On July 31, 2014, the FDA gave Congress notice that in the next 60 days it would be announcing draft guidelines on the regulation of laboratory developed tests (LDTs). This topic has been discussed on the Genomics Law Report frequently for years. [You can access the previous coverage here].
The “Anticipated Details of the Draft Guidance for Industry, Food and Drug Administration Staff, and Clinical Laboratories: Framework for Regulatory Oversight of Laboratory Developed Tests (LDTs)” mark a large expansion of FDA regulatory activity into industry practices that have been–depending on your perspective on the scope of the agency’s regulatory power—enjoying the FDA’s discretionary forbearance from regulation or taking place just outside of FDA’s regulatory reach. Indeed, aside from a few “it has come to our attention” letters in Summer 2010 and the second, more forceful warning letter issued to 23andMe in Fall 2013, the FDA has not taken action against companies providing individuals with direct-to-consumer (DTC) access to their personal genetic/genomic information.
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For the past few years, discussions regarding the regulatory oversight of direct-to-consumer (DTC) genetic tests have focused heavily on one agency: the FDA. Attention has grown since 2010 when the FDA began hinting the agency would broadly regulate laboratory developed tests (LDTs) and has only intensified since the issuance of the infamous cease-and-desist letter issued to 23andMe in late 2013. Now 23andMe and the FDA are hitting the reset button to begin the long road to restore 23andMe’s Personal Genome Service® one condition or trait at a time (the company announced on June 20, 2014 that it has filed, and the FDA has accepted for review, its first 510(k) application for Bloom Syndrome). The personal genomics industry continues to wait anxiously for the FDA proposed rules on DTC genetic tests, which are on the FDA’s Draft Guidance “B-List” for FY2014 (i.e., DTC genetic tests are not among the FDA’s top priorities).
Perhaps it’s time another administrative agency is brought into the discussion. This year the Federal Trade Commission (FTC) has taken its first actions to protect consumers of genetic tests. The FTC has broad authority to protect consumers from unfair and deceptive trade practices (including false and misleading advertising claims) under Section 5(a) of the FTC Act, 15 U.S.C. 45(a)(1). The FTC also enforces posted corporate privacy policies. The FTC filed charges against two companies in January (Genelink, Inc. and its former subsidiary foru™ International Corporation) and filed charges against a third company in June (L’Oreal USA, Inc.) for “purported personalized genomics products.” The charges related to the marketing of nutrigenetic and dermagenetic products. The matters against the first two companies were resolved by settlement approved on May 12, 2014. The FTC announced a proposed settlement of the charges against L’Oreal on June 30, 2014.
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A Canadian court made headlines this month when it decided, as a preliminary matter, that human tissue removed from the body for diagnostic medical tests is “personal property” that belongs to the hospital where the procedure was performed. The case was a medical negligence action brought against two doctors by the estate of Snezana Piljak, a woman who was diagnosed in 2009 with colorectal cancer and died in 2011. At issue in the case is whether the doctors were negligent in failing to diagnose the cancer in 2008 when a colonoscopy was performed on Ms. Piljak. The doctors had petitioned the Canadian court for access to liver tissue biopsied from Ms. Piljak in 2009 at Toronto’s Stonybrook Hospital. The court had to address the matter of tissue ownership before it could consider whether the defendant-doctors had a right to access the liver tissue in order to investigate whether Ms. Piljak had hereditary non-polyposis colorectal cancer (HNPCC or Lynch Syndrome). If the HNPCC were indicated by an examination of the tissue, the defendant-doctors would use that fact to mount a defense against the accusations of negligence. The court ruled that the tissue was personal property of the hospital (though it ultimately denied the defendant-doctors’ request to examine it for technical reasons). The decision that human tissue is “personal property” has important legal ramifications that might affect the biotech industry and genetic research community outside of Canada. The question of ownership of biospecimens has often been tangled up with the status of the biospecimens as personal property, though they are distinct questions.
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This year’s first news in the area of genetics and criminal law comes to us from California, where both the judicial and legislative branches are reacting to the U.S. Supreme Court decision in Maryland v. King. In Maryland v. King, the Supreme Court upheld DNA fingerprinting as a routine booking procedure for serious crimes as authorized by Maryland’s DNA Collection Act. Justice Kennedy’s opinion in King indicated it was intended to be a narrow ruling, focused on the specific facets of Maryland’s state statute. This narrow scope effectively left other DNA fingerprinting schemes open to constitutional challenges if they could be distinguished from the details of the Maryland statute. Among those schemes are California’s Proposition 69 and the Federal DNA Fingerprint Act of 2005. The latter scheme was upheld en banc (all the judges of the circuit sitting together, rather than in the usual three-judge panel) by the Third Circuit Court of Appeals in United States v. Mitchell in 2011 (United States v. Mitchell, 652 F.3d 387 (3rd Cir. 2011) (en banc), pet. for cert. filed (Nov. 22, 2011) (No. 11-7603, 11A384), cert. denied – S.Ct. – (Mar. 19, 2012).
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On November 19, 2013—three days before the highly-publicized warning letter to 23andMe (See here and here)—the U.S. Food and Drug Administration announced that it had given approval for the marketing of four Illumina MiSeqDX medical devices. They include two cystic fibrosis genetic assays as well as the Illumina MiSeqDX instrument platform and Illumina Universal Kit reagents. The FDA’s press release characterizes them as “devices that can be used for high throughput gene sequencing, often referred to as ‘next generation sequencing’” (NGS). These instruments, reagents, and test systems allow labs to sequence a patient’s DNA (deoxyribonucleic acid).
What does the FDA’s approval of the MiSeqDx platform for the clinical market mean for the DTC industry? For example, does this mean that 23andMe could just switch platforms from the Illumina HumanOmniExpress-24 format chip to MiSeqDx and be free from future FDA meddling? Could new companies enter the industry free from regulatory burdens by using Illumina’s MiSeqDx platform? Don’t bet on it.
It is likely that the FDA would take the position that its 510(k) premarket approval (a process John explained briefly on December 3) of the MiSeqDx instrument and MiSeqDx Universal Kit was not intended to be a blanket “go ahead” for DTC providers to offer a service like 23andMe’s Personal Genome Service®. Rather, it is more likely that the FDA would insist on review and pre-market approval of MiSeqDx as an next-generation sequencing in vitro diagnostic (or NGSIVD) if it were used for any purpose other than return of raw genomic data (i.e., if any interpretation were provided along with that raw data). It is also unclear to what extent these FDA approvals will allow future applicants to rely on the approved MiSeqDX products as “predicate devices” to clear some of the regulatory hurdles more easily. (Specifically, the future applicant would claim that its device was “substantially equivalent” to the already-approved device.)
The FDA’s own press release nowhere mentions a non-patient consumer. The press release emphasizes how next-generation sequencing technologies are “becoming more accessible for use by physicians,” underscoring the FDA’s continued insistence that clinicians be the gatekeepers for accessing information about one’s genome. The press release states front and center: “The new technology also gives physicians the ability to take a broader look at their patients’ genetic makeup and can help in diagnosing disease or identifying the cause of symptoms.”
The FDA’s approval of the MiSeqDx platform is thus intriguing, but the future regulation of DTC genomic testing remains uncertain. The 510(k) approval of the MiSeqDx platform may signal that raw data provided DTC might be acceptable to the FDA but that interpretation of that genomic data in any way related to health would still provoke FDA scrutiny and, possibly, hostility. Could a DTC provider use the MiSeqDx platform and successfully argue that its interpretation of raw data is a Laboratory Developed Test (LDT; a test manufactured and used within a single CLIA-certified lab) and, therefore, potentially outside the reach of the FDA? We can’t say for sure at this point. As for the implications of this for 23andMe, as I reported on December 6, current indications suggest that the company is still trying to gain FDA approval of its Personal Genome Service.
In an effort to quiet the storm, 23andMe has announced that it does intend to continue seeking FDA approval and that, while that process is ongoing, it will no longer provide health-related information to new customers. Customers whose Personal Genome Service® kits were ordered prior to November 22, 2013 will still have access to that information; however, customers whose PGS was ordered after the FDA warning letter will only have access to ancestry information and their raw data. The company also announced that it would offer a refund to those who ordered the PGS on or after November 22, 2013.
So is this a victory for the FDA? Is this a loss for 23andMe? A setback for consumers? A win for anyone?
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As if the FDA warning letter wasn’t enough, 23andMe, Inc. now has a lawsuit on its hands. The suit, known as Casey v. 23andMe, was initiated on November 27, 2013, in federal court for the Southern District of California (Case 3:13-cv-02847-H-JMA). The suit is being brought as a class action and on the general basis of breach of implied warranties, unjust enrichment, and misrepresentation.
The Proposed Class
John Conley described this as a “Revolt” of the “Cs,” the consumers of the Direct-to-Consumer (DTC) genetic/genomic industry. As of now, the class relates to one named consumer, Lisa Casey. The Complaint avers that she purchased the test in September after exposure to the 23andMe advertising and received an email in November, just before the FDA’s warning letter was issued, alerting her that her results were ready. It is pure chicken-and-egg speculation as to whether the alleged victim found an attorney willing to take her case or, alternatively, whether the attorney of record found a victim willing to become representative for the class.
It is unclear how many individuals are “similarly situated” and will fit as members of the proposed class. While estimates placed those genotyped by 23andMe at 400,000 individuals, it is unclear how many of those individuals were customers (i.e., those who purchased the PGS®) as opposed to recipients of complimentary analysis from 23andMe or a third-party. For now, saying there is a “revolt” of the “Cs” may be a bit premature.
The causes of action set forth in the complaint include unfair and fraudulent practices, unlawful practice, false and misleading advertising, misrepresentation, breach of the implied warranty of merchantability and fitness for a particular purpose, unjust enrichment, deceit by concealment, and negligent misrepresentation.
The Plaintiff is seeking injunctive relief to prevent 23andMe from “continuing to engage, use, or employ its unfair and fraudulent practice of advertising the sale and use of the PGS products.” (Complaint Paragraph 49) Plaintiff is also seeking restitution (i.e. return of her $99 + tax), attorney’s fees, punitive damages allowable by the consumer protection statutes cited, court costs, applicable interest, and any further relief deemed just and proper. (Complaint Page 25).
As part of her second cause of action, the Plaintiff alleges 23andMe’s activities violate the FD&CA, 21 USC §§301, et seq. (as the FDA asserted in its warning letter but has not yet been adjudicated), the California Sherman Law, Health & Safety Code §110100, et seq., numerous sections of the CLRA, Civil Code §1750, et seq., and the California Business & Professions Code §17500. (Complaint Paragraph 56). And Plaintiff further alleges, in her third cause of action, that 23andMe engaged in a series of misrepresentations, including about its “characteristics, ingredients, uses, and benefits, which it does not have” (Complaint Paragraph 79a); that 23andMe’s PGS “is of a particular standard, quality, or grade, which it is not” (Complaint Paragraph 79b); that the PGS was advertised “with an intent not to sell the PGS as advertised” (Complaint Paragraph 79c); and that 23andMe “represented that the subject of the sale of the PGS has been supplied in accordance with a previous representation when it has not” (Complaint Paragraph 79d).
Burdens of Proof
Generally, the burden of proof rests on the Plaintiff to establish each of the essential elements for a cause of action. To prove fraud, generally speaking, the Plaintiff must prove with clear and convincing evidence that there was a misrepresentation uttered fraudulently, that the maker of the statement intended for the recipient of the utterance to be induced to act, that the recipient justifiably relied upon the misrepresentation thereby damaging the recipient. To prove fraudulent or negligent misrepresentation, it is necessary for the Plaintiff to demonstrate that the Defendant made statements that the Defendant knew were false or made statements recklessly without knowledge as to their truth or falsity and without making reasonable investigation into the veracity of the statements. Furthermore, to prove unjust enrichment, the Plaintiff must show not only that the Defendant was enriched at her expense but also that it would be unjust for the Defendant to keep that benefit without compensating her for it.
How will the Plaintiff meet those burdens of proof?
Plaintiffs sometimes satisfy the first element of such unfair and deceptive trade practice claims (i.e., that there was an unfair or deceptive practice) by pointing to the Defendant’s violation of another statute or regulation and advocating a per se theory of liability. In other words, the Plaintiff argues that the Defendant, by violating the specifically cited statute or regulation, has per se engaged in an unfair and/or deceptive practice. The conclusory statements excerpted by the Plaintiff from the FDA’s warning letter alone will not be sufficient to establish a case. The Plaintiff seems to be trying to use 23andMe’s failure to provide the FDA with information supporting their claims to prove absence of such information. Such an implication is nonsequitur. The authority of the FDA over 23andMe’s activities has not been established and has been seriously questioned by many. Moreover, 23andMe’s acts or omissions with regard to FDA requests have not been adjudicated. Just because the FDA claims something is true does not make it so.
The Plaintiff will face additional challenges in proving her case. For example, she will have to find a way to overcome several provisions of the Terms of Service (ToS) to demonstrate that the advertising claims were anything more than acceptable puffery.
23. Disclaimer of Warranties
YOU EXPRESSLY ACKNOWLEDGE AND AGREE THAT: (1) YOUR USE OF THE SERVICES ARE AT YOUR SOLE RISK. THE SERVICES ARE PROVIDED ON AN “AS IS” AND “AS AVAILABLE” BASIS. 23ANDME EXPRESSLY DISCLAIMS ALL WARRANTIES OF ANY KIND, WHETHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, AND NON-INFRINGEMENT. (2) 23ANDME MAKES NO WARRANTY THAT (a) THE SERVICES WILL MEET YOUR REQUIREMENTS; (b) THE SERVICES WILL BE UNINTERRUPTED, TIMELY, UNFAILINGLY SECURE, OR ERROR-FREE; (c) THE RESULTS THAT MAY BE OBTAINED FROM THE USE OF THE SERVICES WILL BE ACCURATE OR RELIABLE; (d) THE QUALITY OF ANY PRODUCTS, SERVICES, INFORMATION, OR OTHER MATERIAL PURCHASED OR OBTAINED BY YOU THROUGH THE SERVICES WILL MEET YOUR EXPECTATIONS AND (e) ANY ERRORS IN THE SOFTWARE WILL BE CORRECTED. (3) ANY MATERIAL DOWNLOADED OR OTHERWISE OBTAINED THROUGH THE USE OF THE SERVICES IS DONE AT YOUR OWN DISCRETION AND RISK AND THAT YOU WILL BE SOLELY RESPONSIBLE FOR ANY DAMAGE TO YOUR COMPUTER SYSTEM OR LOSS OF DATA THAT RESULTS FROM THE DOWNLOAD OF ANY SUCH MATERIAL. (4) NO ADVICE OR INFORMATION, WHETHER ORAL OR WRITTEN, OBTAINED BY YOU FROM 23ANDME OR THROUGH OR FROM THE SERVICES SHALL CREATE ANY WARRANTY NOT EXPRESSLY STATED IN THE TOS. (5) YOU SHOULD ALWAYS USE CAUTION WHEN GIVING OUT ANY PERSONALLY IDENTIFYING INFORMATION ABOUT YOURSELF OR THOSE FOR WHOM YOU HAVE LEGAL AUTHORITY. 23ANDME DOES NOT CONTROL OR ENDORSE ANY ACTIONS RESULTING FROM YOUR PARTICIPATION IN THE SERVICES AND, THEREFORE, 23ANDME SPECIFICALLY DISCLAIMS ANY LIABILITY WITH REGARD TO ANY ACTIONS RESULTING FROM YOUR PARTICIPATION IN THE SERVICES.
6. User Representations
By accessing 23andMe Services, you agree to, acknowledge, and represent as follows:
a.You understand that information you learn from 23andMe is not designed to independently diagnose, prevent, or treat any condition or disease or to ascertain the state of your health in the absence of medical and clinical information. You understand that the 23andMe services are intended for research, informational, and educational purposes only, and that while 23andMe information might point to a diagnosis or to a possible treatment, it should always be confirmed and supplemented by additional medical and clinical testing and information. You acknowledge that 23andMe urges you to seek the advice of your physician or other health care provider if you have questions or concerns arising from your Genetic Information.
23andMe Services are for research, informational, and educational use only. We do not provide medical advice. The Genetic Information provided by 23andMe is for research, informational, and educational use only. This means two things. First, many of the genetic discoveries that we report have not been clinically validated, and the technology we use, which is the same technology used by the research community, to date has not been widely used for clinical testing. Second, in order to expand and accelerate the understanding and practical application of genetic knowledge in health care, we invite all genotyped users to participate in 23andWe Research. Participation in such research is voluntary and based upon an IRB-approved consent document. As a result of the current state of genetic knowledge and understanding, our Services are for research, informational, and educational purposes only. The Services are not intended to be used by the customer for any diagnostic purpose and are not a substitute for professional medical advice. You should always seek the advice of your physician or other health care provider with any questions you may have regarding diagnosis, cure, treatment, mitigation, or prevention of any disease or other medical condition or impairment or the status of your health.
23andMe does not endorse, warranty or guarantee the effectiveness of any specific course of action, resources, tests, physician or other health care providers, drugs, biologics, medical devices or other products, procedures, opinions, or other information that may be mentioned on our website. If we provide to you on our website any recommendations that identify for you, based on your Genetic and Self-Reported Information and scientific literature or research, potentially actionable information, this information is intended for informational purposes only and for discussion with your physician or other healthcare provider. As explained on our website, 23andMe believes that (a) genetics is only part of the picture of any individual’s state of being, (b) the state of the understanding of Genetic Information is rapidly evolving and at any given time we only comprehend part of the picture of the role of genetics, and (c) only a trained physician or other health care provider can assess your current state of health or disease, taking into account many factors, including in some cases your genetics as well as your current symptoms, if any. Reliance on any information provided by 23andMe, 23andMe employees, others appearing on our website at the invitation of 23andMe, or other visitors to our website is solely at your own risk.
While it is possible, it is very unlikely that a court would find the features of the Terms of Service unconscionable (and therefore unenforceable) because they are so one-sided that they “shock the conscience” (See UCC §2-302). After all, is it reasonable for a consumer to rely upon advertising claims and disregard the terms of the consumer contract governing the purchase or warnings made by the manufacturer? Puffery is permissible (e.g., is Snapple® really made from “the best stuff on Earth®”? Does Coast® soap’s scent really “open your eyes”? Are Wheaties® still “the Breakfast of Champions”? Does Weight Watchers® really have “the power to lose weight like never before”?).
Even if the consumer doesn’t read the contract, generally contractual terms are enforceable. [Now might be a good time for you to review those store receipts from purchases you made on Black Friday, Small Business Saturday, or even Cyber Monday!]
Potential for Civil Litigation = A Means of Shaping Industry Behaviors without Specific Regulation
If this case were to proceed to trial, we can expect a collision of scientific fact, legal fact, and societal belief. Where do those categories overlap? Did the advertising claims cross the line? How would reasonable jurors decide? The jury pool could conceivably contain genomophobes, genomophiles, and individuals with perspectives on personal genomics everywhere in between. An all-star cast of expert witnesses could be called to testify for either side, raising never-old questions about whether a scientific expert is a pure educator, an assistant advocate, a hired gun, or a provider of good data for a favored cause (See Science and the Law: Standards, Statistics and Research Issues by David L. Faigman, David H. Kaye, Michael J. Saks, and Joseph Sanders, American Casebook Series, 2002).
Civil suits are an effective way to shape industry practices incrementally. They are a form of policymaking based on actual harms rather than speculations and mere possibilities of harm. As such, the industry behaviors shaped by the threat of litigation and by resolution of litigation can be preferable to the adoption of specific regulations, driven by genetic exceptionalism and paternalism (and occasionally also genetic determinism) and made in the absence of data demonstrating harms of the technology or service. Given the low levels of genetic literacy generally, the dangers of advertising (regardless of technical veracity and acceptable puffery of the claims used) were bound to catch the industry at some point. (Coincidentally, advertising is risk, too, because business can fall victim to the opportunist element of society, regardless of whether the opportunity sought is financial gain or greater regulation or consumer protection). A serious question will be what should a reasonable person understand about genetic claims by a DTC company. It’s often said that tortfeasers find their victims as they are (i.e., the “eggshell skull” or “eggshell plaintiff” rule) and are liable for the damages their actions cause even if those resulting damages are magnified in an unforeseeable way due to the particular characteristics of the victim. Just how far will a bench or jury allow that doctrine to apply in situations of misunderstanding the meaning of scientific communications notwithstanding substantial efforts by some members of the personal genomics industry to educate the public? Only time will tell.
The Sky is Falling for Personal Genomics! Oh, nevermind. It’s just a cease & desist letter from the FDA to 23andMe.
Genomics Law Report has paid close attention to the FDA’s potential regulation of laboratory developed tests (or LDTs) over the years. We have decided to address the most recent development – a cease and desist letter sent by the FDA to 23andMe – in two posts — by Jennifer Wagner and by John Conley.
A brief background for the newcomers
23andMe, Inc. was founded in 2006. Its personal genomics service launched in 2007 and was named Time Magazine’s Invention of the Year in 2008. Just before the Thanksgiving holiday in 2009, 23andMe split its all-in-one service into two separate editions for ancestry and health and raised its price. The following year, just before the 2010 Thanksgiving holiday, 23andMe scratched its business model with separate health and ancestry editions in favor of a return to the all-in-one service with a new mandatory annual subscription fee. By June 2011, the company boasted 100,000 users and in late 2012 lowered its price to $99 to aim for one million users. Recently, 23andMe ramped up its marketing, launching its very first TV ad campaign called “Portraits of Health” in August 2013.
Company’s run-ins with the FDA
On June 10, 2010, the company—along with several other direct-to-consumer (DTC) providers—received a cease & desist letter from the FDA. A full two years later, on July 30, 2012, the company touted it was the first of its kind to
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The World Medical Association published revisions to the Declaration of Helsinki (DoH) in JAMA on October 19, 2013. As noted previously on the Genomics Law Report, the DoH was adopted in 1964 and is considered a foundational guiding document for ethical medical research. The DoH has been revised six times previously, and these are the first revisions since 2008. The revised DoH was announced following the Working Group’s public consultation from April to June 2013 on the text of proposed changes, though the Working Group has apparently spent at least two years contemplating revisions and consulting with experts. In the United States, the DoH has been an important foundational document promoting the creation of institutional review boards (IRBs) but has had relatively little practical influence since it was effectively abandoned by the administration of former President George W. Bush. Nonetheless, the DoH continues to exert significant influence over international ethical standards.
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In her 2010 book The Immortal Life of Henrietta Lacks, Rebecca Skloot told the story of Henrietta Lacks and the cell lines derived from her cervical tumor biospecimen (cell lines known to scientists simply as “HeLa cells”). To make a long story short, in 1951 physicians at Johns Hopkins Hospital took a biopsy from a patient, Henrietta Lacks, and from that biospecimen developed the first human cancer cell line. The biospecimen was taken without Lacks’ knowledge or informed consent. No laws were broken in the creation of the HeLa cell lines that are now recognized (pdf) as “the most widely used human cell line in the world.” She died in 1951, and it was reportedly not until 1973 that her family learned about the HeLa cells (two years after Henrietta Lacks’ name was published as the source of HeLa cells in a scientific journal). As the table below shows, this incident occurred long before the adoption of regulations and ethical guidelines for biomedical research that, today, generally require researchers to obtain voluntary, informed consent from individuals before performing biomedical experiments.
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