FDA Proposes Down-Classification of Oncology Companion Diagnostics: A Q&A on Precision Medicine

The Food and Drug Administration (FDA) has announced a significant proposed change affecting oncology companion diagnostics (CDx) that could streamline the regulatory process and expand patient access to proven precision medicine strategies. Stacey Gilbert, director, precision medicine from ADVI Health, provides key insights into what this means for the industry.

What is the major change the FDA has proposed?

The FDA has published a proposal to down-classify oncology companion diagnostics from Class III (PMA pathway) to Class II (510(k)).

The agency has also proposed an order to create a new, unified device type called “Nucleic Acid-Based Test Systems for Use with a Corresponding Approved Oncology Therapeutic Product,” which accommodates both essential and CDx adjacent tests.

When will this take effect?

The clock is ticking! The 60-day public comment period has commenced, and if finalized, the order will take effect 30 days after the final decision is published in the Federal Register, which is anticipated to be at the end of February.

Why did the FDA propose this shift for oncology CDx?

The decision is rooted in the FDA’s extensive PMA experience dating back to 2011, with ample evidence reviews and approvals for numerous oncology CDx tests. This suggests that the agency now considers the risks associated with this category of devices to be manageable through general and special controls, rather than requiring the higher-burden PMA pathway.

Why is this development important for the precision medicine space?

If finalized, this rule would shift many oncology-based CDx tests to the 510(k) pathway—a faster, less expensive, and generally more efficient route to market.

More importantly, this change would include not only future device candidates but also any already-approved post-amendment Class III (PMA) devices with product codes OWD, PJG, PQP, and SFL. This should pave the way to make the pool of approved tests bigger!

What “Special Controls” will be required for the new Class II tests?

“Special controls” for safety and effectiveness would be required for the 510(k) submissions. Developers would need to provide:

• Analytical and clinical validation data.
• Evidence pointing out which genomic detection areas are targeted versus non-targeted.
• Information about specimen handling.
• Specific details about biomarkers used/associated with bioinformatics information.
• Established standard operating procedures (SOPs) that mitigate risks in the lab regarding proper sample handling and resulting processes—all of which are appropriate measures.

Which types of CDx devices are covered by the new order?

The new order covers two main groups of CDx devices with reciprocal labeling:

1. Tests that are linked directly to the safe and effective use of an oncology drug, where each product’s label includes information for a clear indication of how they should be used together.
2. Tests that are described specifically in an oncology drug’s label because they provide information that is helpful to understand the risks/benefits of using the drug.

What are the main benefits of this new pathway?

The new pathway should be more efficient, faster, and less expensive. It will allow labs to focus on meeting the bar for equivalence with other approved tests with established biomarkers.

Furthermore, if a test modification is needed in the future, “predetermined change control plans” (PCCP) are an avenue to avoid a new 510(k) submission, providing more flexibility.

What is a key consideration for labs and drug developers under this new rule?

A critical requirement is that for both test types, the FDA-approved test labeling must align with the oncology drug’s labeling. More importantly, labs must align their labeling to the drug’s label, not the other way around.

This creates a label expansion-limiting step for labs that conduct their own research and identify risks or benefits to an oncology drug’s use, a novel biomarker, or a new drug-test relationship. Even if the lab’s clinical evidence shows a clear risk or benefit, the FDA cannot link the two without agreement from the drug developer to update the drug’s label.

How could this order affect precision medicine innovation?

Drug developers and labs must find an agreement to maximize the relationship between their products. Labs should also get ahead of the final ruling by looking at their portfolios, identifying which tests will fall under the new device definition, and mapping out pipeline scenarios for using the 510(k) strategy versus PMA. Any changes they may be considering to a currently approved test could result in a simpler PCCP pathway or require a new submission.

How does the new order affect a lab’s CDx reimbursement strategy?

This is good news for expanding access for seniors to proven CDx strategies in the oncology space!

FDA-approved (or cleared) oncology CDx next-generation sequencing (NGS) tests are automatically approved under Medicare National Coverage Decision (NCD) 90.2 for Medicare beneficiaries. The NCD specifies that the test must:

• Have FDA approval (or clearance) as a companion in vitro diagnostic.
• Have an FDA-approved (or cleared) indication for use in the patient’s cancer.
• Provide results to the treating physician using a report template to specify treatment options.

Also, keep in mind that FDA approved/cleared tests offered by proprietary labs also qualify for Advanced Diagnostic Laboratory Test (ADLT) designation, which sets the test’s Medicare Clinical Laboratory Fee Schedule price at the test’s published list price for the first three quarters.

ADVI Health will be closely following this issue and will provide ongoing updates and insights once more information is available.

ADVI offers expert advice and influential solutions, informed by data and guided by a clear vision of the complex intersection of life sciences/healthcare innovation, economics, policy, and patient impact. Get in touch to receive insights from our Market Access, Precision Medicine team.

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