority to regulate LDTs. Both cases contest the scope of the agency’s regulatory authority under the Food, Drug, and Cosmetic Act, and are poised to allow the consequences of Loper Bright Enterprises v. Raimondo, 144 S. Ct. 2244 (2024), to play out at the district level.
At the end of the day, unless and until the agency further amends its phaseout plan, Congress passes an alternative law, or a federal court speaks on the issue, the law remains what it is. It is unclear whether a ruling in either of the above cases will come before laboratories need to start taking meaningful steps toward complying with Stage One. As a result, it is prudent for laboratories to watch closely as these lawsuits unfold and evaluate how much time they need to ensure that they are well positioned to comply with the FDA’s MDR, correction and removal, and QS complaint file requirements by May 6, 2025.
