    [House Hearing, 114 Congress]
    [From the U.S. Government Publishing Office]

     EXAMINING THE REGULATION OF DIAGNOSTIC TESTS AND LABORATORY OPERATIONS

    =======================================================================

                                     HEARING

                                   BEFORE THE

                             SUBCOMMITTEE ON HEALTH

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                        ONE HUNDRED FOURTEENTH CONGRESS

                                 FIRST SESSION

                                   __________

                               NOVEMBER 17, 2015

                                   __________

                               Serial No. 114-100

    [GRAPHIC NOT AVAILABLE IN TIFF FORMAT]

          Printed for the use of the Committee on Energy and Commerce

                            energycommerce.house.gov

                                  ___________

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                       COMMITTEE ON ENERGY AND COMMERCE

                              FRED UPTON, Michigan
                                     Chairman

    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Chairman Emeritus                    Ranking Member
    ED WHITFIELD, Kentucky               BOBBY L. RUSH, Illinois
    JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
    JOSEPH R. PITTS, Pennsylvania        ELIOT L. ENGEL, New York
    GREG WALDEN, Oregon                  GENE GREEN, Texas
    TIM MURPHY, Pennsylvania             DIANA DeGETTE, Colorado
    MICHAEL C. BURGESS, Texas            LOIS CAPPS, California
    MARSHA BLACKBURN, Tennessee          MICHAEL F. DOYLE, Pennsylvania
      Vice Chairman                      JANICE D. SCHAKOWSKY, Illinois
    STEVE SCALISE, Louisiana             G.K. BUTTERFIELD, North Carolina
    ROBERT E. LATTA, Ohio                DORIS O. MATSUI, California
    CATHY McMORRIS RODGERS, Washington   KATHY CASTOR, Florida
    GREGG HARPER, Mississippi            JOHN P. SARBANES, Maryland
    LEONARD LANCE, New Jersey            JERRY McNERNEY, California
    BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
    PETE OLSON, Texas                    BEN RAY LUJAN, New Mexico
    DAVID B. McKINLEY, West Virginia     PAUL TONKO, New York
    MIKE POMPEO, Kansas                  JOHN A. YARMUTH, Kentucky
    ADAM KINZINGER, Illinois             YVETTE D. CLARKE, New York
    H. MORGAN GRIFFITH, Virginia         DAVID LOEBSACK, Iowa
    GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
    BILL JOHNSON, Ohio                   JOSEPH P. KENNEDY, III,
    BILLY LONG, Missouri                 Massachusetts
    RENEE L. ELLMERS, North Carolina     TONY CARDENAS, California7
    LARRY BUCSHON, Indiana
    BILL FLORES, Texas
    SUSAN W. BROOKS, Indiana
    MARKWAYNE MULLIN, Oklahoma
    RICHARD HUDSON, North Carolina
    CHRIS COLLINS, New York
    KEVIN CRAMER, North Dakota

                             Subcommittee on Health

                         JOSEPH R. PITTS, Pennsylvania
                                     Chairman
    BRETT GUTHRIE, Kentucky              GENE GREEN, Texas
      Vice Chairman                        Ranking Member
    ED WHITFIELD, Kentucky               ELIOT L. ENGEL, New York
    JOHN SHIMKUS, Illinois               LOIS CAPPS, California
    TIM MURPHY, Pennsylvania             JANICE D. SCHAKOWSKY, Illinois
    MICHAEL C. BURGESS, Texas            G.K. BUTTERFIELD, North Carolina
    MARSHA BLACKBURN, Tennessee          KATHY CASTOR, Florida
    CATHY McMORRIS RODGERS, Washington   JOHN P. SARBANES, Maryland
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
    GUS M. BILIRAKIS, Florida            KURT SCHRADER, Oregon
    BILLY LONG, Missouri                 JOSEPH P. KENNEDY, III,
    RENEE L. ELLMERS, North Carolina         Massachusetts
    LARRY BUCSHON, Indiana               TONY CARDENAS, California
    SUSAN W. BROOKS, Indiana             FRANK PALLONE, Jr., New Jersey (ex
    CHRIS COLLINS, New York                  officio)
    JOE BARTON, Texas
    FRED UPTON, Michigan (ex officio)

                                      (ii)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Joseph R. Pitts, a Representative in Congress from the
      Commonwealth of Pennsylvania, opening statement................     1
        Prepared statement...........................................     3
    Hon. Gene Green, a Representative in Congress from the State of
      Texas, opening statement.......................................     4
        Prepared statement...........................................     5
    Hon. Michael C. Burgess, a Representative in Congress from the
      State of Texas, opening statement..............................     6
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     8
        Prepared statement...........................................     9
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, prepared statement...................................    65
    Hon. Renee L. Ellmers, a Representative in Congress from the
      State of North Carolina, prepared statement....................    66

                                   Witnesses

    Jeffrey Shuren, M.D., Director, Center for Devices and
      Radiological Health, Food and Drug Administration, Department
      of Health and Human Services...................................    10
        Prepared statement...........................................    12
        Answers to submitted questions \1\...........................    84
    Patrick Conway, M.D., Acting Principal Deputy Administrator,
      Deputy Administrator for Innovation and Quality, and Chief
      Medical Officer, Centers for Medicare and Medicaid Services,
      Department of Health and Human Services........................    24
        Prepared statement...........................................    26
        Answers to submitted questions...............................    85

                               Submitted Material

    Discussion Draft, H.R. ___, submitted by Mr. Pitts\2\
    Letter of November 16, 2015, from American Clinical Laboratory
      Association, et al., to the Honorable Lamar Alexandar, et al.,
      submitted by Mr. Pitts.........................................    67
    Letter of November 11, 2015, from Action to Cure Kidney Cancer,
      et al., to Mr. Upton, et al., submitted by Mr. Pitts...........    70
    Letter of November 16, 2015, from Dick Woodruff, Vice President,
      Federal Relations, American Cancer Society Cancer Action
      Network, to Mr. Upton and Mr. Pallone, submitted by Mr. Green..    72
    Statement of the Association for Molecular Pathology, November
      17, 2015, submitted by Mr. Burgess.............................    74
    Letter of November 16, 2015, from Jan A. Nowak, Clinical Chief of
      Molecular Pathology, Roswell Park Cancer Institute, to Mr.
      Collins, submitted by Mr. Collins..............................    77

    ----------
    \1\ Dr. Shuren did not answer submitted questions for the record by the
    time of printing.
    \2\ The discussion draft has been retained in committee files and also
    is available at  http://docs.house.gov/meetings/IF/IF14/20151117/
    104127/BILLS-114pih-HR--------.pdf.
    Report by the Office of Public Health Strategy and Analysis,
      Office of the Commissioner, Food and Drug Administration, ``The
      Public Health Evidence for FDA Oversight of Laboratory
      Developed Tests: 20 Case Studies,'' November 16, 2015,
      submitted by Mr. Green \3\
    Letter of November 17, 2015, from David D. Koch, President,
      American Association of Clinical Chemistry, to Mr. Upton, et
      al., submitted by Mr. Burgess..................................    79

    ----------
    \3\ The report has been retained in committee files and also is
    available at  http://docs.house.gov/meetings/IF/IF14/20151117/104127/
    HMTG-114-IF14-20151117-SD009.pdf.

     EXAMINING THE REGULATION OF DIAGNOSTIC TESTS AND LABORATORY OPERATIONS

                                  ----------

                           TUESDAY, NOVEMBER 17, 2015

                      House of Representatives,
                                Subcommittee on Health,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:03 a.m., in
    room 2322, Rayburn House Office Building, Hon. Joseph R. Pitts
    (chairman of the subcommittee) presiding.
        Members present: Representatives Pitts, Guthrie, Barton,
    Shimkus, Murphy, Burgess, Blackburn, Lance, Griffith,
    Bilirakis, Long, Ellmers, Bucshon, Brooks, Collins, Green,
    Capps, Butterfield, Castor, Schrader, Kennedy, Cardenas, and
    Pallone (ex officio).
        Staff present: Rebecca Card, Assistant Press Secretary;
    Carly McWilliams, Professional Staff Member, Health; Graham
    Pittman, Legislative Clerk; Heidi Stirrup, Health Policy
    Coordinator; John Stone, Counsel, Health; Christine Brennan,
    Democratic Press Secretary; Jeff Carroll, Democratic Staff
    Director; Tiffany Guarascio, Democratic Deputy Staff Director
    and Chief Health Advisor; Samantha Satchell, Democratic Policy
    Analyst; and Kimberlee Trzeciak, Democratic Health Policy
    Advisor.
        Mr. Pitts. The subcommittee will come to order. The Chair
    will recognize himself for an opening statement.

    OPENING STATEMENT OF HON. JOSEPH R. PITTS, A REPRESENTATIVE IN
             CONGRESS FROM THE COMMONWEALTH OF PENNSYLVANIA

        Throughout the 21st Century Cures initiative, biomarkers,
    precision medicine, and targeted therapies were a few of the
    most consistently uttered terms and concepts. In order to
    advance each of them, we must establish a regulatory
    environment that fosters the development of, and access to,
    innovative, accurate, and reliable diagnostic testing. Such
    tests are increasingly important not only in diagnosing the
    onset of a specific disease or condition, but in determining
    the right course of treatment or procedure.
        It goes without saying that tests providing information to
    a doctor or consumer are fundamentally different products than
    traditional medical devices, which actually deliver therapy to,
    or are implanted in, a patient. Nonetheless, while FDA has used
    its medical device authorities to review and oversee tests
    developed by outside entities that are then sold to
    laboratories, the agency has not actively regulated laboratory-
    developed tests, or LDTs.
        Last year, a week after we held a roundtable downstairs
    that highlighted the importance of this very topic, FDA
    announced that it would no longer exercise such enforcement
    discretion and detailed how the agency proposes to apply its
    medical device authorities to LDTs.
        Today, I am far less interested in litigating the
    boundaries of current FDA or CMS legal authority, but in
    hearing from our witnesses how such authority could be
    clarified or improved, understanding the unique and evolving
    nature of what is being regulated and each agency's area of
    expertise.
        In response to a white paper the committee circulated at
    the end of last year asking these very questions, we heard from
    a number of labs and pathologists that FDA should only have a
    limited role, if any, in regulating a select set of tests as
    medical devices. The rest, in their opinion, should be overseen
    by CMS through an updated Clinical Laboratory Improvement
    Amendments program. This is despite the fact that CMS has
    stated that they do not have the resources, the expertise, or
    the willingness to take on what is being asked of them. I am
    eager to hear what Dr. Conway has to say on this matter.
        We also received comments from a number of manufacturers,
    as well as over 40 patient groups, that FDA, not CMS, needs to
    be in the driver's seat, and that tests that have the same
    impact on a patient should be held to the same standards,
    regardless of who does the development. This is despite the
    fact that laboratories are uniquely nimble environments where
    pathologists continually modify and improve tests in ways that
    manufacturers cannot.
        I am well aware that this has been at times a heated debate
    with passionate advocates on both sides. With such a backdrop,
    I want to particularly commend the manufacturers, the
    laboratories, and other healthcare institutions that have been
    willing to roll up their sleeves and find as much common ground
    as possible through constructive dialogue, a willingness to
    compromise, and a pragmatic understanding of what a viable,
    modern framework entails.
        I do not believe that imposing a new regulatory reality on
    an increasingly important component of our healthcare system
    via guidance is the best way to address these issues. These
    products warrant a regulatory system designed with them in
    mind. They should not be shoehorned into a system that was
    drafted in the 1970s.
        This committee has clearly shown that we are willing and
    able to move complicated, comprehensive, bipartisan
    legislation. The discussion draft the committee circulated,
    along with the hearing notice, is of course not perfect, but it
    is a serious document based on significant consensus, and I
    would ask that all of the stakeholders out there, including our
    two distinguished witnesses, help us improve it as the process
    continues.
        With that, I would like to thank Dr. Shuren, a frequent,
    always welcome visitor, as well as Dr. Conway, for their
    willingness to testify today, and I look forward to working
    with them on these issues going forward.
        [The discussion draft is available at  http://
    docs.house.gov/meetings/IF/IF14/20151117/104127/BILLS-114pih-
    HR--------.pdf.]
        [The prepared statement of Mr. Pitts follows:]

                   Prepared statement of Hon. Joseph R. Pitts

        Throughout the 21st Century Cures initiative,
    ``biomarkers,'' ``precision medicine,'' and ``targeted
    therapies'' were a few of the most consistently uttered terms
    and concepts. In order to advance each of them, we must
    establish a regulatory environment that fosters the development
    of and access to innovative, accurate and reliable diagnostic
    testing.
        Such tests are increasingly important, not only diagnosing
    the onset of a specific disease or condition, but in
    determining the right course of treatment or procedure. It goes
    without saying that tests providing information to a doctor or
    consumer are fundamentally different products than traditional
    medical devices which actually deliver therapy to or are
    implanted in a patient. Nonetheless, while FDA has used its
    medical device authorities to review and oversee tests
    developed by outside entities that are then sold to
    laboratories, the agency has not actively regulated laboratory
    developed tests, or LDTs.
        Last year, a week after we held a roundtable downstairs
    that highlighted the importance of this very topic, FDA
    announced that it would no longer exercise such enforcement
    discretion and detailed how the agency proposes to apply its
    medical device authorities to LDTs.
        Today, I am far less interested in litigating the
    boundaries of current FDA or CMS legal authority than in
    hearing from our witnesses about how such authority could be
    clarified or improved, understanding the unique and evolving
    nature of what it is being regulated and each agency's areas of
    expertise.
        In response to a white paper the committee circulated at
    the end of last year asking these very questions, we heard from
    a number of labs and pathologists that FDA should only have a
    limited role, if any, in regulating a select set of tests as
    medical devices. The rest, in their opinion, should be overseen
    by CMS, through an updated Clinical Laboratory Improvement
    Amendments program. This is despite the fact that CMS has
    stated that they do not have the resources, the expertise or
    the willingness to take on what is being asked of them. I am
    eager to hear what Dr. Conway has to say on the matter.
        We also received comments from a number of manufacturers,
    as well as over forty patient groups, that FDA-not CMS-needs to
    be in the driver's seat and that tests that have the same
    impact on a patient should be held to the same standards,
    regardless of who does the development. This is despite the
    fact that laboratories are uniquely nimble environments where
    pathologists continually modify and improve tests in ways that
    manufacturers cannot.
        I am well aware that this has been, at times, a heated
    debate with passionate advocates on both sides. With such a
    backdrop, I want to particularly commend the manufacturers,
    laboratories, and other healthcare institutions that have been
    willing to roll up their sleeves and find as much common ground
    as possible through constructive dialogue, a willingness to
    compromise, and a pragmatic understanding of what a viable,
    modern framework entails.
        I do not believe imposing a new regulatory reality on an
    increasingly important component of our healthcare system via
    guidance is the best way to address these issues. These
    products warrant a regulatory system designed with them in
    mind. They should not be shoehorned into a system that was
    drafted in the 1970s.
        This committee has clearly shown that we are willing and
    able to move complicated, comprehensive, bipartisan
    legislation. The discussion draft the committee circulated
    along with the hearing notice is of course not perfect, but it
    is a serious document based on significant consensus. I would
    ask that all of the stakeholders out there, including our two
    distinguished witnesses, help us improve it as this process
    continues.
        With that I would like to thank Dr. Shuren-a frequent and
    always welcome visitor-as well as Dr. Conway, for their
    willingness to testify today. I look forward to working with
    them on these issues going forward.

        Mr. Pitts. And I now recognize the ranking member, Mr.
    Green, 5 minutes for his opening statement.

       OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN
                    CONGRESS FROM THE STATE OF TEXAS

        Mr. Green. Thank you, Mr. Chairman, and thank you for
    calling this hearing today, and I want to welcome our witnesses
    from the FDA and the CMS.
        The role of diagnostic tests in our healthcare system has
    changed dramatically since Congress passed the medical device
    amendments in 1976 and added in vitro diagnostics to the device
    definition. It has been almost 4 decades, and the evolution of
    modern medicine and the advancement of science has surpassed
    what everyone could imagine at the time. The enthusiasm around
    precision medicine is high, and the potential of diagnostics to
    further transform the treatment of disease is limitless.
        When the FDA first began regulating medical devices,
    applicable regulatory requirements for lab-developed tests, or
    LDTs, were not enforced because they were relatively simple
    tests, generally combined the local labs, and frequently used
    for rare conditions.
        Today, LDTs have increased in complexity and availability.
    They are often used to diagnose serious medical conditions, and
    many have major impact on patient care. Not only have LDTs
    become sophisticated, the role that these tests play in
    delivery of health care has expanded.
         The Centers for Disease Control and Prevention estimated
    that approximately 6.8 billion laboratory tests are
    administered each year. An analysis found that results from the
    clinical laboratory tests influence about 70 percent of
    healthcare decisions.
        The clinical laboratory amendments of 1988 created minimum
    standards of quality for all clinical labs in the country. The
    Centers for Medicare and Medicaid Services, CMS, has
    jurisdiction over the program, and CLIA has successfully
    improved the quality of the clinical labs in accuracy of
    testing for nearly 25 years.
        However, under CLIA CMS does not confirm the clinical
    validation of LDTs, meaning that they do not look as to whether
    it is a particular test accurately that identifies, measures,
    or predicts the absence or the presence of a clinical
    condition. These known gaps in oversight have been a source of
    concern to this committee and to the healthcare community at
    large.
        Yesterday, the Food and Drug Administration released a
    report that included 20 case studies of problematic tests from
    labs that were following the minimum requirements of CLIA but
    proposed real risk to patients. In an area of so much promise
    and significance to patient care, the accuracy, reliability,
    and clinical meaningfulness of all diagnostic tests, regardless
    of where they are created, must be a top priority for
    healthcare providers, test developers, regulators, and
    lawmakers.
        Last year, the FDA issued a draft regulatory framework to
    phase in enforcement regulatory requirements, including
    premarket review, adverse event reporting for LDTs that pose
    greater risk to patients if their results are not accurate and
    reliable. And I appreciate FDA's efforts to ensure that tests
    are supported by rigorous evidence and that patients and
    healthcare providers can have confidence in their results.
        That said, I share the opinion of my colleagues that
    legislation is both appropriate and necessary to modernize
    clinical laboratory diagnostic oversight. The legislative
    solution is surely the surest way to establish a framework that
    will be embraced by stakeholders, avoid litigation, extended
    uncertainty, and foster innovation of new clinical diagnostic
    tests.
        The FDA's approach to this draft guidance let to a number
    of important questions, but the guidance documents also spurred
    a larger conversation about the overarching need to modernize
    oversight of these unique and increasingly important tests.
        During the 21st Century Cures initiative, as part of the
    broad effort to close the gap between science of cures and how
    we regulate medical products, the committee hosted a roundtable
    on precision medicine and advances in diagnostic testing. The
    committee also released a white paper on diagnostic test
    regulation and received outpouring of feedback from
    stakeholders.
        While all parties did not agree on all the principles, much
    less specifics, it was abundantly clear that any regulatory
    framework for diagnostic tests must prioritize patient benefit
    and allow for continued innovation and investment through
    regulatory certainty and appropriate regulatory controls.
        There is urgent need to establish clear and logical lines
    separating the practice of medicine and the actual conduct of
    the diagnostic tests and the development and manufacturing of
    diagnostic tests so that the promise of 21st century medicine
    can be fully realized.
        Today, we will hear from FDA and CMS about each agency's
    respective role in the oversight and regulation of clinical
    laboratory tests. Members of the committee will have questions
    about the appropriate role of each agency and any updated
    framework, and how Congress can best promote robust investment
    and innovation while protecting patient safety.
        Mr. Chairman, I look forward to hearing from our witnesses,
    and I yield back.
        [The prepared statement of Mr. Green follows:]

                     Prepared statement of Hon. Gene Green

        Good morning, and thank you all for being here today.
        The role of diagnostic tests in our healthcare system has
    changed dramatically since Congress passed the Medical Device
    Amendments in 1976 and added in-vitro diagnostics to the device
    definition.
        It has been almost four decades, and the evolution of
    modern medicine and advancement of science has surpassed what
    anyone could have imagined at that time.
        The enthusiasm around precision medicine is high, and the
    potential of diagnostics to further transform the treatment of
    disease is limitless.
        When FDA first began regulating medical devices, applicable
    regulatory requirements for lab-developed tests or ``LDTs''
    were not enforced because they were relatively simple tests,
    generally confined to local labs, and frequently used for rare
    conditions.
        Today, LDTs have increased in complexity and availability.
    They are often used to diagnose serious medical conditions, and
    many have a major impact on patient care.
        Not only have LDTs become more sophisticated, the role
    these tests play in the delivery of health care has expanded.
        The Centers for Disease Control and Prevention estimated
    that approximately 6.8 billion laboratory tests are
    administered each year.
        Another analysis found that results from clinical
    laboratory tests influence around 70 percent of healthcare
    decisions.
        The Clinical Laboratory Amendments of 1988 created minimum
    standards of quality for all clinical labs in the country.
        The Centers for Medicare and Medicaid Services (CMS) has
    jurisdiction over the program, and CLIA has successfully
    improved the quality of clinical labs and accuracy of testing
    for nearly 25 years.
        However, under CLIA, CMS does not confirm the clinical
    validity of LDTs, meaning they do not look at whether a
    particular test accurately identifies, measures, or predicts
    the absence or presence of a clinical condition.
        These known gaps in oversight have been a source of concern
    to this committee, and to the healthcare community at large.
        Yesterday, the Food and Drug Administration (FDA) released
    a report that included 20 case studies of problematic tests
    from labs that were following the minimum requirements of CLIA,
    but posed real risk to patients.
        In an of area so such promise and significance to patient
    care, the accuracy, reliability and clinical meaningfulness of
    all diagnostic tests--regardless of where they are created--
    must be a top priority of healthcare providers, test
    developers, regulators, and lawmakers.
        Last year, the FDA issued a draft regulatory framework to
    phase in enforcement of regulatory requirements, including
    premarket review and adverse event reporting, for LDTs that
    pose greater risk to patients if their results are not accurate
    and reliable.
        I appreciate the FDA's efforts to ensure that tests are
    supported by rigorous evidence, and that patients and
    healthcare providers can have confidence in their results.
        That said, I share the opinion of my colleagues that
    legislation is both appropriate and necessary to modernize
    clinical laboratory diagnostics oversight.
        A legislative solution is the surest way to establish a
    framework that will be embraced by stakeholders, avoid
    litigation and extended uncertainty, and foster innovation of
    new clinical diagnostic tests.
        The FDA's approach in its draft guidance led to a number of
    important questions, but the guidance documents also spurred a
    larger conversation about the overarching need to modernize
    oversight of these unique and increasingly important tests.
        During the 21st Century Cures Initiative, as part of the
    broad effort to close the gap between the science of cures and
    how we regulate medical products, the committee hosted a
    roundtable on precision medicine and advances in diagnostic
    testing.
        The committee also released a white paper on diagnostic
    test regulation, and received an outpouring of feedback from
    stakeholders.
        While all parties did not agree on all principles, much
    less specifics, it was abundantly clear that any regulatory
    framework for diagnostic tests must prioritize patient benefit,
    and allow for continued innovation and investment through
    regulatory certainty and appropriate regulatory controls.
        There is an urgent need to establish clear and logical
    lines separating the practice of medicine, the actual
    conducting of a diagnostic test and the development and
    manufacturing of such tests, so that the promise of 21st
    century medicine can be fully realized.
        Today, we will hear from FDA and CMS about each agency's
    respective role in the oversight and regulation of clinical
    laboratory testing.
        Members of the committee will have questions about the
    appropriate role of each agency in any updated framework, and
    how Congress can best promote robust investment and innovation,
    while protecting patient safety.
        I look forward to hearing from our witnesses and I yield
    back the balance of my time.

        Mr. Pitts. The Chair thanks the gentleman, now recognizes
    Dr. Burgess in lieu of Chairman Upton, 5 minutes.

    OPENING STATEMENT OF HON. MICHAEL C. BURGESS, A REPRESENTATIVE
                  IN CONGRESS FROM THE STATE OF TEXAS

        Mr. Burgess. Thank you, Mr. Chairman.
        I appreciate the opportunity that we have before us with
    this hearing, but I do want to say at the outset, with
    everything else that is going on, this may be one of the most
    important and at the same time the most frightening concepts
    that is before the Congress right now. We are talking about a
    proposal that may not just stifle but eliminate medical
    innovation, something which this country has excelled for
    decades, and we are also opening the door for the first Federal
    regulation of the practice of medicine, not the needles and IV
    solutions, the actual diagnostic thought processes that go in
    to practicing medicine.
        Let me just say at the outset I do strongly believe in the
    potential of genomic medicine. I understand how important it is
    to really understand illness at a molecular level, quickly
    diagnose it, and get the treatment that is appropriate for the
    patient with a minimal amount of side effects.
        A year and a half ago, when the President talked about
    precision medicine during his State of the Union Address, I
    thought that was a very positive development. There are not
    many places where the White House and I agree on anything, but
    here was some common ground, and I took it to heart.
        Laboratory testing produces the informational building
    blocks that are at the heart of precision medicine. As former
    Administrator Mark McClellan at CMS said, we have got to get
    the right treatment at the right time to the right patient.
        We are not talking about test kits that are put in a box
    and shipped across State lines but medical procedures that are
    carried out by highly trained and qualified health
    professionals engaged in the practice of medicine.
        As we discuss the oversight of laboratory-developed tests,
    it is crucial that we do not slow innovation or create
    unnecessary regulatory hurdles. We have got to ask ourselves
    first, what is the problem that we are trying to solve, and is
    our response appropriate, and are there unintended consequences
    that could result?
        Requiring premarket review by the FDA will impose new and
    arguably unnecessary requirements and costs on clinical
    laboratories, hospitals, and doctors. Although an additional
    review of certain tests may be warranted, I actually have a
    greater confidence in a CLIA-centric approach, but there are
    others--and certainly people on this committee--who suggested a
    different track. But it remains unclear to me how we can
    separate the practice of medicine from these laboratory
    processes, and if we cannot, are we effectively opening the
    door to the Federal regulation of the practice of medicine? I
    reject that notion and believe by segmenting this process out
    has to be the fundamental first step of any proposal.
        Let me just reiterate I do want to be involved in this
    discussion. There is no question in my mind that CLIA can be
    improved. I was not a fan when CLIA came to my medical practice
    in 1988. I was not a fan of having to become a CLIA-certified
    location. I was not a fan of having to apply for a CLIA waiver.
    But since that time, I think arguably you can make the case
    that CLIA has been a useful enterprise.
        Look, we want doctors and patients to benefit from
    clinically valid tests, and the current FDA proposal, as such,
    creates regulatory uncertainty that will not be a catalyst for
    innovation.
        We talk a lot about the Administrative Procedures Act, we
    talk a lot about notice of proposed rulemaking. This is not
    coming through the normal regulatory process. It is coming as a
    guidance. My understanding is to be issued at the end of this
    year, and like it or not, there you have it.
        But, you know, it is hard. On this committee I still retain
    that romantic notion that our Government exists with the
    consent of the governed. In my mind that would not include
    issuing guidances, fiats that are expected to be followed, but
    rather, you go through the normal administrative procedures,
    hear people out, and make the best decision based on the
    information.
        Thank you, Mr. Chairman. I yield back the balance of my
    time.
        Mr. Pitts. The Chair thanks the gentleman.
        I now recognize the ranking member of the full committee,
    Mr. Pallone, 5 minutes for an opening statement.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you, Mr. Chairman. I want to also thank
    Dr. Shuren and Dr. Conway for being here today to discuss the
    regulation of lab-developed tests.
        There has been a lot of discussion over how to
    appropriately oversee lab-developed tests, and it is important
    that, as the committee considers this issue, we have a better
    understanding of the strengths and limitations of both FDA and
    CMS's authority in this area.
        Congress gave FDA authority over lab-developed tests under
    the Medical Device Amendments in 1976, and at that time, most
    LDTs were relatively simple tests used more often for rare
    conditions. Since then, advances in technology and medicine
    have resulted in LDTs that are increasingly more complex, more
    readily available to physicians and patients, and used to
    diagnose and treat a wider range of diseases, including breast
    cancer and heart disease. LDTs are also increasingly used to
    provide personalized treatment such as through genetic tests
    that help physicians to detect the risk of certain diseases
    earlier or to choose more targeted therapies.
        Unfortunately, many of these tests have not been reviewed
    or cleared by FDA prior to coming to the market to confirm that
    these tests are accurate, reliable, or provide clinically
    accurate results. This can result in patients going undiagnosed
    with certain medical conditions or undergoing treatment that is
    not medically necessary.
        For example, tests have been developed to identify certain
    gene sequences that can help determine appropriate treatment
    for ovarian cancer. I am sure many Members here are familiar
    with the example of OvaSure, which claimed to detect early-
    stage ovarian cancer in high-risk women. This test, though, was
    not properly validated and was found to provide high numbers of
    false positive and false negative results, and this means many
    women who received a false positive result may have undergone
    unnecessary surgery to remove healthy ovaries, or some women
    may have gone undiagnosed after receiving a false-negative
    result.
        Patients deserve to know that the test results they are
    relying on to diagnose or treat a condition is accurate, a
    comfort that they do not always have today. And as we have
    heard from many organizations, patients and their physicians
    should be able to trust the results of their tests, regardless
    of how or where a test is developed or performed. It does not
    make sense to regulate tests differently based on who develops
    them.
        I also believe that we can provide patients and providers
    with this certainty without endangering or inhibiting the
    medical innovation that is occurring today. Scientific progress
    has been made to help facilitate the development and use of
    personalized medicine, which you all agree is the future of
    medicine, but this development can only be successful if we
    know that these complex, sophisticated tests are clinically
    valid.
        So I am glad that today we will have the opportunity to
    better understand FDA and CMS's authority in this area and hear
    their perspective on what regulatory changes, if any, are
    needed to address the future development of lab-developed
    tests. And I hope moving forward that both agencies will work
    with the committee on the discussion draft circulated today to
    ensure that any legislation that moves forward will ensure that
    LDTs are accurate, reliable, and safe for patients.
        I yield back.
        [The prepared statement of Mr. Pallone follows:]

                 Prepared statement of Hon. Frank Pallone, Jr.

        Mr. Chairman, thank you for holding today's hearing. I also
    want to thank both Dr. Shuren and Dr. Conway for being here
    today to discuss the regulation of lab developed tests.
        There has been much discussion over how to appropriately
    oversee lab developed tests and it is important that as the
    Committee considers this issue, we have a better understanding
    of the strengths and limitations of both FDA and CMS's
    authority in this area.
        Congress gave FDA authority over lab-developed tests under
    the Medical Device Amendments in 1976. At that time, most LDTs
    were relatively simple tests used most often for rare
    conditions. Since then advances in technology and medicine have
    resulted in LDTs that are increasingly more complex, more
    readily available to physicians and patients, and used to
    diagnose and treat a wider range of diseases, including breast
    cancer and heart disease. LDTs are also increasingly used to
    provide personalized treatments, such as through genetic tests
    that help physicians to detect the risk of certain diseases
    earlier or to choose more targeted therapies.
        Unfortunately, many of these tests have not been reviewed
    or cleared by FDA prior to coming to the market to confirm that
    these tests are accurate, reliable, or provide clinically
    accurate results. This can result in patients going undiagnosed
    with certain medical conditions, or undergoing treatment that
    is not medically necessary.
        For example, tests have been developed to identify certain
    gene sequences that can help determine appropriate treatment
    for ovarian cancer. I am sure many Members here are familiar
    with the example of OvaSure, which claimed to detect early
    stage ovarian cancer in high-risk women. This test though was
    not properly validated and was found to provide high numbers of
    false-positive and false-negative results. This means many
    women who received a false positive result may have undergone
    unnecessary surgery to remove healthy ovaries, or some women
    may have gone undiagnosed after receiving a false negative
    result.
        Patients deserve to know that the test results they are
    relying on to diagnose or treat a condition is accurate, a
    comfort that they do not always have today. As we have heard
    from many organizations, patients and their physicians should
    be able to trust the results of their tests regardless of how
    or where a test is developed or performed. It does not make
    sense to regulate tests differently based on who develops them.
        I also believe that we can provide patients and providers
    with this certainty without endangering or inhibiting the
    medical innovation that is occurring today. Scientific progress
    has been made to help facilitate the development and use of
    personalized medicine, which we all agree is the future of
    medicine. But this development can only be successful if we
    know that these complex, sophisticated tests are clinically
    valid.
        I am glad that today we will have the opportunity to better
    understand FDA and CMS's authority in this area and hear their
    perspective on what regulatory changes, if any, are needed to
    address the future development of lab-developed tests. I hope
    moving forward that both agencies will work with the Committee
    on the discussion draft circulated today to ensure that any
    legislation that moves forward will ensure that LDTs are
    accurate, reliable, and safe for patient use.
        I yield back.

        Mr. Pitts. The Chair thanks the gentleman.
        As usual, all the written opening statements of the Members
    will be made part of the record.
        That concludes the opening statements.
        I would like to submit under U.C. request the following
    documents for the record: a November 16 letter from a number of
    organizations and laboratory directors, and a November 11
    letter from organizations representing patients, advocates,
    caregivers, and healthcare professionals.
        Without objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Pitts. On our panel today we have two witnesses, and I
    welcome them, thank them for coming. First, Dr. Jeffrey Shuren,
    Director, Centers for Devices and Radiological Health, Food and
    Drug Administration, Department of Health and Human Services;
    and Dr. Patrick Conway, Deputy Administrator for Innovation and
    Quality, and Chief Medical Officer, Office of the
    Administrator, Centers for Medicare and Medicaid Services,
    Department of Health and Human Services.
        Thank you for coming. Your written testimony will be made
    part of the record. You will each be given 5 minutes to
    summarize.
        Dr. Shuren, you are recognized for 5 minutes for a summary.

       STATEMENTS OF JEFFREY SHUREN, M.D., DIRECTOR, CENTER FOR
    DEVICES AND RADIOLOGICAL HEALTH, FOOD AND DRUG ADMINISTRATION,
     DEPARTMENT OF HEALTH AND HUMAN SERVICES, AND PATRICK CONWAY,
          M.D, ACTING PRINCIPAL DEPUTY ADMINISTRATOR, DEPUTY
      ADMINISTRATOR FOR INNOVATION AND QUALITY, AND CHIEF MEDICAL
    OFFICER, CENTERS FOR MEDICARE AND MEDICAID SERVICES, DEPARTMENT
                      OF HEALTH AND HUMAN SERVICES

                      STATEMENT OF JEFFREY SHUREN

        Dr. Shuren. Well, thank you, Chairman Pitts, Ranking Member
    Green, members of the subcommittee. Thank you for the
    opportunity to testify today.
        We are excited about scientific developments in genomics
    and molecular biology that are leading to advances in health
    care, particularly in precision medicine. Getting the right
    treatment to the right patient at the right time, though,
    depends upon having accurate, reliable, and clinically valid
    tests. If not, we give the wrong treatment or we give no
    treatment, and patients get hurt.
        FDA has been regulating in vitro diagnostics for almost 4
    decades, and when such a test is made by a laboratory, we call
    it a laboratory-developed test, or LDT. And the law doesn't
    distinguish on who makes it. We regulate the test regardless of
    who makes that test. And we ensure that those tests are
    analytically and clinically valid.
        Now, when we first started regulating IVDs, as a matter of
    policy, we decided not to actively enforce existing
    requirements on LDTs because at the time they were generally
    simple, low-risk tests used on uncommon conditions in often a
    local setting, typically in a hospital for patients in that
    hospital. But over time they have come increasingly more
    complex, higher risk, they are used on common conditions like
    heart disease, and they may be offered on a national basis. In
    addition, we have been coming across increasing examples of
    problematic LDTs. We put out examples of 20 of them just
    yesterday, and there are others.
        As a result of this, the problems we have seen and the
    increasing complexity, there have been calls on the FDA to
    actively enforce existing requirements that started in the
    1990s, NIH and the Department of Energy. In the 2000s two
    advisory committees to the Secretary of Health and Human
    Services called on us to regulate. The Institute of Medicine
    has asked us to regulate.
        So in 2007 we put out draft policy to begin to actively
    regulate a subset of LDTs, and what the lab community said is
    don't pick off tests one by one. Please put in place an
    overarching framework. So in 2010 we had a public meeting to
    get input, and we were told put in place a risk-based phased-in
    approach.
        And then in response in October of last year we did just
    that. We put out draft policy to now put in place that
    framework. And what we heard from the lab community then, oh,
    no, there are no problems with LDTs. We don't need FDA
    oversight of anything, maybe a little beefing up on CLIA, but
    that is it.
        And now, just a few months ago, we started to see several
    proposals come out from the lab community that now, for the
    first time, acknowledge that LDTs must demonstrate that they
    are analytically valid and clinically valid, that they should
    be subject to premarket review, at least moderate- and high-
    risk tests, the some modifications need to be subject to
    premarket review, that certain problems need to be reported to
    the Government, and they need to be under a risk-based approach
    with a three-tier risk classification system. None of those are
    currently enforced on them today. They all exist under an FDA
    framework.
        But what most of these proposals except one would do is it
    would create a duplicative program under CMS and a bifurcated
    system, leading to more inefficiencies, higher costs, and still
    putting patients unnecessarily at risk. For example, you can
    have a conventional manufacturer who makes an IVD we regulated.
    Now, a laboratory makes a big enough change to it, which
    laboratories do, and it is regulated by CLIA. Then the original
    manufacturer makes a change to that test and it bounces back to
    the FDA. So we will be stuck in a game of regulatory ping-pong,
    and the real loser here is patients.
        Doctors and patients don't care about who makes a test.
    They do care that their tests are accurate, reliable, and
    clinically valid.
        Now, some labs have already been working with us, and we
    congratulate them for crossing that picket line. But our
    message in our invitation to the rest of the lab community is
    to put down the swords, that for the sake of our patients it is
    time to end the saber-rattling and instead partner with us
    moving forward.
        Thank you.
        [The prepared statement of Dr. Shuren follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Pitts. The Chair thanks the gentleman, now recognizes
    Dr. Conway, 5 minutes for his summary.

                      STATEMENT OF PATRICK CONWAY

        Dr. Conway. Thank you, Chairman Pitts, Ranking Member
    Green, and members of the committee. Thank you for the
    opportunity to talk about our work at the Centers for Medicare
    and Medicaid Services related to ensuring accurate and reliable
    laboratory testing.
        The Clinical Laboratory Improvement Amendments of 1988,
    commonly referred to as CLIA, of which CMS has primary
    jurisdiction, created minimum standards of quality for all
    clinical laboratories in the United States. CLIA successfully
    worked for approximately 25 years and has contributed to major
    improvements in the quality of clinical laboratories, promoted
    accurate testing, and improved patient safety.
        As of July of 2015 there were roughly 250,000 laboratories
    that have registered with CMS and held CLIA certificates. CLIA
    responsibilities are divided between three agencies: CMS; the
    Centers for Disease Control, or CDC; and the Food and Drug
    Administration. CMS conducts laboratory inspections to make
    sure that laboratories have appropriate controls, expertise,
    training, and procedures to ensure that tests are accurate and
    reliable. CMS also approves accreditation organizations and
    manages the laboratory certification process. CDC conducts
    laboratory quality improvement studies that guide policy
    determination and development of laboratory practice
    guidelines.
        FDA's primary responsibility under CLIA is to classify
    clinical tests into one of three categories--waived, moderate
    complexity, and high complexity--based on their level of
    complexity and risk to patients. FDA also has a critical role
    in determining clinical validity of tests and premarket
    evaluation. Standards that laboratories must meet under CLIA
    are based on the complexity of the tests they perform.
    Laboratories that perform more complex must meet higher
    standards.
        Laboratories that perform moderate- and high-complexity
    tests must meet requirements on quality assessment, quality
    control, personnel qualifications and education, general
    laboratory systems, and proficiency testing, among others.
    Laboratories that only perform waived tests, simpler tests that
    pose a low risk to patients, are exempt from most CLIA
    requirements. In addition, laboratories performing the same
    tests must meet the same standards, whether located in a
    hospital, doctor's office, or other site.
        This framework is designed to reduce the risk of potential
    harm and ensure patients receive the same high-quality clinical
    laboratory testing no matter where the test is performed.
        CLIA's provisions apply to all laboratories in the U.S.,
    not just those that receive Medicare payment in order to ensure
    uniform quality across all laboratories.
        CMS enforces CLIA standards by requiring laboratories to
    obtain certificates in order to operate. CMS conducts onsite
    surveys prior to issuing a certificate to a lab that performs
    high- or moderately complex tests. Labs are resurveyed every 2
    years, and the surveys also assist laboratories in improving
    patient care through education.
        Laboratories may also receive CLIA certification by
    obtaining accreditation from one of the seven private nonprofit
    accreditation organizations approved by CMS. To receive CMS
    approval, the accreditation organization requirements must meet
    or exceed CLIA's requirements.
        Moving forward, we believe CLIA and our implementing
    regulations create the necessary framework to effectively
    oversee laboratories day-to-day operations and into the future,
    including those operations that pertain to the use of
    laboratory-developed tests and other high-complexity tests. We
    have several principles that have helped guide our work in
    CLIA, which may also be useful when informing future efforts of
    this committee.
        First, we aim to prevent duplicative oversight efforts
    across agencies. CLIA requires coordination across CMS, FDA,
    and CDC. We have worked to ensure our oversight efforts are
    consistent and complementary and not duplicative. In doing so,
    we have ensured that we take advantage of the unique expertise
    of each agency and its staff.
        Second, we focus on our agency's oversight strengths. When
    CLIA was implemented in the early 1990s, the responsibility to
    conduct certifications of laboratories was a natural fit for
    CMS because of our survey and certification experience. On the
    other hand, CMS does not have scientific staff capable of
    reviewing complex medical and scientific literature in
    determining clinical validity. This expertise resides within
    the FDA, which assesses clinical validity in the context of
    premarket reviews and other activities aligned with their
    regulatory efforts under the Food, Drug, and Cosmetic Act.
        Third, we value our relationship with our private
    accreditor organizations and State-based partners. These
    organizations play an important role in evaluating and
    certifying laboratories.
        Fourth, we take targeted, risk-based approaches to
    oversight to improve patient safety without creating burdensome
    administrative requirements. We believe the current approach in
    which laboratories must meet higher standards if they are to
    perform more complex tests has paid dividends in improving the
    quality of the testing process.
        Finally, as a practicing physician who works clinically on
    weekends, I know the importance of tests being assessed for
    clinical validity, as well as the need for assessment for
    laboratory standards. FDA and CMS can work together utilizing
    their respective authorities and strengths to assess premarket
    clinical validity and laboratory standards respectively.
        Thank you again for the opportunity to discuss CMS's work
    related to ensuring accurate and reliable laboratory testing. I
    look forward to your questions. Thank you.
        [The prepared statement of Dr. Conway follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Pitts. The Chair thanks the gentleman, both witnesses
    for your opening statements. I will begin the questioning. I
    will recognize myself 5 minutes for that purpose.
        The discussion draft, which the committee circulated before
    the hearing, divides FDA and CMS responsibilities based upon
    the type of activity being conducted by the regulated entity.
    FDA would regulate test development activities in a risk-based
    manner, and CMS would regulate lab operations.
        Unlike the discussion draft, some alternative proposals
    being floated would divide regulatory oversight between CMS and
    FDA depending on the type of test.
        I would like each of you to respond. Dr. Shuren, would you
    comment on the implications of an approach that would divide
    oversight between CMS and FDA based on the type of test, as
    opposed to the type of activity?
        Dr. Shuren. So such a system is going to lead to
    inefficiencies. It is going to lead to inconsistent standards,
    treating the same kind of test differently depending upon who
    makes the test. And as a result, you can go to one institution,
    get a test, and it is regulated by FDA. You can get the same
    kind of test across the street and it is regulated by CMS. And
    the people who are put at risk, it is patients.
        If we are going to assure that tests work, we need one
    unified system that we are applying consistent standards and we
    are assuring that those tests are accurate, reliable, and
    clinically valid.
        Mr. Pitts. Dr. Conway, would you comment on that, the
    implications of an approach that divides oversight between CMS
    and FDA based on the type of test, as opposed to the type of
    activity?
        Dr. Conway. Yes, I agree with Dr. Shuren. The concern here
    is we want to reduce and avoid duplication and ensure
    coordination across agencies. You know, from a CLIA construct
    we really are focused on post-market review, laboratory by
    laboratory, and we are really focused on the things such as the
    protocols in place in the laboratory, the equipment and
    equipment maintenance, the training of staff and personnel. So
    CLIA's focus really is on that laboratory-by-laboratory
    assessment of quality standards.
        Mr. Pitts. And expand a little bit more on whether such an
    approach would create administrative duplication or any
    inconsistencies, Dr. Shuren?
        Dr. Shuren. That is correct. It will create inefficiencies
    and higher costs because essentially we have duplicative
    systems in FDA and CMS, and the real distinction is just simply
    who makes the test, which doesn't make sense. And we will have
    inconsistent standards. We can try to coordinate between
    ourselves, but quite frankly, that becomes much more
    challenging as tests also begin to bounce between FDA oversight
    and CMS oversight.
        Mr. Pitts. OK. Dr. Conway, you stated in your testimony
    that ``CMS does not have a scientific staff capable of
    determining whether a test is difficult to successfully carry
    out or likely to prove detrimental to a patient if carried out
    improperly. This expertise resides within the FDA.'' From your
    perspective at CMS, what would be the impact on patients if FDA
    were precluded from reviewing the clinical validity of most
    LDTs?
        Dr. Conway. Yes. So as Dr. Shuren mentioned, I think the
    challenge is if FDA is not reviewing the test in a premarket
    manner for clinical validity, then our surveyors in CLIA are
    not assessing clinical validity. They are assessing laboratory
    practices and the protocols and standards in those
    laboratories. So as a practicing physician, it is critical, as
    Dr. Shuren said, that we know that a test is clinically valid,
    meaning it is truly detecting the presence or absence of
    disease. Therefore, the premarket review by FDA is important.
        Mr. Pitts. Now, some stakeholders have said that CMS should
    be tasked with reviewing tests for clinical validity. What are
    your thoughts on that approach?
        Dr. Conway. So our survey staff are not trained to assess
    clinical validity, and then let me build on that. Our survey
    staff are trained in laboratory protocols, equipment, standards
    around those protocols, whereas--and Dr. Shuren can certainly
    speak directly to FDA's staff--is, you know, physicians,
    Ph.D.'s, biostatisticians who are trained in assessing the
    scientific literature in its entirety and assessing clinical
    validity.
        Mr. Pitts. Now, some stakeholders have suggested that CMS
    should regulate tests developed by labs. FDA should regulate
    tests developed by manufacturers. Some have proposed carving
    out a role for FDA only when a test developer chooses not to
    publicize their methodologies. Shouldn't the test's impact on
    the patient, regardless of who developed it, be the primary
    factor in developing a regulatory framework? Dr. Shuren and
    then Dr. Conway.
        Dr. Shuren. Well, we agree that this should be a risk-based
    framework. We also think that you should have one agency that
    is reviewing those tests to assure that they are accurate,
    reliable, and clinically valid. That assures consistency.
        But also, one of the things we have found is when someone
    makes a test, another lab or another entity makes a similar
    test, we learn from that, and we sometimes identify problems or
    common problems and we are able to feed that back to test
    developers. If you split it between two agencies, we are going
    to lose all that learning that ultimately benefits innovation
    and benefits patients.
        Mr. Pitts. Dr. Conway, do you want to comment?
        Dr. Conway. So I agree with Dr. Shuren. I believe one
    agency doing the premarket review, as Dr. Shuren said, and that
    agency being FDA, makes sense given the training and expertise.
    We also, as you have heard, have a principle of coordination
    and using each agency's expertise. CMS's focus and expertise is
    in the area of laboratory assessment, laboratory by laboratory,
    on protocols, equipment, et cetera.
        Mr. Pitts. My time is expired. The Chair recognizes the
    ranking member, Mr. Green, 5 minutes for questions.
        Mr. Green. Thank you, Mr. Chairman.
        I would like to ask unanimous consent to submit a letter
    from the American Cancer Society Cancer Action Network for the
    record.
        Mr. Pitts. Without objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Green. Dr. Shuren, with other medical devices, FDA has
    proposed regulating lab-developed tests based on the risk of
    the test to the patient and the public. Under proposed FDA
    would classify LDTs into three risk classes: low, moderate, and
    high. Can you explain how FDA proposes to finding the low,
    moderate, and high risk in the agency's framework describing
    how premarket or post-market requirements would vary among
    these risk classes?
        Dr. Shuren. So we look at risk based upon what the risk is
    to patients if that test provides a false result, an incorrect
    result. And we estimate that for low-risk tests we do not
    conduct premarket review because they are so low risk. We think
    about 50 percent of the tests out there--that has been our
    experience--are low risk. And then we conduct premarket review
    for high-risk and moderate-risk tests. High-risk tests are only
    about 1 to 2 percent of the tests out there, moderate risk
    about 48 percent.
        And the data needed to demonstrate analytical and clinical
    validity differs depending upon the risk of the disease. There
    is less burden involved when it is a less-riskier test rather
    that we are reviewing, and that is the risk-based approach that
    we apply.
        Mr. Green. FDA's approval standard for drugs and medical
    devices safe and effective, can you just please discuss the
    approval standard FDA has proposed using for the regulation of
    lab-developed tests?
        Dr. Shuren. So we would apply the same standard we would
    apply to in vitro diagnostic tests that are not made by a lab,
    that they are analytically valid, they are clinically valid,
    and they are safe to use under their conditions to use. That
    means they are accurate on what they measure, they are
    reliable, and they will identify they in fact do identify a
    disease.
        Mr. Green. Companion diagnostics is an area of great
    interest and enthusiasm. Can you talk about how the FDA views
    this category of tests, in particular the level of risk posed
    to patients and how they would be treated under the proposed
    guidance?
        Dr. Shuren. So companion diagnostics are increasingly
    playing a bigger role in health care. Essentially, companion
    diagnostic is a test where the safety and effectiveness of the
    therapeutic depends upon the diagnostic because the diagnostic
    informs whether or not that patient should receive a particular
    treatment. And that is why it is critically important that
    those tests truly work, because if not, then patients are not
    getting the right treatment or they may be getting no treatment
    at all.
        For example, we had a test for providing treatment for
    women with breast cancer and found that LDTs in the past were
    producing as much as 20 percent of them incorrect or inaccurate
    results. That means that women who should have gotten treated
    with the right treatment were not. And that is preventable.
        Mr. Green. OK. Thank you. Dr. Conway, I want to thank you
    also for participating. As you are aware, following the release
    of the FDA's guidance on enforcing requirements for lab-
    developed tests, a number of stakeholders called for
    enhancement of CLIA as a more appropriate way to regulate the
    tests. And I appreciate your testimony on outlining the
    difference between FDA and CMS authority over the tests.
        One of the key differences is the fact that under CLIA CMS
    does not review a test for the clinical validity, that is,
    accuracy on which the test identifies measures or predicts the
    presence and absence of a clinical condition or predisposition
    to a patient. Rather, CMS reviews look at analytical validity.
    You noted that the experience and expertise in assessed
    clinical validity resides instead with the FDA.
        Despite CMS stating on more than one occasion that the
    agency does not have the experience or the scientific expertise
    to assess clinical validity in premarket review, many
    stakeholders continue to advocate for additional authority in
    that area for CMS. Can you please discuss further CMS
    capabilities in implementing regulations for overseeing LDTs,
    and can you also please comment on whether CMS would have the
    capability of conducting any type of premarket review or
    regulatory review of LDTs?
        Dr. Conway. Yes. So our framework that we believe is
    working well now is CLIA is focused on assessment of the
    protocols, the standards, the equipment, the training, and the
    personnel. Even in analytic validity, we are simply looking at,
    you know, does the lab test detect the analyte described? That
    is very different than clinical validity, which is assessing
    whether, you know, the test reliably and accurately detects the
    presence or absence of disease, as Dr. Shuren said.
        You know, the majority of our staff are--you know, we have
    got approximately 25 people in the central office running CLIA,
    a little over 100 surveyors across the States, all of the
    States. They are generally medical technologists, former
    laboratory personnel trained to assess laboratory by
    laboratory. They are not trained to assess premarket scientific
    literature and determine clinical validity.
        Mr. Green. OK. Thank you, Mr. Chairman.
        Mr. Pitts. The Chair thanks the gentleman and now
    recognizes the vice chair of the full committee, Mrs.
    Blackburn, 5 minutes for an opening statement.
        Mrs. Blackburn. Thank you, Mr. Chairman.
        Dr. Shuren, looking at the LDT guidance, do you plan to
    finalize that guidance that you issued last year? Do you plan
    to finalize that this year?
        Dr. Shuren. Yes, we do plan to finalize that.
         Mrs. Blackburn. OK. When?
        Dr. Shuren. In 2016.
        Mrs. Blackburn. OK. So basically you are going to put it
    off another year?
        Dr. Shuren. I don't get to determine when, but the plan is
    to put it out in 2016.
        Mrs. Blackburn. In 2016. Early or late?
        Dr. Shuren. Hopefully earlier than later.
        Mrs. Blackburn. OK.
        Dr. Shuren. I wish I could give you an answer. Again, it is
    so far above my pay grade. I don't even know the people who
    make the decisions.
        Mrs. Blackburn. Well, my goodness, we need to have a meet-
    and-greet over at the FDA and see if we can't get some wheels
    turning over there. We should help with that.
        Let me ask you this. As you finalize that guidance, do you
    intend to use what I think is the outdated 1970s definition of
    a medical device in order to regulate the LDTs?
        Dr. Shuren. Well, so that definition also includes a
    distinct definition for in vitro diagnostics, which then
    incorporates laboratory-developed tests. It does not
    distinguish who makes the tests.
        Mrs. Blackburn. OK. Let me ask you this. Each improvement
    in an LDT technology or an upgrade or an update, will that need
    to go back through the medical device approval process?
        Dr. Shuren. No. Most modifications to tests are not
    reviewed by FDA. We only focus on those that have the really
    big impact, yes.
        Mrs. Blackburn. OK. Do you intend to add to the rapid
    growth of healthcare costs by taxing LDTs as medical devices in
    addition to charging the innovators the user fee?
        Dr. Shuren. So we are not responsible for administrating
    the device tax. That is IRS. We have nothing to do with it.
         That said, one of the reasons we put in place that
    laboratories could notify us about their tests as opposed to
    registering and listing was that it would not trigger the
    device tax.
        Mrs. Blackburn. I think your guidance informs the IRS,
    though, is that not correct?
        Dr. Shuren. No, the IRS would look separately to if that
    device has listed.
        Mrs. Blackburn. OK. I want to thank you for the report that
    you sent to the Congress last night. It was an interesting
    read. And what I found most interesting about it was what was
    left out and that you didn't discuss the FDA front-end process,
    which deserves some attention and some discussion, specifically
    the PREDICT program. Twenty-eleven this was put in place. It is
    a compliance program. It is an artificial intelligence program
    that is supposed to identify high-risk shipments at our ports
    of entry. And the problem with PREDICT is that it is
    significantly delaying the shipment of needed medicine and
    medical supplies. Medical shipments are often sent by express
    service to get them to patients in time for critical usage. And
    once a shipment is held up by PREDICT, almost all of them are
    subsequently released without any physical inspection.
        So when you look at it from the outside, Dr. Shuren, what
    it appears to be and the impression is that the bureaucracy of
    the FDA is keeping medicines and medical supplies from patients
    because of concerns that there may have been contamination in
    some cilantro that was in the very same shipment. And I would
    really like to see the FDA spend the effort to fix this before
    they try to regulate another area of commerce.
        I noticed in that report also that it is based on 20 case
    studies. And how often does the FDA use case studies as
    sufficient evidence to approve or deny a medical therapy?
        Dr. Shuren. So in terms of approval, we don't tend to rely
    on an example. We have used a series of case studies as part of
    support for valid scientific evidence as we have approved
    certain tests or other products.
        I will note one thing about the cases, too, we put out
    yesterday. One of the challenges is that we don't have post-
    market surveillance in place for laboratory-developed tests as
    we do for tests made by other manufacturers. And as a result,
    it is very hard to identify when problems arise. And yet we
    know on the IVD side, when made by conventional manufacturers,
    we do detect problems, the manufacturers detect problems, and
    they fix them because that is in place.
        One of the other features in the FDA system is the post-
    market surveillance to identify problems and to fix problems,
    and that is just as important as premarket review to prevent
    faulty tests from getting on the market in the first place.
        Mrs. Blackburn. Well, as I yield back my time, I hope that
    you will fix PREDICT. I yield back.
        Mr. Pitts. The Chair thanks the gentlelady and now
    recognizes the gentlelady from California, Mrs. Capps, 5
    minutes for questions.
        Mrs. Capps. Thank you both, each of you, for your
    testimony, and thank you, Mr. Chairman, for putting together
    this hearing. I appreciate the opportunity to further discuss
    the strengths and challenges, have a real conversation about
    laboratory-developed tests as they guide medical decision-
    making by patients and providers. There are a lot of question
    marks and a lot of concern about where do we go from here, how
    do we dovetail these two agencies and giving the best outcome
    the patients.
        I recognize there are many perspectives in this space. I
    appreciate this conversation to try to illuminate some of the
    issues. Over the years, it goes without saying these tests have
    come more tailored and more elaborate, and this conversation is
    important to ensure that these tests do produce meaningful and
    reliable results for those who trust them.
        Dr. Conway, I will turn to you first. In your testimony you
    note that there are six key performance specification
    assessments for lab-developed tests: accuracy, precision,
    reference range, reportable range, analytic sensitivity,
    analytic specificity. This committee has heard a lot about how
    different research institutions are driving the future of
    medicine toward more personalized medicine. This has been
    particularly true in the field of cancer where the development
    of multi-gene panels is being used to identify important
    molecular characteristics of a tumor.
        And my question to you is whether the current CLIA
    regulations ensure these gene panels developed by different
    institutions or manufacturers will produce the same results?
    For example, if I am a patient and I am tested with hospital
    A's gene panel, how do I know I would get the same result if I
    am tested with hospital B's gene panel? Would each hospital
    reach the same treatment decision, and where does this lead us?
        Dr. Conway. Yes, you have highlighted--thank you for the
    question, and you have highlighted one of the challenges. And
    Dr. Shuren could certainly speak more.
        You know, our assessment of analytic validity is laboratory
    by laboratory where we are looking at the areas you described
    and the laboratory director's documentation, that they are
    following a protocol to detect the appropriate analyte.
        And you highlighted a great example, genetic testing. It is
    not assessing whether different genetic testing kits or
    combination of tests are detecting the disease with the same
    clinical validity and rigor. So you could in fact in the
    current framework, without premarket assessment of clinical
    validity, have different tests giving different answers to
    clinicians that could drive treatment that is inappropriate,
    which is why we think the assessment of premarket clinical
    validity in this area is critical and important.
        Mrs. Capps. So that leads me to focus now with you, Dr.
    Shuren. Many have argued that there is no need for greater FDA
    oversight of lab-developed tests, as we have not had the same
    types of problems with LDTs as we have had with drugs such as
    the outbreak of adverse events associated with use of
    contaminated heparin, for example, or adverse events associated
    with contaminated compounded drugs. They assert that if there
    are greater health risks associated with LDTs, we would have
    heard about them.
        I am not sure you agree, but it is clear to me from the
    report that FDA released yesterday that lab-developed tests do
    present real risks to patients. Can you please explain whether
    or not you agree with this criticism that came out? Would
    healthcare providers and patients necessarily know if tests
    were not giving good advice for clinical decisions?
        Dr. Shuren. I don't agree with that criticism. And doctors
    and patients would not know who made the device and whether it
    is one that was approved by FDA or it was one that was not
    approved by FDA. Quite frankly, the reason you don't see as
    many problems, you don't have the systems in place to identify
    them. So, for example, for IVDs we regulate, in 2014 we had
    over 300 recalls. It is not unusual.
        Things change, problems arise, but you need the systems to
    identify the problems and to fix them. And we have some labs
    who have submitted their tests to us, and we have approved or
    cleared some LDTs. And when they put the systems in place,
    these started to identify problems. One of them has already had
    eight recalls, but they only found the problems because they
    put in the systems that they should have in place.
        Mrs. Capps. Well, now, how can patients--I am just about
    out of time, but how can patients, providers, and payers be
    assured that the tests they are paying for are providing real
    value and enhancing the care of patients?
        Dr. Shuren. Well, that is why we would like to have a
    uniform, consistent approach to diagnostic tests, regardless of
    who makes them. That information will be made available to the
    public so they know what tests have been approved. There is
    information about what those tests are for. The makers have to
    put out information that explains its performance
    characteristics, its intended use, how to use it properly, and
    all that will provide necessary information to doctors and
    patients so they can use those tests appropriately.
        Mrs. Capps. Thank you.
        Dr. Shuren. Right now, they can't.
        Mrs. Capps. OK. It sounds like we need a follow-up. I yield
    back.
        Mr. Pitts. The Chair thanks the gentlelady and now
    recognizes the chair emeritus of the full committee, Mr.
    Barton, 5 minutes for questions.
        Mr. Barton. Thank you, Mr. Chairman. I want to thank both
    our witnesses for attending today. I appreciate the
    subcommittee chairman, the full committee chairman issuing the
    proposal as a discussion draft, which to me means that their
    minds are still open and that we can make some changes and
    things of this sort.
        I am one of those skeptics that Mrs. Capps just talked
    about. I am not sure that we need to get more Federal
    regulation. I don't necessarily think more Federal regulation
    is going to give us a safer, more efficacious result.
        So I guess my first question to either of you gentlemen
    would be what is the real problem? I mean why in the world
    would a laboratory develop a test that wasn't safe and
    accurate? My office is not being overrun with phone calls or
    emails from doctors, patients, hospitals, advocacy groups that
    there is some terrible laboratory diagnostic test out in the
    marketplace.
        Dr. Shuren. But those tests are out on the marketplace. So,
    for example, a test was developed for something called KIV 6.
    It was supposed to predict the risk of heart disease and
    response to statin treatment. And the lab came out with it,
    promoted it, said they had studies, but then subsequently good
    studies were performed and in fact found that there was no
    association between KIV 6 and those conditions. And by the time
    it came out, though, over 150,000 people had the tests
    performed. We estimated the cost to our healthcare system was
    over $2 billion. That is not money we can afford to waste on
    bad testing.
        Mr. Barton. And what happened----
        Dr. Shuren. So what happened----
        Mr. Barton. I assume that test was taken off the market and
    without FDA having to do anything.
        Dr. Shuren. It remained on the market and there was
    continued use for a while and then use started to dip down. But
    is that really the system we want, that we have bad tests,
    people can get hurt by it, and then afterwards if you find the
    problem and you get on top of it, then something happens to the
    test? The whole point of premarket review is and why we do that
    for the other tests----
        Mr. Barton. You are going to guarantee if we would let your
    agency review all these diagnostic tests, the laboratory tests,
    that something like that will never happen again, that you all
    are perfect and all-knowing and you are going to do it in a
    cost-effective way and it will be peace and light from now
    until Judgment Day?
        Dr. Shuren. I will not promise you perfection, and I will
    leave it to God to decide if there will be peace on Earth,
    but----
        Mr. Barton. Well, I am glad to hear somebody use----
        Dr. Shuren. But that said, we have----
        Mr. Barton [continuing]. The Divinity's name in a positive
    way. That is----
        Dr. Shuren. Yes, well, they can fire me.
        Mr. Barton. That is a good thing.
        Dr. Shuren. But we have almost 40 years of experience of
    regulating in vitro diagnostic tests and assuring that those
    tests are accurate, reliable, and clinically----
        Mr. Barton. I mean, granting your point at least partially,
    wouldn't it be better to give FDA or some State regulatory
    agency--it doesn't necessarily have to be Federal--some sort of
    a penalty assessment that we can immediately put a stop if
    there is a bad test? Wouldn't that be a better use of your
    agency's resources? So to use your example, if that were to
    happen again, boom, we catch it, we stop it, we hit them with a
    big penalty and get that test off the market. I am not being a
    horse's rear on this, but, you know, if it is not broken, don't
    fix it, and it looks to me like we are just looking for ways to
    give the CMS and the FDA more authority. And it is obvious that
    Chairman Pitts and Chairman Upton and I assume Mr. Pallone and
    Mr. Green are concerned, too. But more regulation is not always
    the best answer.
        I guess my last question would be under the current system
    what role if any do the States play in looking at these tests?
        Dr. Shuren. So there are States--I can let Dr. Conway talk
    about it in terms of States that are involved in accreditation
    of laboratories, but they are not involved in premarket review
    for those tests with certain exceptions. New York State does do
    a review of tests. And quite frankly, under the proposal we
    have, we have the opportunity to leverage third parties. If New
    York State is meeting appropriate standards, we could leverage
    some of the work that they are doing.
        But I will tell you the problems are more prevalent than
    people want to recognize. You know, one of the medical centers
    at the University of Texas was concerned about this----
        Mr. Barton. I went to A&M so that doesn't scare me.
        Dr. Shuren. No, no, no--well--but I will tell you what they
    were finding is----
        Mr. Barton. I am going to hear it whether I want to or not.
        Dr. Shuren. That is right. Thank you for that. But there
    were inconsistencies in what they were seeing reported by labs
    for the same kind of tests, so what they did is they took
    results from 105 of their cancer patients and they had results
    from one laboratory, they sent it to a second laboratory, and
    of the 32 gene variants, they found 50 percent disagreement, 50
    percent. And so they even concluded that this suggests
    physician care would differ based on different interpretations
    of different companies. And this is not the only report out
    there, other ones reporting 27 percent finding of incorrect or
    inaccurate results. This is not uncommon. This goes on.
        It is fixable, and it shouldn't be fixed after the fact.
    Why should our people get hurt, and only when that happens--and
    if we can find it because we don't have the systems to do
    that--do we take action. Is that really the kind of health care
    we want to provide? Do we want to spend money on unnecessary
    care or do we want to spend it on innovation and assuring those
    tests work.
        Mr. Barton. Well, I am with you on the innovation part.
        Mr. Chairman, you know, the other subcommittee's got the
    FCC commissioners downstairs, so I am not going to be able to
    stay, but I appreciate you holding this hearing and thank you
    for the courtesy of the time.
        Mr. Pitts. The Chair thanks the gentleman and now
    recognizes the ranking member of the full committee, Mr.
    Pallone, 5 minutes for questions.
        Mr. Pallone. Thank you, Mr. Chairman.
        I wanted to ask Dr. Shuren. As you know, various
    stakeholders have been circulating legislative proposals
    regarding the regulation of lab-developed tests. Among these
    various legislative proposals, there seems to be a great deal
    of variance around moderate-risk tests. Some proposals have
    suggested that no premarket review is necessary for moderate-
    risk tests, and one proposal would require premarket review of
    moderate-risk tests but would allow such tests to be deemed
    approved if FDA did not act in a specified time frame.
        So I wanted to ask you a couple questions about this. In
    your testimony you noted an example of a test that is moderate
    risk would blood glucose strips used by people with diabetes
    and tests to help doctors diagnose heart failure. Could you
    discuss what FDA considers to be moderate risk and provide some
    examples of tests that would be considered moderate risk?
        Dr. Shuren. So other moderate-risk tests would be for
    diagnosing cystic fibrosis, herpes, heart failure are all
    moderate-risk tests----
        Mr. Pallone. OK.
        Dr. Shuren [continuing]. That we currently regulate.
        Mr. Pallone. Does the FDA believe that premarket review of
    moderate-risk tests that there should be, and if so, can you
    describe when you believe that premarket review of a moderate-
    risk test would be necessary?
        Dr. Shuren. So we do believe that most moderate-risk tests
    would be subject to premarket review. That is what we do now,
    but we do find that there are certain circumstances where we
    can put other mitigations in place that are good enough and you
    don't need premarket review. We just did that a little while
    back for next-generation sequencing platforms, when they are
    just making tool claims. We just did that for autosomal
    recessive carrier screening tests. And that is a natural course
    of action. As the science develops, technology evolves, we can
    actually change risk classification or what a test will have to
    do to come on the market. That is hallmarks of a risk-based
    approach.
        We are also very concerned about this deemed-approved
    approach. It essentially says if we don't make it decision in
    time, it is approved. So a test goes on the market that may be
    inaccurate simply because we didn't have enough time to finish
    up the review or, alternatively, we will not approve it to not
    let it go on the market. And yet if we had the time to work
    with the lab, we might get a good test on the market. Either
    way, bad tests on the market, good tests not going on a market,
    the loser is patients.
        Mr. Pallone. OK. I think you answered my next question,
    which would be, you know, the deemed approval if FDA does not
    act. But let me say, can you comment on whether or not--yes, I
    think you already talked about the deemed approved. So let me
    go to another question, Dr. Shuren.
        I understand that once the test is approved or cleared by
    FDA and enters the market, laboratories frequently modify the
    kits either to expand uses or to make improvements to the way
    the test is performed. And some stakeholders in the lab
    community have even suggested that manufacturers rely on
    laboratories to modify tests in order to expand the uses
    because it is too costly or burdensome to have a test approved
    for every use. So do you believe that modifications to LDTs
    should be subject to premarket requirements, and if so, what
    types of modifications would FDA want to look at before they
    are put in place?
        Dr. Shuren. So we think most changes that are made would
    not be subject to FDA review, and that is actually what occurs
    now for other IVDs. We would review those changes when there is
    a new intended use because it truly is a new test. Even CLIA
    have used that as a new test. Or if there is a big enough
    change that when a test is approved would determine what its
    performance specifications are, if now you make a change and it
    goes outside the performance specifications, we would review
    that as well.
        Mr. Pallone. OK.
        Dr. Shuren. But it is those kinds of changes.
        Mr. Pallone. Let me go back. There was other thing that I
    could have asked you about, these tests are deemed approved if
    FDA didn't act in a certain time frame. Can you explain whether
    or not you believe patients, physicians, or payers would know
    which tests were affirmatively cleared or approved by FDA
    versus tests that were deemed to be approved? Is there any way
    that they would know that?
        Dr. Shuren. No. I mean if the test is approved, the test is
    approved.
        Mr. Pallone. So that is one of the dangers if you will. In
    other words, you said before that you would be concerned that
    you might approve something that shouldn't be or not approve
    something that could be. But the secondary problem is that the
    user is not going to know.
        Dr. Shuren. That is exactly right.
        Mr. Pallone. All right. Thanks a lot.
        Mr. Guthrie [presiding]. Thank you. And the gentleman
    yields back. I now recognize myself for 5 minutes for
    questions.
        Dr. Shuren and Conway, what does premarket review mean in
    the context of lab-developed tests, or LDTs? And how important
    is it and who should be responsible for such reviews?
        Dr. Shuren. So our premarket review is to determine if the
    tests are analytically valid, clinically valid, and they are
    safe for use under their conditions for use. And it is
    important to conduct those reviews for moderate- and high-risk
    tests to make sure they work because doctors and patients rely
    on those tests to make well-informed healthcare decisions. If
    they get inaccurate results, they could make the wrong
    decisions and people get hurt as a result.
        Mr. Guthrie. Thank you. Dr. Conway?
        Dr. Conway. I agree with Dr. Shuren. And from the CLIA/CMS
    perspective, you know, we are really focused on laboratory-by-
    laboratory post-market review of those laboratory protocols,
    equipment, training of personnel, et cetera.
        Mr. Guthrie. OK. Thank you. And I have heard that the same
    type of diagnostic test that is commonly available as both an
    LDT and a manufacturer kit that can be purchased by a lab, and
    tests for melanoma are one example. In other words, I could go
    to hospital A where they have a lab that developed their own
    test or, by chance, I could go to hospital B, whose lab
    purchased a test from a manufacturer. Can either of you walk me
    through this scenario from a regulatory perspective? In the
    case of hospital A, is it true that neither FDA nor CMS will
    have reviewed that test for clinical validity?
        Dr. Shuren. That is true. The test across the street would
    have been reviewed, and therefore, doctors and patients have
    the confidence to be able to rely on it, and you don't know in
    the case of the other one that has been offered.
        Mr. Guthrie. OK. Same----
        Dr. Conway. Yes, same. And CMS, once again, would not
    review clinical validity as part of the CLIA process.
        Mr. Guthrie. OK. Doing the premarket review of these types
    of tests, could each of you describe the general education and
    professional background and expertise of your reviewers?
        Dr. Shuren. So our review, particularly for more complex
    tests, tends to be performed by a team of experts. They may
    include physicians, Ph.D. scientists, and statisticians that do
    a deep dive into the scientific data. We review the science to
    see if in fact and not only that test works but what it is
    claiming to do matches up with the science.
        Mr. Guthrie. Thank you. Dr. Conway?
        Dr. Conway. Our CLIA team does not include any medical
    officers or other personnel trained in detailed biostatistics
    or Ph.D.-level training. Our CLIA team is really focused on, as
    I mentioned, laboratory assessment on an accreditation and
    quality and survey and certification framework in a post-market
    manner laboratory by laboratory.
        Mr. Guthrie. Thanks. And, Dr. Shuren, you previously
    testified about challenges you face in hiring and retaining
    sufficient medical expertise. How would your ability to do so
    be impacted if CMS were required to have the same types of
    expertise regarding test design and development?
        Dr. Shuren. Well, first off, I want to thank the committee
    for trying to take actions in 21st Century Cures to help us to
    better be able to attract and retain high quality talent. And
    that is where the answer lies.
        Mr. Guthrie. So the competition if CMS is doing the same
    would be----
        Dr. Shuren. Well, it makes no sense for competition, so all
    we are going to do is create a duplicative system in another
    agency. I mean it is interesting that people have raised
    concern about do not have duplicative regulatory frameworks in
    place, and yet some of the proposals we have seen now to put
    this under CLIA would do exactly that. It would create all this
    duplication the right now, as you have heard from both of us,
    doesn't exist.
        Mr. Guthrie. All right. Thank you. And I yield back the
    balance of my time.
        And I now recognize Ms. Castor from Florida.
        Ms. Castor. Thank you, Mr. Chairman. And thank you both for
    being here today.
        As we continue to develop a greater understanding of the
    genetics of individuals who have a wide variety of diseases and
    conditions, we are moving away from one-size-fits-all medicine
    to more targeted and effective prevention strategies and
    treatments and even cures. This is known as personalized
    medicine, and I believe it is fundamental to the vision of 21st
    Century Cures and holds great promise.
        This vision, though, will in large part be dependent upon
    accurate genetic tests, so it is imperative that these tests
    are scientifically credible. Dr. Shuren, can you provide some
    examples of the types of genetic tests that are being developed
    to help deliver personalized treatment? And describe in greater
    detail the role that these tests play in precision medicine.
        Dr. Shuren. So increasingly, we are seeing genetic tests
    being developed to help identify what the appropriate treatment
    may be for patients who have various conditions, including
    cancer. And it is critically important that those tests work,
    because if not, people are not getting the right treatment or
    they are not getting treatment when in fact they should get
    treatment.
        I will say that as we approach this, though, Government can
    be innovative. Increasingly, we are seeing next-generation
    sequencing tests being used, and last December, we put out a
    proposal for a new approach on next-generation sequencing that,
    rather than your standard model of maybe doing a clinical study
    is to leverage data in existing curated databases, which can
    allow for the clinical community to crowd-source the evidence,
    and as the science ultimately evolves to where it needs to be
    to be able to make claims about the use of that test. That way,
    the regulatory framework can stay step-in-step with the
    evolution of the science.
        In fact, we just held a two-day public meeting last week on
    this. There is a lot of support for moving forward with this
    approach. We have even relied on those curated databases to
    approve a test for cystic fibrosis.
        So that is where we need to focus our attention, and that
    is why we want the lab community at the table with us. Let's
    focus on the science. That is what we need to do. We have the
    regulatory tools. It is the science we have got to work
    together on. And we can do it if people are willing to work
    with us.
        Ms. Castor. Yes. And during our 21st Century Cures hearings
    and briefings, there was a lot of talk about data-sharing. What
    is going on--because we can't wait for Congress to act,
    frankly. What is going on with FDA and NIH and a lot of those
    research institutions across the country in being able to look
    at that data, share it, so we can develop the cures and
    treatments of the future?
        Dr. Shuren. Yes. So NIH has its own database of genetic
    variants. They do an assessment. We have other databases out
    there. We are now trying to work with these various groups on
    what the appropriate standards should be for the quality check
    for the curation and what should be the standards for clinical
    validity when you are evaluating that science.
        Also, we at the FDA have been developing a platform called
    precision FDA that would allow these test developers to
    essentially either share their genetic data to compare or
    providing analytical tools so they can test-drive some of these
    next-generation sequencing technologies to see if they are
    accurately sequencing the genome. We think this is a great
    role, if you will, to provide these common goods to all
    developers.
        Ms. Castor. Great. I do, too. Thank you. And I yield back
    my time.
        Mr. Guthrie. Thank you very much. The gentleman from
    Illinois, Mr. Shimkus, is recognized for 5 minutes.
        Mr. Shimkus. Thank you, Mr. Chairman. And welcome.
        Actually, I appreciate the comments from my colleague from
    Florida. That is kind of where I was just heading to a little
    bit, too, with the personalized medicine and the genetic
    testing and really being accurate on that test so then you can,
    as we talked about in the other piece of legislation, target
    based upon the genetic code or the individual patient. That is
    very exciting.
        And the other thing I think we have followed through the
    hearings and the 21st Century Cures is that then you just don't
    go down the route of prescribing remedial health action to
    someone without really full information, so the high cost of
    health care because you try this, didn't work, try this, didn't
    work, now you are trying this, and you can get more specific
    information. So it is very exciting times. And I think people
    were going around the same issues.
        But I wanted to ask this, and it is probably something I
    should know if I would have more thoroughly read my briefings,
    but when we talk about risk--basic, moderate, or high--so we
    are really focusing on moderate and high risk of the tests.
    What is the risk component? Is the risk component the risk of
    conducting it, the risk of not having accurate information, or
    the risk to the patient who hopes to get good information from
    a test because of the healthcare environment they presently
    find themselves in? So can you both talk on how do we define
    risk?
        Dr. Shuren. Yes. So the key consideration is the risk to
    the patient if they are getting an inaccurate result, they are
    getting a wrong result, and that is within the context of what
    would otherwise happen to that patient in clinical care. That
    is the way we look at it.
        Mr. Shimkus. So when you use the example of heart, you put
    that in a moderate--when you were giving the examples of--and I
    was kind of surprised. I mean, heart disease or heart issues, I
    think people would find it pretty risky if you have got heart
    disease, a higher risk than just in the moderate category. So
    there is some subjectivity to this or----
        Dr. Shuren. Well, so when we look at it, you put it within
    the clinical context. So in the case of heart failure, when you
    are making, you know, a diagnosis, there are other things that
    the clinician takes into account in making that determination.
    That is a little bit different, though, when I am dealing with
    something, let's say, like HIV where not only am I dealing with
    a high-risk condition, right, the risk to the patient is huge,
    secondly, I don't have another great means of truly determining
    is that HIV. And then there is also the risk of if I am wrong
    about this and that person goes out and doesn't know they have
    HIV, they may engage in activities that they will spread the
    disease. So we are really looking at it in the practical
    context of what in fact happens to the patient, not just simply
    the condition itself.
        Mr. Shimkus. Right. And I think this is a tough area for
    conservative Republicans who think Government is too big, costs
    too much, but there is obviously a position of we want to make
    sure that people are advertising and using tests, that they are
    given some stamp of approval, that they meet the requirements
    and the desires of what they are.
        So, Dr. Conway, real quick, you admit that the volume and
    complexity of these tests have kind of grown, I don't know, I
    would say exponentially almost. Would you agree with that?
        Dr. Conway. Yes. We don't have exact numbers for some of
    the reasons described, but it seems exponential.
        Mr. Shimkus. But you haven't asked for new authorities
    because of this growth, have you?
        Dr. Conway. So CMS has not put forward additional requests
    for statutory authority. As I mentioned, we think FDA can play
    a critical role in the premarket review, and we can play a
    critical role laboratory by laboratory, post-market.
        Mr. Shimkus. Yes, in your area do you require an individual
    review of the area that you have been involved with? Is there
    an independent review process of decisions that you are making,
    you know, in the CLIA process?
        Dr. Conway. Let me try to answer that. So I think we have a
    central office that has oversight of State surveyors, and
    therefore, oversight of the processes of those State surveyors.
    We also oversee accrediting organizations, of which there are
    seven. They have to meet or exceed CLIA standards, and we
    review that, including if any----
        Mr. Shimkus. But you are almost evaluating the
    organizations. The organizations aren't evaluating the
    independent decisions?
        Dr. Conway. We have bidirectional communication both with
    the States and their accrediting organizations like in any of
    our accrediting organizations, including at times in various
    programs accrediting organizations identify regulations or
    standards that need updating.
        Mr. Shimkus. Great. Thank you very much. I yield back my
    time.
        Mr. Guthrie. I thank the gentleman. The time is expired.
        And I recognize Dr. Schrader from Oregon for 5 minutes for
    questions.
        Mr. Schrader. Thank you, Mr. Chairman. And I would like to
    thank Dr. Shuren and Dr. Conway for being here. Interesting
    topic. I would hope that the chair or vice chair and ranking
    member would hopefully have us have an opportunity to talk to
    the stakeholders, including the physician groups, just to get a
    balanced perspective here. This is pretty darn important if we
    are going to go down this road, and I think the tender of the
    questions so far indicate that.
        And I appreciate the fact both of you testified in total
    agreement in pretty clear terms about how you guys have two
    different jobs in the different agencies. It is tough from a
    practitioner's standpoint, being part of the medical community,
    to really understand why that has to be. I understand it is
    right now, but I am not sure why it has to be. It seems odd to
    me that the Center for Medicare Services--medical services
    would not have some sort of health regulatory role or clinical
    analyzation capability.
        And it seems to me both of you are going to have to staff
    up, well, particularly FDA if you take on this new role of
    premarket approval. There is going to be a huge staffing
    increase. Why would that not also be possible for the folks in
    CLIA or somewhere in CMS to do the same thing? I ask both of
    you that question.
        Dr. Shuren. So we already have existing staff who do
    exactly these kinds of reviews, and we have years of experience
    on it. We have training programs for our people. And in terms
    of additional resources, one of the reasons that we put in
    place a phased-in approach would be also for tests that are out
    there, one, not disrupt the market; two, that we could try to
    accommodate what resources we have. But in addition, if we need
    additional resources, we have a user-fee program under which we
    work with the regulated community about appropriate funding for
    services that we then provide back like performance and
    premarket review. And that program, as you know, has been in
    place for a number of years.
        Mr. Schrader. So minimal staffing increase is what you are
    suggesting?
        Dr. Shuren. It depends on the ultimate framework that goes
    into place as to what that workload would look like.
        Mr. Schrader. All right. Mr. Conway, if you can.
        Dr. Conway. On the CMS side, as I mentioned in the central
    office we have approximately 25 people in total overseeing
    CLIA. They are trained for their job, which they do well, which
    is oversight of laboratories, laboratory by laboratory. There
    are no medical officers, there are no Ph.D.'s, biostatisticians
    because we do not do premarket review.
        Mr. Schrader. I just get concerned still--sorry--because
    both your testimonies talk about accuracy, both of you. You
    both talk about reliability. And that sounds like overlap to
    me. So I am just concerned that we don't go down that road.
    Question on peer-review. I mean a lot of treatments and
    diagnoses are peer-reviewed in the literature and stuff. Has
    that occurred at all with laboratory tests? Is there any
    literature reviewing the efficacy of different laboratory
    tests?
        Dr. Shuren. In our review of tests we do look at published
    literature, and in some cases we have relied completely on
    published literature for certain tests like hemoglobin A1c for
    diabetes.
        This issue about accuracy, our look at it, though, for
    analytical validity is complementary but it is different. We
    truly look at is the test itself and what it measures, is it in
    fact accurate? CMS will look at is that test performed properly
    to get a result.
        Mr. Schrader. That is correct. So I guess my underlying
    concern as a medical professional listening to the testimony is
    that the consumer, as well as the physician or veterinarian, is
    not misled by having premarket review. There is going to be
    some certainty that that test is 100 percent appropriate for
    them in their situation.
        The reason I raised the question about the peer review, I
    mean, generally, the test from my standpoint is a secondary
    adjunct to helping establish the diagnosis. You got a lot on
    clinical sides, you got a lot on knowing your patient, got a
    lot to, you know, based on the environment they are living in.
    There are false positives all the time in every single test,
    false negatives in virtually every single test, whether it is a
    genetic test or, you know, a simple blood test for goodness
    sakes. I just don't want the consumer to be misled that by
    having FDA premarket approval, that that test is going to be
    100 percent. I think that is a mistake.
        At the end of the day I think it is up to the medical
    community, the physician to put that one small piece of the
    puzzle into the, you know, whole diagnostic scheme and come up
    with whether or not that is actually going to be a valid use of
    their patient.
        I am just very concerned the tone here is that we are going
    to put certainty into the art of medicine when there is not
    that much certainty, and the patient will be misled and frankly
    lead to greater lawsuits and customers frankly not
    understanding what medicine is really all about.
        Dr. Shuren. And so the accuracy of that test will also
    depend on what the use of the test is for. You know, when you
    deal with riskier conditions or where there are some tests you
    truly rely on the result of that test. Companion diagnostics,
    for example, it is the result of that test that will be telling
    you should they get Zelboraf, you know, for melanoma. And in
    those cases you want to have a higher accuracy.
        You are right, it is not 100 percent, but also what we
    assure you is that that information is made available to the
    practitioner like you, and you know that when you get that
    number for how accurate it is, the result, it is correct. It is
    the----
        Mr. Schrader. Well, laboratories have different--laboratory
    information from one lab to the other is going to be different.
    I can send the exact same blood sample in to a different
    laboratory. I can send the genetic code in. You testified a
    moment ago you are going to get different information back. So
    the idea that it is going to be dispositive, I would
    respectfully disagree. And I yield my time.
        Mr. Guthrie. Thank you. The gentleman's time is expired.
        I now recognize Dr. Burgess of Texas for 5 minutes.
        Mr. Burgess. Thank you, Mr. Chairman.
        Before I start my time, could I asking for a unanimous
    consent request?
        Mr. Guthrie. The gentleman is recognized.
        Mr. Burgess. Ask unanimous consent to enter the statement
    of the Association for Molecular Pathology into the record. And
    then a further unanimous consent request for a point of
    personal privilege, Mr. Chairman.
        For the past 7 years I have been joined at these committee
    hearings by Mr. Paluskiewicz, whose last name is so difficult
    to pronounce we all know him by J.P. And if I ever seem
    adequately prepared for these hearings, it is only because I
    have had J.P. advising me before we come into the hearing room.
    And so it is with great sadness that I announce that J.P. will
    be leaving my employment, but he will be joining the committee
    staff, so he will be here for all to participate and the
    wondrous things that he has to offer to any committee hearing.
        Thank you, Mr. Chairman. Now recognize for questions.
        Dr. Conway, so if Dr. Shuren puts his guidance out in
    January, are you no longer necessary?
        Dr. Conway. No, sir, and let me explain why. I think there
    will still be a role for CLIA to assess, and this is a
    critically important role, that laboratories have the proper
    equipment, training, protocols, and quality assurance
    procedures in place, and that laboratory-by-laboratory
    certification, which a few people have talked about, is a
    critical role for CLIA.
        Mr. Burgess. But, you know, we have heard several times the
    FDA is under-resourced, so why shouldn't the resources that are
    going to CMS just simply go to the FDA?
        Dr. Conway. So I will speak for CMS. You know, I think in
    the CLIA oversight framework we are efficiently using both
    central office resources and relying on States, which was a
    question earlier, and their State surveyors, obviously a user-
    fee funded program based on user fees based on moderate, high
    complexity, et cetera, and volume. And then we also importantly
    have nonprofit accrediting organizations that are not
    Government organizations, that we--seven of them--approve that
    they meet or exceed CLIA standards. We are using people outside
    of the Federal Government as well to perform these important
    functions.
        Mr. Burgess. Dr. Shuren, this question has been posed to
    you several times in this subcommittee or oversight
    subcommittees about what is the problem that we are trying to
    solve? And last night at 7:00 p.m. you put out a report that
    detailed 20 times where perhaps there were problems with
    laboratory-developed tests, is that correct?
        Dr. Shuren. Yes.
        Mr. Burgess. And I am sure you would make the further
    statement that there are more than that, but we have also seen
    in testimony that what is the total universe of laboratory-
    developed tests? It is in excess of 11,000, is that correct?
        Dr. Shuren. It is above 11,000.
        Mr. Burgess. So the rate at which you have detected
    problems would be, if my math is correct, .18 percent, which
    most things in medicine are hardly that reliable. Is that an
    unfair statement?
        Dr. Shuren. Yes. Reporting systems--first of all, there is
    no reporting system on LDTs. You are not monitoring for
    problems. And so you can't say what the rate is, quite frankly.
        Mr. Burgess. It took you 3 years to provide us with 20.
    When I asked you in hearings, when we were doing the FDA
    reauthorization, what is the problem we are trying to solve? So
    today, now, I have your report, 20 problems that we are trying
    to solve, and we have got a universe in excess of 11,000 tests.
        So let me just ask you this, since you think the risk is
    there from laboratory-developed tests, is there an FDA-approved
    kit that has ever had a failure?
        Dr. Shuren. Yes. And the point is the reason we can
    identify when there are problems and we can deal with it is
    because we have the systems in place and the maker of the test
    has implemented systems internally to identify those problems.
    That is critical. And the work that we are doing doesn't occur
    right now in CMS. It is not duplicative, and they don't go
    away.
        Remember, if you make a test, if you are a conventional
    manufacturer, that lab is going to get your test. They still
    have to perform that test properly, and that is what CMS is
    overseeing, are the laboratory operations conducted properly.
        Mr. Burgess. My time is limited. So do you envision any
    lack of access to testing because of the changes that you are
    proposing in the guidance or the committee is proposing in
    their legislation?
        Dr. Shuren. So we have tried to--a proposal was put in
    place so that we would not disrupt the marketplace. Our goal
    here is to try to assure we do have innovation. We think LDTs
    are important in health care. There is innovation, but----
        Mr. Burgess. I appreciate the recommendation----
        Dr. Shuren [continuing]. There is no value to patients if
    the tests in fact don't work. And one of the problems is
    because we haven't regulated, there has been a disincentive for
    innovation by conventional manufacturers. And we have heard
    from them, particularly the smaller companies are saying they
    are disadvantaged because they make a test and they go through
    and they have to demonstrate their test works. And then you can
    have a lab make the same kind of test go out the door----
        Mr. Burgess. I am going to have to interrupt you because my
    time is limited.
        Just as far as the labs themselves, who do you expect to be
    more greatly impacted, large labs and large hospitals or
    smaller rural labs? Is there likely to be a difference in the
    impact? It is a yes-or-no question.
        Dr. Shuren. The answer is you should regardless be
    developing the science that your test is validated, whether we
    review it or not.
        Mr. Burgess. If you don't know whether the answer is yes or
    no, why wouldn't we want to see an economic impact evaluation
    such as normally would be required in rulemaking but is not
    required in guidance?
        Dr. Shuren. Well, just to clarify again, whether we were
    overseeing them or not, a lab shouldn't be putting any test on
    the market that they haven't gotten the data to validate. What
    we are saying is you should have the data and we would look at
    it before the test went on the market to make sure that that
    test in fact worked.
        Mr. Burgess. And to the question----
        Dr. Shuren. The tests that wouldn't go on the market are
    the ones that in fact don't work.
        Mr. Burgess. And to the question of an economic impact
    statement, as would be required under normal rulemaking
    processes, why shouldn't the committee or the Congress expect
    that?
        Dr. Shuren. We are not under rulemaking because we are not
    imposing new requirements. These requirements already exist
    under the law. As a matter of policy, we have not actively
    enforced them. And in places where we put an enforcement
    discretion policy, we have withdrawn it. We have done that
    through guidance. It has been the practice all along.
        I would say in terms of economic analysis, too, we now have
    seen the lab community has come forward to say LDTs need to
    demonstrate analytical and clinical validity. Moderate- and
    high-risk LDTs need to be subject to premarket review. So those
    pieces, even the lab community has now said, you know what,
    that kind of a framework needs to be in place.
        Mr. Guthrie. The gentleman's time is expired. Would you
    again, Dr. Burgess, make--you had one unanimous consent request
    that we did not act on, then you went to a point of personal
    privilege. Can you make that once again before we move on?
        Mr. Burgess. Yes. It was to add to the record the statement
    from the Association of Molecular Pathology for the record.
        Mr. Guthrie. Without objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Guthrie. Thank you.
        Mr. Burgess. Thank you.
        Mr. Guthrie. The Chair now recognizes Mr. Sarbanes from
    Maryland for 5 minutes for questions.
        Mr. Sarbanes. Thank you, Mr. Chairman. I thank the two
    witnesses for being here.
        This is obviously a very important discussion, and I always
    try to look at these conversations through the eyes of sort of
    my constituents, people out there, and I have got to believe
    that if some of them are paying attention to this hearing, they
    would be scratching their head, the typical patient out there,
    and saying, you mean these kinds of protections and reviews and
    guidance and so forth are not already in place?
        And I understand that, you know, you start out in a
    different time period, and you are now trying to sort of update
    the framework that exists to protect patients out there, and I
    think the average person would think that this is a very
    reasonable undertaking on your part. So there is going to have
    to be some heightened degree of oversight and assurance in this
    arena.
        You have probably touched on all this before I came, but
    could you just take maybe two or three or four of the main
    categories of kind of constituencies out there and give me a
    shorthand on their perspective? What are physicians saying
    about this conversation? What are patient advocate groups
    saying? I think I can probably guess. You have alluded to the
    industry, the lab industry itself, but can you just--and in
    particular, I guess the physician perspective on it would be
    helpful to me, but if you can kind of shorthand those different
    lenses on this discussion.
        Dr. Shuren. We have heard mixed perspectives from the
    physician community. So oncologists have come out to say, yes,
    you need oversight, you need FDA oversight. Pathologists have
    felt that, no, we do not. FDA shouldn't be or should have
    little role in oversight of LDTs. The patient groups have been
    supportive of FDA. The consumer groups, payers have been--the
    medical device industry has been, the laboratory community has
    been split. Some of the labs have been working and promoting a
    proposal with FDA oversight, and the others have been proposing
    a system under CLIA.
        Mr. Sarbanes. The payers, that is interesting. Can you
    expand a little bit on that? Is that because they are seeing a
    lot of costs associated with faulty test results in the use of
    those?
        Dr. Conway. Maybe I will start since I am a large payer. It
    is a challenge in the payer aspect, so including in Medicare
    and similar and private payers. If the tests haven't gone
    through that FDA review, then we have a system of local
    contract medical directors in our national office also, you
    know, small numbers of people trying to review thousands of
    tests that either are identified to us or we identify that we
    need to assess reasonable and necessary for coverage. If there
    were an FDA review, you could potentially take a whole set of
    those that have been through FDA review and have those be
    covered and focus on the ones that are leftover. So this is an
    issue there.
        If you don't mind, on the practicing physician point, I am
    a practicing physician. I train residents and medical students
    on weekends as well. You know, you want an assurance as a
    physician that the test is clinically valid and that the report
    that says the patient has cancer or genetic disease X is
    correct. And the patient wants that assurance as well.
        Mr. Sarbanes. Right.
        Mr. Guthrie. Thank you. And the gentleman yields back his
    time.
        Mr. Lance of New Jersey is recognized for 5 minutes for
    questions.
        Mr. Lance. Thank you very much, Mr. Chairman. Good morning
    to you, gentlemen.
        Dr. Conway, it is my understanding that it is the Division
    of Laboratory Services within the Survey and Certification
    Group within the Center for Clinical Standards and Quality at
    CMS that has responsibility for administering the program. How
    many staff within the division are responsible for inspecting
    labs and reviewing the tests they performed?
        Dr. Conway. We have approximately 25 central office staff,
    and then we have approximately 110 surveyors across the Nation
    and all the States, so a small number per State.
        Mr. Lance. We have heard that there are tens of thousands
    of LDTs out there. Do you believe that the division is capable
    of reviewing all of these LDTs in a timely fashion for clinical
    validity?
        Dr. Conway. No, they are not, either in a timely fashion or
    with the current training of the staff that we have.
        Mr. Lance. And therefore, do you believe that new
    innovation would be effective, I presume, negatively because of
    the potential backlog?
        Dr. Conway. Yes, I would be very concerned about a
    potential backlog and the impact on innovation.
        Mr. Lance. Dr. Shuren, how would the FDA handle the
    workload and how would these submissions be based in line, on
    what priority if this were to be handled by the FDA?
        Dr. Shuren. To handle workload, it is one of the reasons we
    have put in a phased-in approach over a number of years, and
    review would occur--be prioritized based upon risk. What we
    proposed is we would start reviewing higher-risk devices before
    we would look at--high risk before moving to moderate risk.
        Mr. Lance. And to the best of your ability, how long do you
    believe it would take to review an LDT, your best estimate,
    Doctor?
        Dr. Shuren. So for the moderate risk LDTs now, the review
    times are--total times are a little over 100 days, thereabouts.
        Mr. Lance. Thank you. Thank you, Mr. Chairman. I yield back
    the balance of my time.
        Mr. Burgess. Would the gentleman yield to me?
        Mr. Lance. I yield to Dr. Burgess.
        Mr. Burgess. Thank you.
        Mr. Guthrie. Dr. Burgess is recognized.
        Mr. Burgess. On that point, could you state that figure
    again, the moderate-risk LDTs, 100 days? Is that right?
        Dr. Shuren. No, a little over 100 days.
        Mr. Burgess. So there are 11,000 and some laboratory-
    developed tests. You said earlier that 50 percent are low risk,
    so presumably, that leaves 50 percent that are in the moderate-
    or high-risk category, is that correct?
        Dr. Shuren. Yes, that is correct.
        Mr. Burgess. So extrapolating out the number of days,
    assuming none of them are high risk, they are all low risk, and
    that is over 100 days of evaluation at the FDA, I mean that is
    a phenomenal amount of work that is ahead of you, is it not?
        Dr. Shuren. That is one of the reasons why we have looked
    at phased-in approach. We have gotten feedback, too, if we
    should consider any changes and take a different approach for
    some of the tests that are currently on the market, which we
    are doing. And we are also having those discussions about
    funding needs as part of user fee discussions, which are going
    on right now. They get authorized every 5 years. And that has
    been the natural course of business.
        We have those discussions with regulated industry--the
    laboratory community is that the table--to then talk about if
    people want to see a certain performance, what does that look
    like. We know in some of the proposals people have said for
    moderate-risk tests could that review time be 75 days? We can
    have a discussion about what it would take for review in 75
    days.
        Mr. Burgess. I will say some of the performance metrics
    that were introduced after the last FDA reauthorization in
    2012, I don't know that we ever got satisfactory answers back
    to this subcommittee or the Subcommittee on Oversight as to how
    the performance was on that, but there is a general unease that
    the FDA is able to perform its function in a timely fashion.
    During the time that we were doing the hearings for the FDA
    reauthorization, there was hardly a week that went by that
    there was not someone in my office with a tale of woe about a
    drug or device that just seemed to take forever in development
    and that the FDA would sometimes change the rules as that drug
    or device went through the development process. What assurance
    can we give to the laboratory-developed test community that
    they won't encounter similar problems with your agency going
    forward?
        Dr. Shuren. Well, our review times have been actually
    improving under MDUFA III. We are meeting our performance
    goals, as we committed to do. So we are seeing things move in
    the right direction. And I don't know what is happening to
    people coming into your office now. I have heard from other
    Members that they don't have the parade of people that were
    coming in several years ago.
        And you know when I took over the program several years
    ago, I was very upfront with this committee and others that
    there were challenges in the medical device program. We had
    seen roughly a decade of worsening performance, and we
    committed to turn that around. We committed to make changes
    regardless of what happened with MDUFA, and then MDUFA came
    along to give us additional resources. And we have continued to
    see improved performance, and we are going to continue to work
    on it, as we have been doing all along.
        Mr. Guthrie. Thank you.
        Mr. Burgess. I don't know that I share your enthusiasm.
    Thank you, Mr. Chairman.
        Mr. Guthrie. Thank you. The gentleman from New Jersey's
    time has expired, and recognizing Mr. Cardenas from California
    for 5 minutes for questions.
        Mr. Cardenas. Thank you very much, Mr. Chairman.
        My first question is to FDA and CMS. Today in your
    budgeting, are you being asked to do more with less?
        Dr. Shuren. Yes.
        Mr. Cardenas. I am not talking about prospectively. I am
    talking about in the cycle that you are currently in.
        Dr. Shuren. Yes, and that has been even the cycles before
    then. We are always asked to do more with less.
        Mr. Cardenas. OK.
        Dr. Conway. Yes. So it is also true for CMS, long history
    of doing more for less. Thank you for the more with less. Thank
    you for the question. I mean, I have managed in the delivery
    system. I have managed in CMS. I have never managed somewhere
    as hard as this. It is ridiculously harder than running a
    delivery system. And the reason is the amount of resources for
    the job. We are deploying lien and other operational techniques
    to increase our efficiency, learning from manufacturing and
    health systems, and that is working, but this is a major issue.
        Mr. Cardenas. OK. Thank you for clarifying that. I don't
    think the public understands how taxing it is for our agencies
    to continue to do more and more and more and try to protect the
    public and allow the American public to know or feel as though
    there are protections and the agencies are trying their best to
    look out for making sure that when they are engaged in
    something that is a--whether it is FDA-approved or it has gone
    through review of CMS, et cetera, that they can feel safe.
        So thank you for continuing to wade through the struggle of
    doing more with less and doing your best to keep up with that.
    I hope that we as the holders of the purse, Congress, will
    recognize that and realize that we are impeding on the safety
    of our American citizens when we just say no to a reasonable
    request of resources and we just say do with what you have and
    do a better job and just make it happen, easier said than done.
        And thank you for clarifying that in the environment that
    you have been and that this is probably the--I interpret that
    what you said is this is the most difficult environment for you
    to do justice to your efforts than any other environment you
    have been in.
        Dr. Conway. Yes. And I----
        Mr. Cardenas. And understand you are not coming across to
    me as complaining.
        Dr. Conway. No.
        Mr. Cardenas. I think it is important that you just be
    honest with us the way you have been. Thank you.
        Dr. Conway. Yes. No, do you mind if I----
        Mr. Cardenas. No, go ahead, please.
        Dr. Conway. This is the best job I have ever had and the
    most impactful, which is why I have stayed, but the challenge
    of managing in the CMS environment with the resources we have
    for the duty we have for the American people is by far the
    hardest job I have ever had. And I have led in the private
    sector, large groups, large budgets. It is nowhere close. This
    is the most challenging job I have ever had in my life.
        Mr. Cardenas. And again, I thank you for welcoming the
    challenge. It is too bad that we don't lessen that challenge by
    giving you the resources for you to be more effective without
    worrying about not being effective in your responsibilities.
        My family just got the news recently that my wife and I are
    going to be grandparents for the first time. And just the other
    day, we were invited to my daughter and my son-in-law's house,
    and they revealed to us it is going to be a boy. And the reason
    why they found is because my daughter underwent a test that
    went to a laboratory and the results came back. And one of the
    things that they could tell her--it wasn't the purpose of the
    test, but one of the things they could tell her is the gender
    of the fetus. And so it was a wonderful moment.
        However, what if the purpose of that test had been
    inadvertent, the results had been inadvertent? I think that is
    really what the focus of today is about. It is about safety of
    the public. It is about accuracy of what is going on out there.
    It is about whether or not they are being effective. And
    unfortunately, for those people who want less Government or no
    Government, there needs to be oversight from somewhere. I
    personally prefer that Government be involved in that oversight
    instead of just turning it completely over to private
    industries, which happens in some cases.
        But my question to you is, going forward, how do we as a
    country make sure that between CMS, between FDA, what your role
    can be in making sure that these critical tests, these
    laboratories are being accurate with the information to the
    patient, to the actual end-user?
        Dr. Shuren. Well, we have established a task force between
    FDA and CMS--NIH and CDC are also participating--to assure that
    we are not duplicating efforts. In fact, we have had
    conversations with certified laboratories, accrediting lab
    organizations under CLIA, two State licensure programs, and
    confirmed we are not duplicating efforts, but we do want to
    make sure we have good coordination moving forward. And we
    provide the education and information out for laboratories as
    well as we progress, so that work is happening in the task
    force right now.
        Dr. Conway. I agree.
        Mr. Cardenas. Thank you.
        Mr. Guthrie. They gentleman's time expired. And myself, and
    I think speaking for the entire subcommittee, we congratulate
    you on the good news and to your family, the next generation of
    your family, appreciate that very much.
        The Chair now recognizes Dr. Bucshon from Indiana for 5
    minutes for questions.
        Mr. Bucshon. Thank you, Mr. Chairman.
        Now, I have heard complaints that the FDA oversight of LDTs
    would interfere with the practice of medicine. I am a
    physician, cardiovascular surgeon, so I would like you both to
    comment as regulators but also as physicians on your view on
    that.
        Dr. Shuren. So we do not--and as a physician, we do not
    regulate the practice of medicine. Congress actually put in a
    statutory provision prohibiting us from regulating the practice
    of medicine in the medical device program. It is a unique
    provision that pertains to us. What we are regulating, talking
    about regulating, are the tests, the things that we regulate
    already today, reagents, the instruments, the protocol,
    instructions are used that go forward with it.
        In fact, a group of laboratories who were working with the
    device industry, the conventional IVD makers, when they sat
    down and went through it, they began to realize, too, you know
    what, there are parts here that is just like what happens in
    FDA: development, design, validation of tests. Then there are
    all these other activities that occur that are lab operations
    or the practice of medicine. They are not under our preview and
    we have never proposed to ever regulate those.
        Dr. Conway. And likewise, CLIA does not regulate the
    practice of medicine. It does regulate laboratories in terms of
    equipment, personnel, protocols, et cetera, which its focus is
    post-market laboratory by laboratory.
        Mr. Bucshon. OK. Great. And currently, CMS regulates how
    physicians operates a lab, as you described, and performs tests
    within it, but I really haven't heard any complaints about
    interfering with the practice of medicine myself from people
    that I know. Why is it that physicians feel differently maybe
    about the FDA oversight of these particular tests, and how can
    we address those concerns? Does that make sense?
        Dr. Shuren. It does. I think what we are dealing with are
    people who haven't dealt with us necessarily beforehand, and so
    it is new and they are assuming things that we don't believe to
    be the case. I hearken back to Dr. Burgess, who I respect very
    much, when he said when CLIA came in the door you were not a
    fan, but you began to realize the value of it. I would say the
    same thing here. As the lab community works with us--well,
    maybe you will allow it.
        Well, hopefully, we will see much the same here with the
    lab community in working with us. And it is our hope they will
    work with us to make sure that when we are doing things, it
    also best fits for their operations. Again, we both are
    committed and care about that those tests work.
        Mr. Bucshon. Yes. I mean I will just make a comment and I
    will--I mean, as a physician, obviously I want accuracy and
    patient safety to be at the top of the list, right? And again,
    I think Mr. Shimkus said I am not one that is generally for
    Government regulation, but I think in this area that, you know,
    this is a good discussion to be having on behalf of patients,
    and that I think the details and how things end up at the end
    are what are important. So I commend your hard work on trying
    to find the sweet spot as you go about your job.
        Thank you. I yield back.
        Mr. Burgess [presiding]. The Chair thanks the gentleman.
    The gentleman yields back.
        The Chair recognizes the gentleman from Florida, Mr.
    Bilirakis, 5 minutes for questions, please.
        Mr. Bilirakis. Thank you, Mr. Chairman. I appreciate it.
    And this question is for the panel.
        As we go forward with any new regulation--regulatory
    scheme--we need to balance the needs between consistency,
    accuracy, and innovation. In disease areas such as cancer,
    genetic testing is evolving rapidly, and I am sure you agree
    with that. Many major institutions today have developed their
    own gene panels that help diagnose or identify potential
    treatments for cancer patients.
        For example, in Tampa we have the Moffitt Cancer Center,
    the only NCI-designated Comprehensive Cancer Center in Florida.
    They have developed a TruSight Tumor Gene Set, which is used to
    identify lung and colon cancers that will benefit from targeted
    therapies. An advantage of the lab-developed tests is the
    ability to rapidly innovate current tests rather than the
    slower and expensive process of resubmitting to FDA for any
    changes. Centers such as Moffitt have the ability to innovate
    and rapidly improve their lab tests as fast as science evolves.
        Question: How can we resolve issues regarding consistency
    and accuracy and not stifle innovation in these labs and
    important healthcare institutions?
        Dr. Shuren. So one issue for consistency, certainly we
    don't--we were recommending not to have two duplicative systems
    out there, one under FDA, one under CMS, or we will have
    inconsistency. But then we have found that to assure
    consistency, we work with the community on trying to develop
    standards or in guidance so that, as we learn and the science
    evolves, we can have more of a common playing field of what
    performance should look like for certain kinds of tests. And
    that can help ensure consistency in terms of approach.
        Mr. Bilirakis. Thank you. Anyone else?
        Dr. Conway. I agree with Dr. Shuren, and I think, you know,
    from the CMS perspective, we think our strength is in that
    post-market review laboratory by laboratory on the
    qualifications, equipment, and personnel.
        Mr. Bilirakis. Thank you. Anyone else want to jump in? OK.
    Dr. Conway, since both the volume and complexity of lab-
    developed tests on the market today have drastically increased
    in recent years, why hasn't CMS asked for these new
    authorities?
        Dr. Conway. So in terms of authorities we think FDA has a
    critical role in premarket review of clinical validity. We
    think CMS's role through CLIA really is and should be focused
    on laboratory-by-laboratory assessment, survey and
    certification and oversight of accrediting organizations,
    ensuring that the protocols, the equipment, and the standards
    are in place in individual laboratories in a post-market
    manner.
        Mr. Bilirakis. Dr. Conway, does CMS require definitive
    review of the clinical claims being made about the tests?
        Dr. Conway. And Dr. Shuren can certainly comment for FDA.
    On the CMS perspective, we do basic assessment of analytical
    validity so the analyte is the actual analyte in the test. We
    do not do assessments of clinical validity, meaning the test
    actually identifies the condition, the absence or presence of
    the condition it is supposed to identify.
        In our coverage process, we have occasionally looked at
    laboratory development tests for reasonable and necessary
    standard. There, we will look at the effect of the test on
    patients, but that is a very small number of LDTs we have
    looked at through that process.
        Mr. Bilirakis. Well, thank you very much, and I yield back,
    Mr. Chairman.
        Mr. Burgess. The Chair thanks the gentleman. The gentleman
    yields back.
        The Chair recognizes the gentleman from New York, Mr.
    Collins, 5 minutes for your questions, please.
        Mr. Collins. Thank you, Mr. Chairman.
        Before I start my questions, I would ask unanimous consent
    to enter into the record a letter from Roswell Park Cancer
    Institute.
        Mr. Burgess. Without objection.
        [The information appears at the conclusion of the hearing.]
        Mr. Collins. Thank you very much.
        In that letter they do mention the same we have talked
    about before, the Association of Molecular Pathology, or AMP,
    and their proposal, and I would certainly encourage the FDA, as
    we are in the discussion stage, to again take a look at this.
        So I guess one thing I am still trying to get clear on, you
    know, currently, a commercial test, something sold on the
    market which does have to go through FDA approval, premarket
    approval, and I assuming that is currently a 510(k)?
        Dr. Shuren. For premarket, most of them are 510(k). A very
    tiny number are PMA.
        Mr. Collins. So as a 510(k) currently, it is a medical
    device subject to the medical device tax, correct?
        Dr. Shuren. Yes.
        Mr. Collins. So if I understand what your guidance is now,
    you are going to move on IVDs out of that world, the medical
    device world, and have a different classification of class 1,
    2, or 3, or low, moderate, whatever. Just a question, does that
    mean on the good news side that IVDs will no longer be subject
    to the medical device tax since they are not going to be
    getting 510(k)s?
        Dr. Shuren. So the trigger for the device tax is
    registering at the listing with the FDA. What we have proposed
    for LDTs is that--and we use that to know what test is being
    made, who is making it, and that is a requirement by law. But
    we have worked through that instead they can give us a
    notification and not list with us, and particularly--and that
    is for starters. And for the tests that don't ultimately come
    in for premarket review, they also wouldn't end up registering
    and listing with us. And that would not trigger the device tax.
        Mr. Collins. So current tests would be still covered by the
    medical device tax even though there is not a 510(k) because
    they would be listed with the FDA?
        Dr. Shuren. They are registered and listed with that, and
    those are----
        Mr. Collins. OK. That clarification is important because I
    have heard that kind of going all over the board.
        Now, another, you know, concern has been, you know,
    accuracy of testing, and I think it is also important to make
    clear laboratory-developed tests are not sold to other
    facilities. They are used inside a facility such as Roswell
    Park, which is looking at very specific treatments for specific
    cancers and what we call personalized medicine. They are not
    then selling those tests to other folks or making claims, which
    is different than a commercialized test, which currently goes
    through FDA approvals.
        But, you know, Dr. Conway, it is my understanding that over
    97 percent of the CLIA laboratory test facilities have
    subjected themselves to outside third-party proficiency testing
    of their tests. Isn't that correct?
        Dr. Conway. So proficiency testing occurs in just 13
    specialty areas, occurs approximately three times per year. It
    has improved the accuracy over time. It will not assess for
    clinical validity of the test, so the premarket clinical
    validity, which Dr. Shuren spoke to, the proficiency testing
    does not analyze clinical validity.
        Mr. Collins. Well, it certainly analyzes whether you are
    properly getting--you know, you are identifying the antigen you
    are supposed to identify.
        Dr. Conway. So it will identify--if that laboratory-
    developed test was within those 13 categories, which they are
    not all within those 13 areas, but for an LDT that was in one
    of those 13 areas--and Dr. Shuren may say more--it will detect
    that the analyte is the analyte, but that is not an assessment
    of the clinical usefulness or validity of the test.
        Dr. Shuren. And it goes to again, if you will, the accuracy
    of the performance of the test as opposed to the accuracy of
    the test itself, which is a different look, and that is what we
    look at for the test.
        Mr. Collins. Yes. I guess I would just say it is my belief
    anyway that the laboratory-developed tests, certainly in
    institutions like Roswell Park, are being done to get better
    treatment, quicker treatment to the patients. And a big concern
    all of us have, if this goes through, that a test might be used
    tomorrow to help a patient with cancer now is delayed 6 months
    as it goes through some kind of premarket review at FDA, which
    is a life-and-death situation for many of these cancers.
        And I think it goes back to--I think I go on to the same
    bandwagon as Mr. Barton and Dr. Burgess. This has not been a
    problem that I would identify, and putting any type of delay
    into this sphere of personalized medicine and treatment
    especially in the cancer and oncology world runs the risk
    frankly of causing people to die that don't need to die,
    treatments that could be given that would be delayed. And in
    the cancer world, delay is not a good thing.
        So personally, I would throw myself into the category I
    believe it is working now. We do have outside proficiency
    testing, third-party testing. And we have to remember these are
    laboratory-developed tests that are not being sold in the
    marketplace to other facilities, which is very different than
    what you are doing now.
        My time has expired, but if the Chair would like to hear a
    response, I would certainly yield a couple seconds.
        Mr. Burgess. Sure. He is recognized for a response.
        Dr. Shuren. I truly appreciate those comments because we do
    not want to stifle innovation in this place. We want to have
    patients get timely access to tests. And that is why even under
    an FDA mechanism if the test is being reviewed, it is being
    developed, it can still be made available to patients on an
    investigational basis or for compassionate use. But there at
    least you are telling the doctor and you are telling the
    patient we haven't validated this test yet. It is
    investigational. This may be----
        Mr. Collins. You know what, I appreciate that because my
    worry was they would develop a test, they couldn't use it until
    they had approval, but if on an investigative basis they know
    that--they think they have a good test they can use it, then
    you have actually helped me in a couple of ways there. Thank
    you for that response.
        I yield back.
        Mr. Burgess. The Chair thanks the gentleman. The gentleman
    yields back.
        The Chair recognizes the gentleman from Pennsylvania, Mr.
    Murphy, 5 questions for questions, please.
        Mr. Murphy. Thank you. Doctor, Doctor, it good to have you
    here, appreciate this.
        I want to pivot a little bit here to talk about piecing
    together post-market and premarket analysis to look at this,
    and in particular, a couple of devices used in women's health
    care, one is called a morcellator. Are you familiar with the
    morcellator, a device that is supposed to shred tumors, et
    cetera, but has been associated with complications in women in
    terms of actually spreading cancer for them?
        Now, it has been on the market for 20-plus years, and the
    FDA admitted for the first time it became aware of the safety
    issue with power morcellators was after December of 2013,
    correspondence from a physician citing the case of a family
    member. This is someone who had just recently had another
    surgery to remove another recurrence of cancer that was spread
    it by the morcellator.
        The manufacturer was apparently aware of the dangers of
    this device as early as 2006 based upon a report from Dr.
    Lamparter, a pathologist from central Pennsylvania, who cited
    about 1 out of 300 samples of morcellated tissue from his
    hospital had evidence of a hidden cancer, which is morcellated.
        So my question is did the FDA have any evidence of these
    dangers in 2006 or prior to that? Are you aware of this
    problem?
        Dr. Shuren. So in the past the thought was what risks of
    cancer there may be for a fibroma--for a fibroid actually to
    have cancer in there--were significantly less. And one of the
    things when we looked into it more recently we came to a
    different conclusion, that the likelihood of cancer is higher.
    There is still disagreement in the community because, as you
    know, the healthcare professional societies disagree. They
    think we have overestimated the risk of cancer.
        We said we have a different perspective, and that is why we
    went out and we put contraindications and warnings on the use
    of that device, that it should only be used in a more limited
    set or offered as an option in a limited set of women and think
    about primarily women who, in the absence of using the device,
    would no longer be able to bear children but they want to bear
    children. And we felt those cases the risk of the cancer is
    very low. They should have the opportunity to weigh in, but we
    scaled back dramatically how that should----
         Mr. Murphy. So this is a case where the science available,
    the premarket analysis has changed, and what is being used in
    the data, you have a mechanism to go forward on this and make
    some changes. Let me ask another question.
        Brigham and Women's Hospital was aware of the dangers in
    2012. A patient by the name of Mrs. Erica Katz was seriously
    injured in 2012 by the device and then died in 2013 according
    to reports. I wondered, do you know if that hospital reported
    that to the FDA? Would you know?
        Dr. Shuren. I am not aware that----
        Mr. Murphy. Is there a mechanism where the hospital is
    supposed to report that or the manufacturer is supposed to
    report that so you can do the analysis?
        Dr. Shuren. So user facilities have certain requirements
    for reporting. So do manufacturers if they become aware of
    certain events. And what I can tell you is we have been looking
    into those concerns that have been raised regarding reporting.
        Mr. Murphy. OK. In response to congressional inquiries
    about this, the FDA admitted that the 1-out-of-350 risk does
    not address other types of malignancies, which you would add to
    that risk, you said. They went on to say the FDA also
    identified studies showing that morcellated patients had worse
    outcomes than patients who had not undergone morcellation.
        So this is more than just the issue with just a fibroid or
    if it is cancerous. It is also a question of outcomes. Is this
    something that the FDA is reviewing also with regard to their
    stamp of approval on these things in terms of the outcome
    measures?
        Dr. Shuren. So in terms of the tests we have looked at, we
    think where we have constrained it right now is--for use is
    where the benefits outweigh the risks, but we are continuing to
    look at new data as it arises, and if so, we will act
    accordingly.
        Mr. Murphy. Thank you. There is another issue in women's
    health that was brought to my attention. It is a product called
    Essure. It is a permanent birth control device that went
    through FDA's rigorous premarket approval process. Yet despite
    getting the agency's approval, it has been linked to at least
    four deaths and deaths of five unborn children. Apparently, a
    total of 24,000 women have come forward claiming that they have
    been harmed by this device. And so the question is how it
    remains on the market with a potential for problems. And
    because this has the FDA stamp of approval, these women feel at
    this point they cannot take their cases forward, and they feel
    they don't have any recourse. Is the FDA also reviewing this
    issue as well as far as you know?
        Dr. Shuren. We are. In fact, we held an advisory committee
    meeting a few weeks ago at our behest to give an opportunity to
    put what new evidence is on the table to assure that people who
    wanted to raise concerns about it had an opportunity to provide
    those concerns. And we are now currently reviewing the feedback
    we received from the advisory committee, as well as what we
    have heard from other people, as well as the state of the
    evidence, and we will come out with our conclusions on that to
    the public.
        Mr. Murphy. Thank you. And as this goes through, since this
    hearing has been a lot about premarket analysis, what this
    comes down to is I just want to make sure that we are aware of
    what mechanism you have, because I understand the science of
    1996 is different from the science of 2015 and our knowledge
    base, but to have an ongoing mechanism for review and changes,
    devices and getting information there and looking at those
    things, I mean, I am glad you had some hearings on this, but I
    would certainly like to know that that is part of the system.
        I am out of time, but I look forward to hearing your
    comments on that in the future. Thank you.
        Mr. Burgess. The gentleman yields back. The Chair thanks
    the gentleman.
        The Chair recognizes the gentleman from Texas for a
    unanimous consent request.
        Mr. Green. Mr. Chairman, I ask unanimous consent to place
    in the record ``Public Health Evidence for FDA Oversight of
    Laboratory Developed Tests: 20 Case Studies.'' I ask unanimous
    consent to place that in the record.
        Mr. Burgess. Without objection, so ordered.\1\
    ---------------------------------------------------------------------------
        \1\ The information has been retained in committee files and also
    is available at  http://docs.house.gov/meetings/IF/IF14/20151117/
    104127/HMTG-114-IF14-20151117-SD009.
    ---------------------------------------------------------------------------
        Mr. Burgess. And I recognize myself for an additional
    unanimous consent request to add the statement of the American
    Association of Clinical Chemistry to the record. Without
    objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Burgess. Seeing no further Members wishing to be
    recognized for questions, I do want to remind Members they have
    10 business days to submit questions for the record, and I ask
    the witnesses to respond to those questions promptly. Members
    should submit their questions by the close of business on
    December 2.
        With that, the subcommittee stands in adjournment.
        Dr. Shuren. Thank you.
        [Whereupon, at 12:07 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]

                     Prepared statement of Hon. Fred Upton

        The 21st Century Cures Act passed this committee 51-0 and
    was through the House in July with 344 votes. It was the
    product of over a year's worth of ideas Members received at
    hearings, roundtables in DC and across the country. Provisions
    were proposed and fleshed out with the help of a wide variety
    of stakeholders, in and out of Government, of all political
    stripes. It goes without saying that for any piece of
    comprehensive legislation to garner these vote totals,
    compromise is critical and the perfect can't become the enemy
    of the good. It also goes without saying that some important
    pieces of the puzzle didn't get included because the timing
    just wasn't right. Modernizing our regulatory framework for the
    review and oversight of diagnostics is one of those pieces.
        As I said at our first forum on this topic in July 2014,
    these increasingly important and complex tests are providing
    researchers and clinicians with valuable tools to match the
    right patients with the right treatments. We must ensure that
    our laws and regulations keep pace so that innovation in this
    space continues and patients benefit from accurate and reliable
    tests.
        I saw Cures as a unique opportunity to elicit feedback on
    what such a framework should look like and what role Congress
    could play in developing it. We issued a white paper asking
    targeted questions and were overwhelmed with the scope and
    thoroughness of the responses we received. We realized early on
    that the traditional medical device framework was not ideally
    suited for these unique tests, which provide clinicians with
    critical information but do not actually provide therapy to a
    patient.
        It was also apparent that there was quite a difference of
    opinion about what the roles and responsibilities of FDA and
    CMS should be. Developing legislative language with broad
    support on an abbreviated timeframe was not achievable. I told
    my staff to table these discussions until we got Cures through
    the House but to urge stakeholders to use the time to forge
    ahead and find as much common ground as possible.
        I was very encouraged to hear that a diverse group of
    stakeholders with different points of view came together and,
    in the spirit of finding consensus, developed a draft framework
    that answered a lot of our questions in a responsible, balanced
    manner. Of course there is room for improvement, but folks need
    to be realistic in their approach and pragmatic with their
    suggestions if the ultimate goal is a bill signed into law any
    time soon. We must get this right and we need everyone's help
    in order to do so.

                  Prepared statement of Hon. Renee L. Ellmers

        Earlier this year, Democrats and Republicans on the House
    Energy and Commerce Committee worked together to develop the
    21st Century Cures legislation. I was proud to work with my
    colleagues on that landmark initiative in order to reduce
    regulation, inspire innovation, improve outcomes for patients
    and move our country towards precision medicine. Further, that
    legislation helped highlight the increased importance of
    diagnostics in modern health care.
        Today, diagnostics play a critical role in the rapid
    detection and diagnosis of diseases. Diagnostics help identify
    targeted, effective and often less invasive treatments-
    ultimately leading to reduced costs to both patients and the
    Government.
        The Committee's current discussion draft legislation
    follows the work of 21st Century Cures and focuses on the
    future of diagnostics. It would advance innovation, protect
    patients, provide a predictable and timely path to market and
    avoid duplicative regulation. It does this by tailoring an
    appropriate role for the FDA (outside of the medical device
    framework) to oversee diagnostic test development activities,
    while modernizing CLIA oversight of separate and distinct
    laboratory operation activities.
        Without this legislation, I am concerned that the FDA would
    finalize guidance to regulate laboratory developed tests as
    medical devices, which could impact many stakeholders. This
    guidance may lead to costly litigation and uncertainty or could
    hamper innovation and patient access to critical diagnostic
    tests.
        Also, I am deeply concerned that this guidance would result
    in the medical device tax being imposed on laboratories. Dr.
    Shuren confirmed during the hearing in September 2014, that
    under the FDA's guidance, labs would ultimately be directly
    subject to this medical device tax. Labs already pay the tax
    indirectly when they purchase test kits from manufacturers, so
    under the guidance they would unfairly pay the same tax twice.
        I have many stakeholders in my district, so this discussion
    draft legislation represents a good compromise between the
    CLIA-centric approach and the medical device framework laid out
    in the FDA guidance. In addition, my district is home to many
    veterans and military families who rely on TRICARE for their
    health care, so ensuring market stability and access to these
    crucial tests directly affects my constituents.
        I am thankful for stakeholder engagement in finding a
    legislative solution that provides a feasible alternative to
    FDA's draft guidance. I stand prepared to work with the
    chairman and ranking member in order to accomplish this goal.

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