The Evolution of Genetic Health Testing Regulation

By: Chad Ozbeki

After the completion of the Human Genome Project in 2003, a Silicon Valley-based startup developed and began commercializing a genetic health test kit.[1]  With the aim of democratizing personal health care data and empowering consumers, the startup bypassed the medical provider community and marketed their genetic health test directly to consumers.[2]  This was a disruptive game-changer—the test kit provided insight into a given consumer’s ancestry and a prospective outlook of their genetic predisposition to several diseases and conditions.[3]  After raising a considerable amount of capital, bringing on a team of Silicon Valley veterans, and developing a product capable of testing for more than 250 diseases and conditions, it all came to a screeching halt with a warning letter from the Food and Drug Administration (“FDA”).[4]  For disruptive startups in a highly regulated industry like health care, regulatory ambiguity cuts both ways—it can present as tremendous upside potential or, conversely, predispose a company to an early demise.

Stunted Growth

The direct-to-consumer genetic testing market came to a standstill in November 2013.  The FDA issued the aforementioned warning letter to 23andMe—a pioneer of direct-to-consumer genetic health testing—and declared their genetic health testing kit to be in violation of the Food Drug & Cosmetic Act (“FD&C Act”). [5]   A warning letter is an official FDA notification issued to a company after the agency has identified a significant violation, which then requires the company to address the violation and communicate a remediation plan within a given timeframe.[6]  Pursuant to section 201(h) of the FD&C Act, the FDA declared 23andMe’s genetic health testing kit to be a device based on its intended “[u]se in the diagnosis of disease or other conditions or in the cure, mitigation, treatment, or prevention of disease, or is intended to affect the structure or function of the body” and, therefore, in violation of the FD&C Act because it had “[n]ot been classified and [required] premarket approval or de novo classification.”[7]  As a result, the test kit was effectively reduced to a genetic testing tool for ancestry.[8]

Learn and Adapt

In 2015, in a first step for the FDA, the agency approved the first direct-to-consumer genetic carrier test—a category of genetic health testing focused on consumers who may be at risk for passing on a recessive genetic disorder to their children (e.g., Bloom Syndrome).[9]  This approval was based on two policy rationales that must be included as strategic imperatives for any startup planning to enter the genetic health testing market.  The first is grounded in consumer access.  The FDA has taken the position that in “[m]any circumstances it is not necessary for consumers to go through a licensed practitioner to have direct access to their personal genetic information.”[10]  To that end, this category of genetic health testing has been exempted from pre-market review.  The second policy rationale is grounded in consumer safety and protection.  In its approval, the FDA placed carrier genetic tests in a lower device classification (class II) to reduce the regulatory burden and, therefore, subjected this category of genetic health tests to general and special regulatory controls designed to ensure safety and effectiveness.[11]  In an effort to further enhance consumer safety and protection, the FDA required the genetic carrier test to present test results in a way “[t]hat consumers [could] understand and use,” and include a product label explaining what the results could potentially mean.[12]  This is akin to the approach the FDA utilizes with other direct-to-consumer tests (e.g., pregnancy tests).[13] 

Dynamically Evolving  

These twin policy aims are the underpinnings of FDA’s evolving approach to regulating direct-to-consumer genetic health tests—now referenced as genetic health risk tests, or “GHRs.”  Consumers are becoming more engaged in their own health care in many ways, such as counting their steps, tracking their heart rates, and monitoring their sleep patterns—just to name a few.  And, similar to these new technology-derived insights, GHRs also present an opportunity for consumers to learn more about their health and make more informed lifestyle choices.[14]  However, the public health benefits of increased consumer engagement and access to personalized health care insights also presents a unique challenge.  As the FDA Commissioner has stated, “[t]hese technologies don’t fit squarely into our traditional risk-based approach to device regulation.”[15]

In April of this year, the FDA approved the first direct-to-consumer GHR for ten (10) diseases and conditions, which includes Parkinson’s disease, late-onset Alzheimer’s disease, and Celiac disease.[16]  Like the aforementioned genetic carrier test approval, the newly approved GHR is subject to general and special controls to ensure safety and effectiveness.[17]  Both approvals granted marketing rights to the same trailblazing startup—none other than 23andMe.  And, with this approval, the agency signaled its plans toward regulating GHRs.  That is to say, the FDA exempted “[a]dditional 23andMe GHR tests from FDA’s premarket review” and stated that tests “[f]rom other makers may be exempt after submitting their first premarket notification.”18

The regulatory shift to reviewing and approving the company manufacturing the genetic health test, rather than the specific test itself, was reinforced in FDA’s recently announced plan to streamline the development and regulatory pathway of GHRs.19  The agency intends to implement “[a] novel regulatory approach…that applies proper oversight in a flexible, new way.”20  In other words, the FDA plans to execute a one-time review of a company to ensure it meets certain FDA requirements and, once approved, subsequent tests from an “FDA-approved” company will be exempt from premarket review.21  The implications of this “firm-based” regulatory framework22—similar to that of the digital health pre-certification pilot—will allow GHRs to enter the marketplace, and strikes a balance between the aforementioned twin policy aims of consumer access and consumer safety and protection. 

Conclusion

Regulatory ambiguity can present as an unwelcomed malady threatening a startup’s viability, while also presenting as an opportunity to disrupt an industry and engage with regulators to shift the traditional paradigm.23  The recent regulatory shift provides clarity to entrepreneurs entering the direct-to-consumer genetic health testing market.  And, unlike more established startups in this rapidly evolving industry—“established” is a relative term—newly funded startups have more clarity on what processes, methodologies, and controls must be in place prior to engaging with regulators.  This translates to smarter capital allocation and more predictability in developing and executing a go-to-market strategy.  In other words, startups now have a better understanding of the “input” needed to secure FDA approval.  Therefore, this four-year evolutionary snapshot of the genetic health testing regulatory framework highlights the risk of regulatory ambiguity, and the important impact startups can have in shifting the landscape.

[1] Wired (Nov. 2007)

[2] Fast Company (Oct. 2015)

[3] Wired (Nov. 2007)

[4] Fast Company (Oct. 2015)

[5] FDA Warning Letter (Nov. 2013)

[6] FDA Warning Letter FAQ (Nov. 2017)

[7] FDA Warning Letter (Nov. 2013)

[8] Fast Company (Oct. 2015)

[9] FDA Press Release (Feb. 2015)san test kit 2015)ragraph becauslast four years.nderstanding the evolution of FDA'dMe is introduced in the next paragraph becaus

[10] FDA Press Release (Feb. 2015)

[11] FDA Regulatory Controls (June 2014)

[12] FDA Press Release (Feb. 2015)

[13] FDA Press Release (Feb. 2015)

[14] FDA Commissioner Statement (Nov. 2017)

[15] FDA Commissioner Statement (Nov. 2017)

[16] FDA Press Release (April 2017)

[17] FDA Press Release (April 2017)

18 FDA Press Release (April 2017)

19 Stat News (Nov. 2017)

20 FDA Commissioner Statement (Nov. 2017)

21 FDA Commissioner Statement (Nov. 2017)

22 FDA Commissioner Statement (Nov. 2017)

23 Fast Company (Oct. 2015)