Diagnostic tests are tremendously important in healthcare. Doctors rely on them to detect conditions and decide the best treatment for their patients – so they need to be accurate. 

Most diagnostic tests are therefore regulated by the US Food and Drug Administration (FDA) as medical devices. Manufacturers must submit substantial evidence to the regulator before the product can be brought to market. But there’s one type of clinical test that is exempt from this requirement. Laboratory-based tests (LDTs) are in-vitro diagnostic tools that are designed, manufactured and performed in a single laboratory. 

They’re sometimes called ‘in-house tests’ and often contain the same components as in-vitro diagnostics that are regulated by the FDA. The distinction is that they must be developed and used within the same facility. 

“As a key source of diagnostic quality and innovation, LDTs play a critical role in our healthcare system, especially during a pandemic,” said a spokesperson from the American Clinical Laboratory Association (ACLA ), a trade association for diagnostic laboratory workers. 

“These tests are often developed to address unmet clinical needs and are critical tools in the fight against cancer, rare diseases, and emerging outbreaks. Indeed, in the case of Covid-19, many of the first widely available tests in the United States were LDTs developed by ACLA members.”

Exemption and confusion

In the US, LDTs don’t usually undergo premarket review or receive FDA clearance for marketing. The rationale for the less stringent requirements is the regulator considers that LDTs generally pose a lower risk to patients than commercially available tests. 

Instead, labs that make LDTs must be certified under the Clinical Laboratories Improvement Amendments (CLIA ) – a body that sets standards for lab staff, equipment and protocols. A CLIA review rarely includes clinical validity. 

But in recent years, voices from all sides of the political spectrum have called for LDT regulation reform, suggesting the current system is no longer fit for purpose. LDTs have changed a lot in the last few decades thanks to exciting scientific advances such as the Human Genome Project. 

In the past, LDTs were employed mainly to diagnose rare diseases where lack of demand meant there were few commercially available options for patients. These days, LDTs exist for a wide range of conditions, including infectious diseases and cancer. 

Some LDTs are now marketed throughout the US without clinical validation which has led to concerns about accuracy, reliability, and ultimately patient safety. There is also no official process for reporting adverse events from LDTs to the regulator.

At times, this regulatory quirk has had grave consequences. When LABCORP ’s OvaSure launched in 2008, it was marketed as a LDT that could detect ovarian cancer at an early stage in women with a family history of the disease. Shortly afterwards, medical research groups grew concerned about the test’s accuracy. 

Sure enough, when the test was independently evaluated, researchers found OvaSure was less predictive of cancer than it claimed to be and had a high false-positive rate. The error had potentially led women to undergo unnecessary and invasive surgery to remove the ovaries. The test was pulled from the market, but the scale of the damage is unknown. As it was marketed as an LDT, adverse events were not reported to the FDA. 

Pandemic response

Perhaps unsurprisingly, the LDT regulatory debate became fiercer during the pandemic. There is more awareness than ever of the critical role laboratory diagnostics play in a healthcare system. But swiftly changing rules created confusion for clinical scientists at an intensely stressful time, says ACLA. 

At the start of the crisis, the FDA required all Covid-19 tests (including LDTs) to receive an emergency use authorisation (EUA) from the agency. This was later revised, allowing labs to bring a test to market immediately provided they applied for an EUA within 15 days. But critics say the damage was already done. 

The early enforcement decisions discouraged clinical laboratories from developing their own Covid-19 tests, which might have exacerbated the spread of the virus in the country. 

In summer 2020, the message changed again. The Trump administration’s Department of Health and Human Services (HHS) announced that FDA would allow LDTs, including Covid-19 tests, to be distributed without first undergoing a premarket review.  

Former FDA commissioner Scott Gottlieb criticised the policy shift. “Now, FDA’s ability to protect public health could be challenged,” he wrote on Twitter. “FDA might not be able to provide critical advice to test developers or take needed enforcement actions against bad tests. After all, how can FDA take action over something HHS says it doesn’t regulate?” 

Uncertainty abounds for clinical laboratories offering LDTs regarding if and how the FDA will regulate in-house tests in future. What is needed, says ACLA, is a system that ensures appropriate regulatory oversight without hampering innovation. The group has written to the Biden administration, urging it to consider the expertise of the laboratory community when deciding new rules for LDTs. 

Appropriate standards

A significant stumbling block in drawing up appropriate rules thus far has been a failure to acknowledge the key differences between medical devices and diagnostic tests, the group suggests. “In order for diagnostic reform to be successful, the new framework must apply the most appropriate standards for diagnostics, as opposed to a standard designed for medical products other than diagnostics,” said the ACLA spokesperson. 

ACLA is reviewing the Verifying Accurate, Leading-edge In-vitro clinical test Development (VALID) Act first introduced in House and Senate in March 2020 by Senator Rand Paul. It was reintroduced in May 2021. The legislation creates a new test product category – in vitro clinical tests – and would give the FDA authority to review and approve them. 

“When we face a health emergency, government should trust academic, community, and public health labs to do what they are already trained and certified to do,” said Paul in a statement regarding the bill’s reintroduction. 

“With all of the debates about how government should respond, here’s one thing it can stop doing: piling counter-productive bureaucratic hurdles in the way of our medical professionals.” 

Julie Khani, ACLA president, said the pandemic had illustrated a need for “nimble” regulatory pathways. “To best service patients, laboratories need clarity and certainty in the regulatory environment,” she said in a statement issued after VALID’s reintroduction. 

“This certainty is critical to encourage innovation, and the next generation of breakthrough technologies, and to support continued patient access to accurate and reliable LDTs necessary to diagnose, monitor and optimise the treatment of disease.”