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Support Regulatory Change to Boost Wisconsin’s Biotech Sector

Wisconsin’s business leaders in biotechnology and genetic testing know well the importance of federal regulations on analyte-specific reagents (ASRs), essentially the “active ingredients” of many genetic tests. Recent efforts to reform to these regulations could provide exciting opportunities for Wisconsin companies.

Under current regulations, manufactures of ASRs, unlike traditional medical device or drug companies, are permitted to sell many ASRs to certified clinical labs without having to establish their clinical validity and receive approval from the Food and Drug Administration (FDA). ASR manufacturers are not permitted to make claims about their products’ clinical performance or diagnostic ability. However, their customers often combine the ASRs to create “home brew” assays for diagnosing genetic disorders—all of which occurs without traditional FDA approval based on clinical evidence. Avoiding the long, expensive pre-market approval process has allowed companies producing ASRs to quickly commercialize their products.

But to many Wisconsin companies in the reagents business, the ASR regulations are a mixed blessing. On one hand, those regulations allow a fast and inexpensive way to get ASR products to market. But on the other hand, the regulations often deter these same companies from combining or improving upon their reagent technologies to create innovative, new diagnostic tools. This is largely because the law requires that assembled diagnostic tests, unlike individual ASRs, must be approved by the FDA just like traditional medical devices—a burden that simply is too large for some companies to bear. A company submitting an application for pre-market approval of a diagnostic test must submit a user fee that in some cases exceeds $200,000, and must incur the expense of running clinical trials, compiling data, and preparing the application itself. For obvious financial reasons, many ASR manufacturers choose not, or are forced not, to bring new diagnostic tests to market, and the promise of their technology remains unfulfilled.

Regulatory change is in the air. Wisconsin biotech companies should monitor the FDA’s actions closely over the coming months. Several dominant players in the in vitro diagnostics industry have proposed to the FDA a draft Guidance Document that would create a new category of “in vitro analytical tests” (IVATs). Under the IVAT proposal, companies could market diagnostic tests after establishing their analytical validity, but without establishing their clinical utility. One result of this proposal, significant to Wisconsin companies, would be that IVAT manufacturers would not have to submit clinical data to the FDA and endure the lengthy pre-market application process. They still would have to comply, however, with GMPs (good manufacturing practices) and demonstrate the specificity and sensitivity of their tests to the genetic mutations they are designed to detect.

Proponents of the IVAT system contend it would speed the transfer of innovative tests from R&D labs to the marketplace, while protecting the public health by requiring FDA review of the tests’ analytical performance. Under the proposed system, when an innovator develops a new test (such as Madison’s EraGen Biosciences’ SARS test), the manufacturer could more quickly provide it to health care labs, bypassing the lengthy process of first establishing clinical validity. Potential opponents of the IVAT proposal, which likely includes the FDA, are concerned that the lack of a pre-market requirement for establishing clinical validity will diminish the incentive for sponsors ever to proceed with clinical trials, even though such research would be valuable. Others are concerned that the proposed IVAT system is too favorable to large companies, such as the ones who proposed it, and would not benefit newcomers or smaller businesses in the industry.
Last week, at a roundtable meeting with industry representatives, Steven Gutman, M.D. (director of the FDA’s Office of In Vitro Diagnostics) indicated that the Agency is revisiting the ASR regulations, but is not prepared yet to issue any new guidance or new rules. It appears unlikely that the IVAT proposal will be applied as broadly as its proponents have hoped. One of the Agency’s primary concerns, it appears, is that the IVAT proposal may not adequately assess the clinical risk of new products. However, in reviewing applications for in vitro tests that are considered low-risk and involve well known, established analytes, the Agency has applied the IVAT model. In any event, ASR regulation remains a subject of much debate, and will likely see considerable changes in the coming months and years.

Changing the regulatory landscape could help Wisconsin reagents companies expand into the market for diagnostics, and could help companies already active in the diagnostics business bring their products to market faster. Though the current IVAT proposal may be too sweeping for the FDA to fully implement it, it does represent much of the industry’s perspective on regulatory reform. The Wisconsin biotech community—particularly its reagents and diagnostics companies—should contribute to reforming the ASR regulations, and make its voice heard through trade groups and communications with the FDA. The dialogue has begun, and our local biotech leaders should exploit this opportunity to assert their influence over the regulation of their industry.

Mr. Gross is a member of LaFollette Godfrey & Kahn’s FDA Consulting Practice. His law practice focuses on FDA law, intellectual property, and the business and legal aspects of biotechnology. He can be reached at


Thomas L. Rummel responded 10 years ago: #1

I just came across this article and had to let you know that I read it. You're an important man Gabriel S. Gross Esquire. Hope all is well. I'll let you kow when I'm coming to Madison next....probably not till this summer, but we'll see. Till we see each other again I wish your family the best.

Take care.


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