WEBVTT - Biden’s Lab-Developed Test Proposal 0:00:12.800 --> 0:00:16.080 Hello, and welcome to the Votes and Verdicks Podcasts, hosted 0:00:16.079 --> 0:00:19.520 by the policy and Litigation team at Bloomberg Intelligence, the 0:00:19.560 --> 0:00:24.720 investment research platform of Bloomberg LP. This podcast series examines 0:00:24.760 --> 0:00:29.200 the intersection of business policy and law. I'm Duane Wright, 0:00:29.280 --> 0:00:34.320 an analyst with Bloomberg Intelligence covering government healthcare policy. On 0:00:34.360 --> 0:00:38.199 today's episode, we'll be talking to Susan van Meter, president 0:00:38.280 --> 0:00:42.680 of the American Clinical Laboratory Association, which represents the nation's 0:00:42.680 --> 0:00:48.520 clinical laboratories. Susan has a deep healthcare policy and advocacy background, 0:00:48.520 --> 0:00:52.560 which includes over seventeen years leading the federal relations wing 0:00:52.680 --> 0:00:56.880 of the Healthcare Association of New York State, which represents 0:00:56.920 --> 0:01:01.080 New York's hospital and health system, and most recently was 0:01:01.120 --> 0:01:05.720 the executive director of adam DX, where she directed policy 0:01:05.760 --> 0:01:10.000 and advocacy for manufacturers of in vitro diagnostic clinical tests. 0:01:11.440 --> 0:01:14.319 I'm looking forward to our conversation today because there's a 0:01:14.319 --> 0:01:17.360 lot going on in the clinical lab space, whether it's 0:01:17.440 --> 0:01:21.960 FDA regulatory policy or CMS payment policy. We'll dive into 0:01:22.000 --> 0:01:25.120 those topics today, So Susan, Welcome to the Votes in 0:01:25.200 --> 0:01:26.200 Verdicts podcast. 0:01:27.080 --> 0:01:29.280 Hey, Dwayne, thanks for having me join you today. I've 0:01:29.319 --> 0:01:30.679 been looking forward to this conversation. 0:01:32.160 --> 0:01:37.360 So, Susan, you became president of ACLA April twenty twenty two. 0:01:39.160 --> 0:01:41.959 What is ACLA, who do you represent and how many 0:01:42.000 --> 0:01:43.680 members are in your association? 0:01:44.800 --> 0:01:48.960 Well, the ACLA we represent the lation nation's leading national 0:01:49.040 --> 0:01:53.280 clinical laboratories, so we have about forty laboratories and the 0:01:53.320 --> 0:01:57.360 membership as a whole, they include both the nation's largest 0:01:57.640 --> 0:02:04.280 clinical commercial laboratories, so lab Corp, Quest, Mayo, Clinic Bioreference, Sonic, 0:02:04.360 --> 0:02:08.720 among others. And then we have a number of laboratories 0:02:08.760 --> 0:02:13.000 that have more focused menus that are really driving precision medicine, 0:02:13.400 --> 0:02:18.880 focusing on advanced diagnostics. They include companies such as Tempests, 0:02:19.000 --> 0:02:23.959 Exact Sciences, Neogenomics, Myriad, and many others, and all together 0:02:24.000 --> 0:02:26.920 again about forty members. We also have a category of 0:02:26.960 --> 0:02:32.639 associate membership that principally includes IVD manufacturers, so companies such 0:02:32.680 --> 0:02:37.839 as Abbott, BDH, Logic, Roche, Siemen's, ThermoFisher and others. Really 0:02:37.880 --> 0:02:41.639 gives us a nice expansive view of the whole diagnostics ecosystem. 0:02:42.000 --> 0:02:46.000 But principally we're focused on advocating for policy to really 0:02:46.120 --> 0:02:51.440 expand patient access to innovative diagnostics for clinical laboratories. 0:02:52.760 --> 0:02:56.959 So, as I mentioned earlier, you became president April twenty 0:02:56.960 --> 0:03:02.160 twenty two. It's now January twenty twenty four. Time lies, 0:03:02.440 --> 0:03:05.600 what were the key priorities when we took over the 0:03:05.720 --> 0:03:09.040 job and how has the landscape changed since then. 0:03:09.880 --> 0:03:14.120 Yeah, Well, when I first started, we were really in 0:03:14.480 --> 0:03:18.440 the heat of discussions on two key issue areas. One 0:03:18.560 --> 0:03:21.040 is PAMA reform, and I know we'll talk more about 0:03:21.040 --> 0:03:26.680 that later, but also oversight of diagnostics. And at that 0:03:26.840 --> 0:03:30.720 time Senator Burr and Senator Murray were really driving a 0:03:30.840 --> 0:03:33.960 very active discussion on the Hill on the Valid Act, 0:03:34.040 --> 0:03:36.760 which was a piece of legislation that it would have 0:03:37.000 --> 0:03:43.320 established a diagnostic specific regulatory apparatus separate and apart from 0:03:43.360 --> 0:03:47.480 medical device and that this would have been one kind 0:03:47.480 --> 0:03:53.360 of cohesive regulatory framework. So we were heavily involved in 0:03:53.360 --> 0:03:56.080 that when I started. As we know, the Valid Act 0:03:56.120 --> 0:04:00.360 did not cross the finish line, but this issue persists. Sure, 0:04:00.360 --> 0:04:03.120 we'll talk a little bit more about what's happened post 0:04:03.160 --> 0:04:06.920 Valid Act. But the way to think about ACLA priorities 0:04:07.080 --> 0:04:09.800 is that we have four key pillars of our work. 0:04:10.560 --> 0:04:14.440 The first pillar is reimbursement, so we focus on ensuring 0:04:14.520 --> 0:04:17.640 that we are representing the industry well when it comes 0:04:17.680 --> 0:04:21.680 to securing new codes and appropriate crosswalks or gap fills 0:04:21.720 --> 0:04:26.400 for payments for new tests and technologies, and of course 0:04:26.440 --> 0:04:30.560 we'll talk about PAMMA and PAMA reform. Under reimbursement, we 0:04:30.640 --> 0:04:33.360 also spend quite a lot of time engaging with MAX 0:04:34.040 --> 0:04:38.520 on local coverage determinations and then of course private payers 0:04:38.520 --> 0:04:42.600 on coverage and payment policy. Second main pillar of our 0:04:42.640 --> 0:04:46.160 work is regulatory, so that's both with regard to KLEA 0:04:46.200 --> 0:04:48.599 and as we know, the KLIAK has put forward several 0:04:48.640 --> 0:04:52.600 dozen recommendations over the last year that CMS and HHS 0:04:52.640 --> 0:04:55.760 more broadly might consider, so we've been heavily involved there. 0:04:56.000 --> 0:04:59.560 Also under the regulatory umbrella we have our engagement with 0:04:59.640 --> 0:05:04.000 the f A third category or pillar of our work 0:05:04.080 --> 0:05:07.240 is preparedness and infrastructure. So when I came on board, 0:05:07.760 --> 0:05:11.680 COVID was winding down, but then we had another public 0:05:11.680 --> 0:05:15.680 health emergency that was EMPOCS, and our laboratory stepped up 0:05:15.720 --> 0:05:18.839 to partner and support the public health labs in the 0:05:18.839 --> 0:05:23.760 country to dramatically augment capacity for IMPOS testing. We're very 0:05:23.800 --> 0:05:26.279 proud of that work. So our work on preparedness and 0:05:26.320 --> 0:05:29.839 infrastructure continues. We do have a set of recommendations that 0:05:29.880 --> 0:05:33.320 we actually develop with the Johns Hopkins Center for Health Security. 0:05:33.320 --> 0:05:36.160 We're very proud of. It's a proposal for a national 0:05:36.200 --> 0:05:38.920 Diagnostics Action Plan, So we're continuing to work on that. 0:05:39.520 --> 0:05:42.560 And the last pillar of our work is in public affairs, 0:05:43.000 --> 0:05:45.640 and I'll just draw attention to a campaign that we 0:05:45.720 --> 0:05:49.040 started last year called the Power of Knowing, and that's 0:05:49.080 --> 0:05:54.160 all about ensuring that policymakers understand the foundational role that 0:05:54.320 --> 0:05:58.200 diagnostics play in inform clinical decision making. You know, we 0:05:58.240 --> 0:06:02.919 really like to underscore for US disease awareness months or 0:06:03.040 --> 0:06:07.400 days how important that clinical laboratory testing really is to 0:06:07.440 --> 0:06:12.520 making sure that parent patients are diagnosed appropriately and set 0:06:12.560 --> 0:06:16.000 on the right course for treatment and monitoring of treatment 0:06:16.160 --> 0:06:17.520 to ensure the best outcomes. 0:06:19.000 --> 0:06:21.920 Susan, thanks for that background. It seems like you all 0:06:21.960 --> 0:06:24.960 have a lot on your plate, and I think it's 0:06:25.000 --> 0:06:29.640 fair to say that the FDA added some more work 0:06:29.720 --> 0:06:32.600 for you all, And I want to touch on this 0:06:32.880 --> 0:06:38.000 issue of FDA oversight of laboratory developed tests, and I 0:06:38.000 --> 0:06:43.600 think it's worth trying to highlight how LDTs fit into 0:06:43.640 --> 0:06:45.760 the healthcare system. Now, So can you just give us 0:06:46.040 --> 0:06:51.039 an overview of what we're talking about when we say 0:06:51.400 --> 0:06:57.360 LDTs and how acla's advocacy on the issue of FDA 0:06:57.440 --> 0:07:00.240 oversights has changed over time. 0:07:00.760 --> 0:07:07.080 Yeah. Well, LDTs, or laboratory developed tests, are an integral 0:07:07.200 --> 0:07:13.680 and tremendously important aspect of the healthcare delivery system. These 0:07:13.680 --> 0:07:17.840 are tests that are developed to meet clinical needs. We 0:07:18.040 --> 0:07:23.360 have members of ours that have for example, developed tests 0:07:23.400 --> 0:07:28.760 to address conditions that were either previously unknown or not 0:07:28.880 --> 0:07:33.880 well understood. So there's a category of tests that really 0:07:33.920 --> 0:07:39.239 address rare diseases and that's tremendously important. So it could 0:07:39.280 --> 0:07:42.720 be perhaps a small patient population, but these tests are 0:07:42.880 --> 0:07:47.520 essential in ensuring that we're identifying disease and again helping 0:07:47.600 --> 0:07:51.720 to drive clinical decision making. LDTs are also part of 0:07:51.760 --> 0:07:55.239 you know, routine tests, so when you take a regular 0:07:55.280 --> 0:07:59.600 annual physical, you'll have a number of core tests that 0:07:59.640 --> 0:08:02.760 will help your clinician just really ascertain how your overall 0:08:02.840 --> 0:08:06.680 health is. And then of course LDTs are and I think, uh, 0:08:06.760 --> 0:08:09.120 you know critically here for this discussion we're going to 0:08:09.160 --> 0:08:11.560 have about the role of the f d A LDTs 0:08:11.600 --> 0:08:15.600 are really a way where we see innovation being driven 0:08:15.680 --> 0:08:22.280 in diagnostics broadly, LDTs have the capacity to respond quickly, 0:08:22.320 --> 0:08:25.520 whether it's to a public health emergency or to ensure 0:08:25.720 --> 0:08:31.520 that the latest scientific understanding of a disease, of characteristics 0:08:31.520 --> 0:08:33.520 of a disease. I'm sure we'll talk a little bit 0:08:33.520 --> 0:08:37.520 about biomarkers, but how do we translate the latest scientific 0:08:37.600 --> 0:08:43.520 discoveries into diagnostics to really help drive patient care. So 0:08:43.800 --> 0:08:49.000 when I think about how foundational laboratory developed tests are 0:08:49.120 --> 0:08:53.599 to driving precision medicine, you know that's going to be 0:08:53.640 --> 0:08:57.839 a significant area of focus for all of us moving forward. Right. 0:08:58.320 --> 0:09:01.920 LDTs are really rather replaceable again when it comes to 0:09:02.080 --> 0:09:06.280 really reflecting the latest science in a diagnostic. 0:09:05.760 --> 0:09:09.800 And So in terms of how ACLA has approached this issue, 0:09:11.280 --> 0:09:15.200 what's changed Because in the past, ACLA had had been 0:09:15.400 --> 0:09:20.800 historically opposed to oversight by the FDA, and that seems 0:09:20.800 --> 0:09:24.640 to have shifted a bit. Can you walk us through 0:09:24.679 --> 0:09:26.920 that shift and what are your goals when you think 0:09:26.960 --> 0:09:28.559 about this process? 0:09:28.920 --> 0:09:32.079 Sure, of course, and that's a great question. And acla's 0:09:32.080 --> 0:09:35.240 position has changed, and some of that change does indeed 0:09:35.320 --> 0:09:39.920 pre date me. So there are a number of ACLA 0:09:40.000 --> 0:09:43.360 member companies that do bring some tests through the agency. 0:09:43.480 --> 0:09:47.000 So there's some experience within the ACLA membership of working 0:09:47.120 --> 0:09:50.719 with the FDA, and that's you know, beyond securing euas 0:09:50.840 --> 0:09:54.600 for public health emergencies, right, it's for core tests as 0:09:54.679 --> 0:09:57.559 part of some of our member companies menus. So there 0:09:57.640 --> 0:10:01.600 is that experience. But more broadly, the issue has been 0:10:01.920 --> 0:10:05.680 that for many, many years, the FDA has indicated that 0:10:05.760 --> 0:10:09.760 it has authority to regulate LDTs and is simply exercising 0:10:09.800 --> 0:10:16.079 its enforcement discretion, that is not actively providing oversight. What 0:10:16.160 --> 0:10:20.000 that does is creates gray area and uncertainty in the 0:10:20.040 --> 0:10:25.760 market for diagnostic test developers, for laboratories developing tests. So 0:10:26.679 --> 0:10:29.160 you know, when you have that gray area, you might 0:10:29.200 --> 0:10:32.240 see a reluctance from companies to jump into a space 0:10:32.320 --> 0:10:35.840 to develop some testing when it's essential for patients. So 0:10:35.880 --> 0:10:39.360 we started having a conversation with the agency a few 0:10:39.440 --> 0:10:43.120 years ago about how to address that gray area. Right, 0:10:43.520 --> 0:10:46.839 It's not to say there isn't robust oversight now. Right, 0:10:46.960 --> 0:10:49.600 Every ACLA member is a KLi lab, all of our 0:10:49.640 --> 0:10:53.400 members are accredited by the College of American Pathologists. There's 0:10:53.440 --> 0:10:56.000 a lot of other oversight that's in place to de 0:10:56.120 --> 0:10:59.240 facto many of our labs, if not most of our 0:10:59.320 --> 0:11:01.760 labs are caring for patients that are in New York, 0:11:01.840 --> 0:11:06.360 so they're subject to New York States requirements in addition 0:11:06.559 --> 0:11:10.000 to requirements that need to be made for coverage, for example, 0:11:10.000 --> 0:11:13.120 by the moldex program. So there is a significant amount 0:11:13.200 --> 0:11:16.880 of oversight that should reassure folks about the performance of tests. 0:11:17.240 --> 0:11:19.840 But because of that gray area, we thought it was 0:11:19.880 --> 0:11:24.920 really important to significantly engage on any efforts for diagnostics reform, 0:11:25.280 --> 0:11:27.880 and look, the FDA has been focused for a lot 0:11:27.920 --> 0:11:31.360 of years and thinking about how to move from an 0:11:31.440 --> 0:11:36.080 enforcement discretion position to having more active oversight. We wanted 0:11:36.080 --> 0:11:39.040 to be part of those conversations on legislation and think 0:11:39.080 --> 0:11:42.439 that's important because we do see a role for the 0:11:42.520 --> 0:11:48.120 FDA potentially, but only if it's done via legislation to 0:11:48.280 --> 0:11:54.440 craft a diagnostic specific overall framework. That's critically important. 0:11:54.720 --> 0:11:57.880 And that's good to know because I think we should 0:11:57.880 --> 0:11:59.880 talk a bit about the history here. You mentioned the 0:12:00.160 --> 0:12:07.640 FDA's thinking about enforcement discretion, and there is a history 0:12:07.640 --> 0:12:12.559 here where prior to twenty sixteen, the FDA did release 0:12:12.920 --> 0:12:17.680 guidance to implement some kind of oversight of laboratory developed 0:12:17.720 --> 0:12:22.199 tests that was when President Obama was president. There was 0:12:22.240 --> 0:12:26.520 a change in administration, that guidance ended up getting pulled back, 0:12:26.800 --> 0:12:30.839 and there was this effort, as you mentioned, to figure 0:12:30.840 --> 0:12:35.440 out another way forward. And now it's fast forward to 0:12:35.440 --> 0:12:38.880 twenty twenty three. September of twenty twenty three, the FDA 0:12:39.559 --> 0:12:45.120 released a proposed role to provide a framework or at 0:12:45.200 --> 0:12:48.679 least maybe there's a short wave putting it bring LDTs 0:12:48.760 --> 0:12:52.920 into the Medical Device Framework. And so that common period 0:12:53.120 --> 0:12:58.520 opened and closed October through December, and now we're waiting 0:12:58.559 --> 0:13:03.040 on some I guess my final role at some point, 0:13:03.160 --> 0:13:06.520 which many think is probably the first half of this year. 0:13:07.360 --> 0:13:12.520 So ACLA provided some comments, as did others, and there 0:13:12.520 --> 0:13:18.520 are plenty of comments from hospitals, labs, diagnostic manufacturers, patient groups, 0:13:18.520 --> 0:13:20.480 and we can get into that a little bit later, 0:13:20.840 --> 0:13:27.200 but focusing on what ACLA wrote in terms of the comments, Oh, 0:13:28.240 --> 0:13:32.320 what is it about the role of LDTs in guiding 0:13:32.520 --> 0:13:35.520 patient care that makes the Device framework, which is what 0:13:35.720 --> 0:13:40.480 FDA wants to bring LDTs under. What about that framework 0:13:40.640 --> 0:13:43.320 makes makes it a poor fit? And why this is 0:13:43.320 --> 0:13:45.080 the wrong direction for the FDA. 0:13:45.679 --> 0:13:49.160 Yeah, it's a great question, and I think it's exactly 0:13:49.280 --> 0:13:52.720 the right question. Right, Because the ACLA, as I had 0:13:52.760 --> 0:13:58.079 mentioned previously, we can see a role for the FDA, right. So, 0:13:58.920 --> 0:14:02.400 but it has to be a framework that is established 0:14:02.440 --> 0:14:06.280 by a legislation that is specific to diagnostics, because we 0:14:06.400 --> 0:14:09.840 do think if you take the medical device authorities and 0:14:09.920 --> 0:14:13.080 apply it to laboratory developed test you are going to 0:14:13.200 --> 0:14:17.560 lose a significant number of tests on test menus. You 0:14:17.640 --> 0:14:22.160 are going to lose the ability to swiftly take the 0:14:22.320 --> 0:14:26.120 latest advances in science and apply it to diagnostics to 0:14:26.200 --> 0:14:32.200 really drive personalized care. And the med device authorities are 0:14:32.280 --> 0:14:39.720 rather inflexible. So let's consider an example of precision oncology testing. Right, 0:14:39.760 --> 0:14:44.240 I'll genericize it somewhat, but we have several members that 0:14:44.400 --> 0:14:47.280 have taken tests through the agency, so they have cleared 0:14:47.360 --> 0:14:53.240 or approved assays in the cancer space. They also maintain 0:14:53.520 --> 0:14:57.640 an LDT. And the reason they maintain the LDT is 0:14:57.680 --> 0:15:03.120 because they're able to swiftly iterate upon that latest discovery. Right, 0:15:03.200 --> 0:15:06.440 they've discerned there's an impact that a new that understanding 0:15:06.440 --> 0:15:12.720 of a biomarker has on you know, improved diagnosis, improved 0:15:12.840 --> 0:15:17.040 decision making around treatment. You want to update that test 0:15:17.360 --> 0:15:21.360 so that you're delivering that latest scient ticket advancement to 0:15:21.480 --> 0:15:26.280 patients and providers. That's what patients deserve. Unfortunately, the medical 0:15:26.320 --> 0:15:30.360 device authorities don't allow for that kind of iteration on 0:15:30.480 --> 0:15:32.560 tests and that's really important. So you're going to be 0:15:32.920 --> 0:15:37.640 you're going to have this lack of innovation meeting patients 0:15:37.880 --> 0:15:42.760 and that's really essential. So that's a very very important issue, 0:15:42.840 --> 0:15:46.720 a policy issue, and this is about putting patients first 0:15:46.960 --> 0:15:50.040 and ensuring we're supporting innovation. Let me give you another 0:15:50.080 --> 0:15:53.400 example too, right. I had mentioned that LDTs are really 0:15:53.440 --> 0:16:00.000 important for uh, you know, ensuring that we are ascertained 0:16:00.480 --> 0:16:04.320 what disease condition might be afflicting a patient. And there 0:16:04.360 --> 0:16:09.680 are scores of rare diseases small patient populations and ldt's 0:16:09.760 --> 0:16:13.120 sort of a really important role here. If we contemplate 0:16:13.200 --> 0:16:17.520 sort of what's the economic decision making that goes into 0:16:17.720 --> 0:16:21.520 developing a test and taking it through the agency. You 0:16:21.560 --> 0:16:23.920 need to consider what's the cost of developing the tests, 0:16:23.960 --> 0:16:28.080 the clinical study is necessary to prepare a submission, and 0:16:28.120 --> 0:16:32.320 the cost of the submission itself if it's a five 0:16:32.400 --> 0:16:34.840 to ten K. But if we're talking about rare disease, 0:16:34.880 --> 0:16:36.720 you know, more likely that's going to be a PMA 0:16:36.840 --> 0:16:40.360 or DENOVO and the fee is somewhere over four hundred 0:16:40.360 --> 0:16:45.160 thousand dollars. That's not insignificant when you're talking about the 0:16:45.200 --> 0:16:49.280 potential to have revenue being rather modest, given these tests 0:16:49.320 --> 0:16:51.680 are going to be applied to a really small segment 0:16:51.840 --> 0:16:55.360 of the patient population. So we have a member company 0:16:55.440 --> 0:17:00.800 that has several hundred LDTs and they tell that for 0:17:01.160 --> 0:17:04.560 half of their ldt's, the annual revenue for each one 0:17:04.600 --> 0:17:07.399 of those tests is less than the cost of a 0:17:07.440 --> 0:17:09.840 five to ten k fee. So you can see if 0:17:09.880 --> 0:17:13.760 you apply the medical device authorities broadly, you're going to 0:17:13.880 --> 0:17:18.080 have labs face some really difficult questions about which tests 0:17:18.160 --> 0:17:20.840 they can afford to keep. On those menus, we want 0:17:20.840 --> 0:17:23.640 to be able to do the right thing and make 0:17:23.720 --> 0:17:27.159 sure that ldt's are able to meet the needs of 0:17:27.320 --> 0:17:31.240 small patient populations. They're critically important patients. We want to 0:17:31.240 --> 0:17:34.080 make sure that they've got the treatments available to them 0:17:34.119 --> 0:17:36.280 that they deserve, and you need to have a diagnostic 0:17:36.320 --> 0:17:38.359 to drive that. So those are a couple of key 0:17:38.440 --> 0:17:43.320 examples why the inflexibility of the medical device authorities are 0:17:43.359 --> 0:17:49.000 really dramatically unsuited or ill suited for diagnostics generally. 0:17:50.080 --> 0:17:56.400 That's great background and understanding that viewpoint, there's another aspect, 0:17:56.600 --> 0:18:00.560 which is, well, does FDA even have the authority to 0:18:00.800 --> 0:18:04.000 do this? As I mentioned earlier, they tried to do 0:18:04.040 --> 0:18:08.320 this through guidance in twenty sixteen. Now they're trying to 0:18:08.359 --> 0:18:12.840 do it through a proposed rule. Do they have authority 0:18:12.880 --> 0:18:16.320 to do this? And if the FD eight does end 0:18:16.400 --> 0:18:21.639 up finalizing this rule, are we likely to see litigation? 0:18:22.160 --> 0:18:23.879 You know, we've seen over the last year and a 0:18:23.880 --> 0:18:27.240 half with passage of the Inflation Reduction Act and the 0:18:27.320 --> 0:18:32.280 negotiation pieces, there's a lot of litigation from the companies 0:18:32.320 --> 0:18:38.240 that are impacted through the negotiation process. So are you 0:18:38.400 --> 0:18:41.679 likely to see that play out if the FDA finalizes 0:18:41.720 --> 0:18:42.080 the rule? 0:18:43.640 --> 0:18:48.520 Yeah, so easily. For many years has maintained a position 0:18:48.880 --> 0:18:53.199 that the agency lacks the authority under current law to 0:18:53.280 --> 0:18:57.400 apply the medical device authorities to LDTs. We've been very 0:18:57.440 --> 0:19:02.760 clear about that for many years. So how do we 0:19:02.800 --> 0:19:07.680 think about this? Well, LDTs are unique assays right designed, 0:19:07.720 --> 0:19:11.240 developed and performed by clinical laboratories certified under clear to 0:19:11.280 --> 0:19:15.600 perform high complexity testing to yield important clinical information about 0:19:15.600 --> 0:19:18.240 a patient that can be used again to inform or 0:19:18.359 --> 0:19:22.520 guide patient care. So laboratories that develop and perform LDTs 0:19:22.760 --> 0:19:26.640 are providing a professional health service. That's really key. They're 0:19:26.640 --> 0:19:30.560 not acting as manufacturers. They are not distributing devices. So 0:19:30.920 --> 0:19:34.679 LDTs are professional services, they're not devices. Right. If you 0:19:34.760 --> 0:19:38.520 think about how a lab is sort of integrated into 0:19:38.560 --> 0:19:42.560 patient care, it can often be the case that our 0:19:42.680 --> 0:19:46.040 member laboratories and the professionals they are in are providing 0:19:46.080 --> 0:19:48.879 advice and guidance to clinicians as they think about, you know, 0:19:48.960 --> 0:19:50.280 what tests should I order? 0:19:50.600 --> 0:19:50.719 Right? 0:19:50.840 --> 0:19:53.560 Which tests in the menu best suits the characteristics of 0:19:53.640 --> 0:19:57.800 the patient, So we can provide that support and guidance. Upfront, 0:19:58.520 --> 0:20:02.320 we receive the sample, there's pre analytics steps that take 0:20:02.400 --> 0:20:09.440 place or evolving sample preparation, perhaps amplification of samples, et cetera. 0:20:10.280 --> 0:20:14.600 And then there's the analysis of the test itself. And 0:20:14.640 --> 0:20:18.160 then when we take those analytics steps, there are things 0:20:18.200 --> 0:20:21.320 to consider. Nest we just don't deliver the results right 0:20:21.440 --> 0:20:25.120 or the data. There's post analytics steps that are important 0:20:25.119 --> 0:20:27.800 as well. Right, we want to make sure that we're 0:20:27.840 --> 0:20:33.400 confirming at that the test is accurately interpretive, quantified entered 0:20:33.400 --> 0:20:38.360 into the LIS. There's often conversations between our member company, 0:20:38.480 --> 0:20:42.680 laboratorians that are delivering that service with the clinician who 0:20:42.680 --> 0:20:44.879 had ordered to test, to ensure that they understand the 0:20:44.920 --> 0:20:49.520 results and are best able to leverage those results to 0:20:49.720 --> 0:20:53.480 drive the right patient care decision. So, in short, we 0:20:54.080 --> 0:20:58.080 do not believe the LDA has the authority. That's largely 0:20:58.200 --> 0:21:01.680 rooted in the fact that ldt are not medical devices, 0:21:01.680 --> 0:21:03.879 but they are in fact professional services. 0:21:04.480 --> 0:21:06.800 And so with that in mind, what strikes me about 0:21:06.840 --> 0:21:12.359 this is that this proposal impacts a lot of different stakeholders, 0:21:12.440 --> 0:21:21.399 so clinical laboratories, diagnostic manufacturers, academic medical centers, hospitals, patient groups, 0:21:22.000 --> 0:21:26.520 and where there's this disagreement, usually you see Congress try 0:21:26.600 --> 0:21:29.760 to come in and legislative solution, and you mentioned that earlier, 0:21:30.359 --> 0:21:33.080 specifically about the Ballot Act, and I'd like to dig 0:21:33.119 --> 0:21:37.160 into that for a second here. How has Congress tried 0:21:37.160 --> 0:21:41.480 to respond to these different views? And while we haven't 0:21:41.520 --> 0:21:44.919 seen Congress make progress in the past, you think that 0:21:45.040 --> 0:21:49.160 this proposal will be a catalyst for action this year. 0:21:49.560 --> 0:21:51.760 Granted it's an election year, so that's kind of tough, 0:21:51.840 --> 0:21:54.000 but can you walk us through what it is you're 0:21:54.000 --> 0:21:57.880 trying to accomplish within the legislative process. 0:21:58.640 --> 0:22:00.840 Sure, and I'm glad you raised a valid Act again 0:22:01.000 --> 0:22:04.080 because I think it bears hovering on for a moment. 0:22:05.160 --> 0:22:07.919 And while we did not endorse the Valid Act, we 0:22:08.000 --> 0:22:10.480 think there were that we were continuing to work on it. 0:22:10.520 --> 0:22:15.240 I mean that we made significant improvements to the Valid Act, 0:22:15.440 --> 0:22:18.160 and I want to just reflect on a few of those. 0:22:18.280 --> 0:22:18.480 Right. 0:22:20.280 --> 0:22:24.320 The Valid Act would have again established a diagnostic specific 0:22:24.680 --> 0:22:29.600 apparatus or regulatory framework for all diagnostics, so it would 0:22:29.640 --> 0:22:35.200 have better appreciated the characteristics of laboratories of laboratory developed 0:22:35.200 --> 0:22:39.000 tests of diagnostics in general. It would have had a 0:22:39.240 --> 0:22:43.360 meaningful grandfathering policy, which is critically important when we think 0:22:43.400 --> 0:22:48.040 about maintaining access patient access to tests that are available now. 0:22:49.200 --> 0:22:51.959 It would have had a transition period that allowed for 0:22:52.400 --> 0:22:57.119 multiple areas of notice and comment rulemaking over an extended 0:22:57.160 --> 0:23:02.240 period of time to allow for appropriate prepar preparation of implementation. 0:23:03.200 --> 0:23:06.040 And it would also have included a number of new 0:23:06.240 --> 0:23:10.680 attributes that are unavailable today under current law to the Agency, 0:23:11.240 --> 0:23:16.040 including something called technology certification, which broadly speaking, would have 0:23:16.240 --> 0:23:26.080 been a pathway for test developers to secure the approval 0:23:26.320 --> 0:23:31.800 of a suite of tests after the Agency had considered 0:23:32.680 --> 0:23:35.879 a single assay within that suite of tests, and it 0:23:35.920 --> 0:23:40.439 would have allowed for agreed upon change control protocols to 0:23:40.560 --> 0:23:43.840 be made after the test was on the market with 0:23:44.000 --> 0:23:48.160 notification back to the agency. So that concept of being 0:23:48.280 --> 0:23:51.880 able to pull in the latest scientific advancements and knowledge 0:23:51.880 --> 0:23:54.680 and have that be reflected in tests is something that 0:23:54.720 --> 0:24:00.439 would have been embraced through this technology certification pathway. We 0:24:00.760 --> 0:24:04.439 had a lot of favorable and productive discussions with the 0:24:04.480 --> 0:24:10.240 Agency throughout negotiations on the Hill on the valid Act. Again, 0:24:10.280 --> 0:24:14.200 we felt we made really strong progress. So we think 0:24:14.280 --> 0:24:19.280 that was a very positive step forward, and I will 0:24:19.280 --> 0:24:24.560 say we would certainly prefer that type of framework to 0:24:24.800 --> 0:24:28.960 what the FDA is doing now. When the Valid Act 0:24:29.000 --> 0:24:30.920 did not cross the finish line at the end of 0:24:31.000 --> 0:24:35.080 twenty twenty two, you know, we reconvened with the agency 0:24:35.480 --> 0:24:41.440 with other stakeholders, talked to bipartisan by cameral committees on 0:24:42.119 --> 0:24:46.359 these issues, and really encouraged everyone to reconvene again go 0:24:46.560 --> 0:24:49.760 back to the Hill right that legislation is the right direction. 0:24:49.960 --> 0:24:52.720 We were also very close there and we know kind 0:24:52.720 --> 0:24:55.280 of what those key attributes really need to be in 0:24:55.320 --> 0:24:58.200 the legislation, and so we're continuing to encourage that right 0:24:58.240 --> 0:25:01.040 we as we work with the agent and see we 0:25:01.080 --> 0:25:04.720 did provide robust comments to this proposed rule, but we 0:25:04.760 --> 0:25:07.840 are encouraging them to withdraw the rule, and for the 0:25:07.880 --> 0:25:12.000 reasons that we've mentioned that having to do with policy issues, 0:25:12.160 --> 0:25:15.760 ensuring patient access, having the latest technology but reflected in 0:25:15.800 --> 0:25:20.480 tests available to patients, and addressing this legal issue that 0:25:20.560 --> 0:25:23.159 we mentioned that legislation is the right pathway forward. So 0:25:23.200 --> 0:25:26.920 we're going to continue to encourage that be the direction forward. 0:25:27.400 --> 0:25:29.920 And I think that you mentioned a lot of stakeholders 0:25:30.640 --> 0:25:32.639 that have weighed in. You know, we've been reading a 0:25:32.640 --> 0:25:34.800 lot of the comment letters that have been posted, and 0:25:35.359 --> 0:25:38.719 there are a number of other organizations like US that 0:25:39.000 --> 0:25:43.520 are reflecting on the importance for Congress to be involved 0:25:43.520 --> 0:25:46.960 here right to have the right pathway forward, the ideal 0:25:47.000 --> 0:25:49.080 pathway forward be through legislation. 0:25:51.400 --> 0:25:54.760 And so for folks keeping track or trying to keep track, 0:25:54.840 --> 0:25:58.480 when we say the VALID Act, it's short for Verifying, Accurate, 0:25:59.000 --> 0:26:05.040 Leading Edge IVC Development Act, introduced by Congressman Bushan of 0:26:05.119 --> 0:26:09.479 Indiana and Congresswoman Diana to Get of Colorado. So it's 0:26:09.520 --> 0:26:13.720 a bipartisan bill and it remains to be seen what 0:26:13.760 --> 0:26:16.400 Congress is able to do this year again an election year. 0:26:17.000 --> 0:26:21.000 They're still trying to figure out appropriations funding for the 0:26:21.080 --> 0:26:26.160 current discal year five months late or later, so time 0:26:26.200 --> 0:26:29.280 will tell. But I do want to circle back to 0:26:29.640 --> 0:26:35.320 a comment you made earlier about the cost is associated 0:26:35.400 --> 0:26:41.320 with compliance. You get touched on it a bit. Can 0:26:41.359 --> 0:26:45.720 you just walk us through some of the economic and clients' 0:26:45.800 --> 0:26:50.119 costs under the device framework, because we did see the 0:26:50.200 --> 0:26:54.000 FDA put forward a number in terms of what the 0:26:54.080 --> 0:26:58.440 cost might be, and I wonder if that's how they 0:26:58.480 --> 0:27:02.199 get to that number that's even close? You know, is 0:27:02.240 --> 0:27:07.680 this going to impact certain labs disproportionately than others. 0:27:08.440 --> 0:27:12.560 Yeah, it's a great question, and you know, maybe I'll 0:27:12.600 --> 0:27:16.359 answer relatively high level and suggestive. Folks are interested in 0:27:16.760 --> 0:27:20.480 more detail in the ACLA comment letter to the agency. 0:27:20.520 --> 0:27:23.640 It's available on our website. We do have a robust 0:27:23.720 --> 0:27:28.480 section that addresses what we think the faulty assumptions are 0:27:28.840 --> 0:27:33.840 in the FDA's cost benefit analysis, and we make suggestions 0:27:33.840 --> 0:27:37.280 for a number of alternatives. In short, we think they 0:27:37.440 --> 0:27:45.320