Navigating the FDA’s Final Rule for Laboratory-Developed Tests (LDTs)

Laboratory-developed tests (LDTs) have been an integral part of diagnostic medicine, providing laboratories with the flexibility to create tests tailored to specific clinical needs. However, over the past decades, the rapid evolution of LDTs, particularly the reliance on high-tech instruments and their increasing use in large patient populations, has prompted the U.S. Food and Drug Administration (FDA) to enhance its regulatory oversight.

The May 6, 2024, FDA ruling represents a landmark change in the regulation of LDTs. Previously under enforcement discretion, LDTs are now subject to a comprehensive regulatory framework aimed at ensuring their safety, efficacy, and reliability. This blog post provides an in-depth analysis of the FDA’s final rule, outlines the history and context of LDT regulation, and highlights the phases of implementation, challenges, and opportunities for laboratories and manufacturers.

History of FDA Oversight on LDTs

LDTs emerged as tools used by specialized laboratories to meet the specific diagnostic needs of local patient populations. Initially, they were small-scale tests performed manually by pathologists and technical experts, utilizing components already marketed for clinical use. This traditional landscape of LDTs was shaped by the 1976 Medical Device Amendments (MDA) to the Federal Food, Drug, and Cosmetic (FD&C) Act, which created a framework for the regulation of medical devices but exempted LDTs from several regulatory requirements.

As LDTs evolved, they began to rely on increasingly complex instruments and software and were utilized for high-volume testing that served national patient populations. The lack of a consistent regulatory framework for LDTs raised concerns about cybersecurity, device malfunctions, and the absence of medical device reporting and corrective mechanisms.

The Present-Day Landscape of LDTs

Today, LDTs are often indistinguishable from in vitro diagnostic (IVD) products in terms of the complexity of their design and their impact on patient care. As defined in 21 CFR 809.3(a), IVD products include instruments, systems, and reagents intended for the diagnosis of diseases or other conditions. These products play a vital role in informing treatment decisions for patients and are subject to rigorous regulatory scrutiny. LDTs, traditionally exempt from such oversight, now face a regulatory transition that will bring them in line with IVD requirements.

FDA’s Final Rule on LDTs (May 2024)

The FDA’s final rule on LDTs, effective May 6, 2024, marks a significant departure from the agency’s historical policy of enforcement discretion. This rule introduces a comprehensive regulatory framework for LDTs that includes premarket review requirements, Quality System Regulation (QSR) compliance, and postmarket surveillance. The FDA has also introduced a phased transition plan, known as the phaseout policy, to allow laboratories time to comply with the new requirements.

Key Components of the Final Rule

1. Expanded Regulatory Oversight: The FDA’s final rule subjects LDTs to the same regulatory requirements as IVD products. This expanded oversight aims to ensure LDTs meet the same standards for safety, efficacy, and reliability as IVDs. LDT developers must now adhere to stringent quality and regulatory standards, which include premarket review and postmarket surveillance.
2. Premarket Review Requirements: LDTs will now require premarket approval (PMA) or 510(k) clearance, depending on their risk classification. The FDA has established three risk categories for LDTs: high-risk, moderate-risk, and low-risk. High-risk LDTs, such as those used in critical treatment decisions, will be subject to the most stringent regulatory oversight, including PMA. Moderate- and low-risk LDTs will generally require 510(k) clearance, which is based on demonstrating that the LDT is substantially equivalent to a legally marketed device.
3. Quality System Regulation (QSR) Compliance: LDT developers must now comply with the FDA’s QSR, which is designed to confirm devices are manufactured in a consistent and controlled manner. It is important to know that the current QSR, largely based on 21 CFR Part 820, has been updated to the new Quality Management System Regulation (QMSR) which is scheduled to go into effect February 2, 2026. The new QMSR standards are intended to fully harmonize with ISO 13485:2016, the international standard for medical device quality management systems. This alignment with ISO 13485:2016 will facilitate global compliance for LDT developers.
4. Postmarket Surveillance: LDT developers are required to implement postmarket surveillance systems to monitor the performance of their tests after they have been marketed. This includes adverse event reporting, corrective actions/preventive actions (CAPA), and other postmarket monitoring activities to ensure the ongoing safety and effectiveness of LDTs.
5. Exemptions and Enforcement Discretion: The FDA has provided exemptions for LDTs intended for rare diseases or public health emergencies. These exemptions are subject to specific criteria and are intended to balance the need for innovation with the need for safety.
6. Transitional Period (Phaseout Policy): The FDA’s phaseout policy is designed to allow LDT developers time to comply with the new regulatory requirements. The transition will occur in phases, with different compliance deadlines based on the risk classification of the LDT. High-risk LDTs will face the earliest deadlines, while moderate- and low-risk LDTs will have additional time to comply.

Phases of Implementation: A Gradual Transition

The FDA has established a phased implementation plan for the final rule, which is designed to minimize disruptions to the availability of critical diagnostic tests while ensuring that laboratories have adequate time to adjust to the new regulatory requirements. The phaseout policy consists of five stages, each with its own set of compliance deadlines and requirements.

Phase 1 (May 6, 2025):

LDT developers will be required to comply with medical device reporting (MDR), complaint handling, and correction and removal reporting requirements. These requirements are outlined in 21 CFR Part 803 (Medical Device Reporting), 820.198 (Complaint Handling), and 806 (Corrections and Removals). LDT developers must establish formal systems for documenting and investigating device-related issues, including malfunctions, serious injuries, and deaths.

Phase 2 (May 6, 2026):

This phase introduces compliance with establishment registration, device listing, and labeling requirements under 21 CFR Parts 607, 807, 801, 809, 812, and 820. Laboratories will be required to register their establishments with the FDA and provide detailed labeling for their LDTs, including product name, intended use, warnings, and unique device identifiers (UDI).

Phase 3 (May 6, 2027):

The FDA will require compliance with all remaining QMSR requirements, including design controls, acceptance activities, and record-keeping. High-risk LDTs that do not meet these requirements may not be permitted to remain on the market.

Phase 4 (November 6, 2027):

LDTs classified as high-risk devices must comply with investigational device exemption (IDE) requirements and obtain PMA or 510(k) clearance. High-risk LDTs that do not meet these requirements may not be permitted to remain on the market.

Phase 5 (May 6, 2028):

LDTs classified as low and moderate-risk devices must be submitted for premarket review, however, most low-risk IVDs are expected to be exempt from premarket review.

Harmonization With ISO 13485:2016

One of the most significant aspects of the FDA’s final rule is the alignment of the QSR with ISO 13485:2016. ISO 13485:2016 is an international standard that outlines the quality management system (QMS) requirements for medical devices and now IVDs. As mentioned above, the current QSR will convert to the QMSR as of February 2, 2026, which is intended to fully align with the ISO 13485:2016 standards. ISO 13485:2016 emphasizes a risk-based approach to quality management, which involves identifying, assessing, and mitigating risks throughout the product lifecycle.

Key Changes to 21 CFR Part 820

1. Risk Management: The new QMSR places a greater emphasis on risk management throughout the design, development, manufacturing, and postmarket phases. LDT developers are required to implement robust risk management systems to ensure potential hazards are identified and addressed proactively.
2. Documentation and Record-Keeping: LDT developers must maintain comprehensive documentation for design controls, quality assurance, and corrective actions. This documentation certifies all processes are traceable and regulatory compliance can be verified during FDA inspections.
3. Supplier Controls: The new rule strengthens the requirements for supplier qualification and monitoring. LDT developers must certify all components and materials used in their tests meet regulatory standards for safety and effectiveness. Supplier audits and quality agreements are essential components of this process.
4. Management Responsibility: The FDA’s final rule emphasizes the role of top management in establishing and maintaining a QMS. Management must be actively involved in setting quality objectives, conducting management reviews, and ensuring that the QMS is effective.
5. Training and Competence: The new regulations place a strong emphasis on training and competence. LDT developers must guarantee personnel involved in the development, manufacturing, and testing of LDTs are adequately trained and understand their roles within the QMS.

The Role of Quality Management in Compliance

Compliance with the FDA’s new regulations will require LDT developers to implement robust quality management systems that align with both the FDA’s QSR/QMSR and ISO 13485:2016. A strong QMS is essential for meeting regulatory requirements, reducing risks, and ensuring the consistent quality of LDTs.

Avendium, a leader in quality management and regulatory affairs consulting, provides comprehensive support for laboratories, medical device manufacturers, and biopharmaceutical companies navigating these regulatory changes. Avendium’s core capabilities include:

• Quality Management System Support: Avendium assists clients in developing and maintaining QMS that meet FDA and ISO 13485 requirements. This includes gap assessments, document management, internal/external auditing, and CAPA management.
• Vendor Qualification: Ensuring that suppliers meet regulatory standards is critical for compliance. Avendium helps clients develop supplier questionnaires, conduct audits, and manage supplier quality agreements.
• Risk Management: Avendium provides tools and guidance for developing risk management plans and standard operating procedures (SOPs) to mitigate risks throughout the product lifecycle.
• Training and Auditing: Avendium offers training in good clinical practices (GCP), good manufacturing practices (GMP), and CAPA management to confirm personnel are prepared for FDA inspections and laboratories are in compliance with regulatory requirements.

Challenges and Opportunities

The FDA’s final rule on LDTs presents both challenges and opportunities for laboratories and manufacturers. While the transition to full regulatory oversight may be burdensome for some laboratories, the new regulations also provide opportunities for innovation, differentiation, and global market expansion.

Challenges

• Regulatory Burden: The transition from enforcement discretion to full regulatory oversight will require significant investment in quality management systems, documentation, and training. Most laboratories will need to update their existing processes to meet the new requirements.
• Compliance Costs: Laboratories will face additional costs related to registration, premarket submissions, and compliance with quality system requirements. Small laboratories may find these costs particularly challenging to manage.

Opportunities

• Innovation and Differentiation: Compliance with the FDA’s regulations will enhance the credibility of LDTs and provide opportunities for differentiation in a competitive market. Laboratories that invest in quality and compliance will be well-positioned to offer reliable, high-quality tests that meet the FDA’s stringent standards, and which are better positioned for payor reimbursement.
• Global Alignment: The harmonization of U.S. regulations with ISO 13485:2016 will simplify compliance for laboratories operating in international markets. Laboratories that meet ISO 13485 requirements will be better equipped to compete in the global diagnostics market.

Conclusion

The FDA’s final rule on LDTs marks a significant shift in the regulation of laboratory-developed tests, bringing them in line with IVDs and other regulated medical devices. By adopting a phased transition approach, the FDA aims to ensure patient safety without disrupting access to essential diagnostic tests. Laboratories and manufacturers must act now to implement robust quality management systems that align with FDA regulations and ISO standards. With the right strategic planning and support, LDT developers can navigate this regulatory landscape and emerge stronger, more innovative, and more competitive in the global diagnostics market.

References

1. Medical Devices; Laboratory Developed Tests: https://www.federalregister.gov/documents/2024/05/06/2024-08935/medical-devices-laboratory-developed-tests
2. Laboratory Developed Tests: Small Entity Compliance Guide Guidance for Laboratory Manufacturers and Food and Drug Administration Staff: https://www.fda.gov/media/179543/download
3. Medical Devices; Quality System Regulation Amendments: https://www.federalregister.gov/documents/2024/02/02/2024-01709/medical-devices-quality-system-regulation-amendments