[Editor’s Note:

On Tuesday, Carmichael and five commentators examined what can be learned from a DTC genetic test. Yesterday, the topic was whether DTC genetic tests are trustworthy, and whether the results can be cause for concern. Today’s topic is the regulation of DTC genetic tests. In addition to several short commentaries, including a much shorter version of the piece below, Carmichael has also posted a lengthy interview with two top FDA officials on the subject of DTC genetic testing regulation.

The column below is an expanded version of what appears over at Newsweek. To see all of the commentaries in Carmichael’s series, click here.]

The recent media attention focused on direct-to-consumer (DTC) genetic tests has left companies, investors, consumers and even regulators scrambling to figure out what comes next.

As the situation stands today, companies and their investors live in a climate of unprecedented regulatory uncertainty, causing delays in the introduction of new products and rendering an already inhospitable economic climate – for both fundraising and sales – even more challenging. Commentators and regulators caution consumers that some DTC genetic tests may be unreliable or, worse, harmful, but have yet to provide clear tools and guidelines for evaluating competing tests. And regulators, including the FDA, must balance their mandate to protect the health and safety of the public with that same public’s desire for autonomy, while also recognizing that innovation is a prerequisite for a healthcare system that must continue to improve outcomes while reducing costs.

Clearly, something must change. But what will that change be? And how will the field of DTC genetic testing evolve? Will DTC be able to continue its current business while regulators and companies engage in protracted negotiations? Will oversight weed out the “snake oil salesmen” and permit legitimate companies to flourish? Will it drive all genetic testing (temporarily) out of the hands of consumers?

Or will the field change in a dramatic and completely unexpected way?

These questions, and others, caused Newsweek science editor Mary Carmichael to realize her oft-debated question – To Test or Not To Test? – might demand an answer sooner rather than later:

. . . I started to worry . . . . How much time did I even have left to decide whether I was going to take a test myself? Even before [last month’s Congressional] hearing, the FDA had announced its plans to regulate all DTC genetic tests, possibly so heavily as to keep them off the market; the hearing was just the sort of thing that could push it to move faster. What if, by the time I finally decided if I wanted one of these tests, I couldn’t buy one anymore?

Setting aside the question of whether Carmichael, or anybody else, should buy a genetic test, this column examines the history of DTC genetic testing regulation in the United States¹ and, in the final section, whether the DTC option is likely to persist in the future.

Because this post is longer than usual, here is a quick, clickable roadmap to its various sections. If you’re already familiar with the history of DTC genetic testing you may wish to jump ahead to the final section or two.

1. 2006: DTC and the First GAO Report.

2. 2007: The Beginning of Modern DTC

3. 2008: SACGHS and a Scare From the States

4. 2009: All Quiet on the DTC Front

5. 2010: DTC Goes to Washington

6. Today: Uncertainty Reigns

7. Tomorrow: Unintended Effects (and More Uncertainty)

8. Beyond: A Delicate Balancing Act

2006: DTC and the First GAO Report. Four years ago last month, the Federal Trade Commission (FTC), Food and Drug Administration (FDA) and Centers for Disease Control and Prevention (CDC) published a consumer fact sheet entitled “At-Home Genetic Tests: A Healthy Dose of Skepticism May Be the Best Prescription.” The guidance warned consumers to be wary of claims made by DTC genetic testing companies and to involve “a doctor or trained counselor who understands the value of genetic testing for a particular situation” when ordering or interpreting any genetic test.

The joint agency guidance document was published in concert with a report from the Government Accountability Office (GAO) entitled “Nutrigenetic Testing: Tests Purchased from Four Web Sites Mislead Consumers” (pdf). The GAO report reviewed a “nonrepresentative selection” of genetic tests available to consumers at that time and concluded that those tests “mislead the consumer by making health-related predictions that are medically unproven and so ambiguous that they do not provide meaningful information to consumers.” The report was praised for “drawing attention to potentially important consumer protection issues,” even as it was criticized for “serious methodological flaws that undermine[d]” those very criticisms (pdf).

Whatever its methodological flaws, the GAO’s description of the system of regulation for DTC genetic testing, which it characterized as one of “minimal oversight [that] makes it difficult for consumers to determine whether a genetic test provides meaningful, scientifically based information,” was entirely accurate.

2007: The Beginning of Modern DTC. With the launch of DTC products from a publicly traded biopharmaceutical company (deCODE Genetics) and a Google-backed startup (23andMe) on back-to-back days in November 2007, the modern era of DTC genetic testing was born. With 23andMe, deCODE and, soon, Navigenics, consumers could now pay around $1,000 to review hundreds of thousands of SNPs. Following Knome’s launch, also late in 2007, they could pay much, much more ($350,000) for access to their entire genome.

Despite this dramatic shift in the DTC product landscape, the legal landscape remained essentially unchanged from 2006. Regulatory oversight was still incomplete, confusing and rarely invoked.

At the federal level, while most DTC genetic tests were likely covered from the outset by the Clinical Laboratory Improvement Amendments of 1988 (CLIA), it was typically difficult to determine whether DTC genetic testing companies were operating using CLIA-certified labs. (23andMe, for example, did not begin using a CLIA-certified laboratory until 2008, making the change in response to “evolving” regulatory requirements.) CLIA, which is implemented by the Centers for Medicare & Medicaid Services (CMS), requires laboratories to demonstrate the analytical validity of their tests, and covers most genetic tests regardless of whether they are provided directly to consumers or not.

In addition to CLIA, a limited number of genetic tests were also regulated by the FDA. Although the proposition was not immediately tested, it was widely assumed that DTC genetic tests constituted a new form of laboratory developed test (LDT), a large and well-established category of tests over which the FDA exercised “enforcement discretion.” While the FDA had historically declined to regulate LDTs, in 2006 and 2007 the FDA expressed its desire to regulate certain types of high-complexity LDTs (so-called IVDMIAs). As is still true today, it was unclear where, if anywhere, the newly introduced DTC genetic tests fell within the LDT conversation and FDA’s larger regulatory universe.

In addition to uncertainty at the federal level, some states possessed (and still do possess) statutes that appear to prohibit – or at least restrict – DTC genetic testing (pdf). However, it was unclear whether such statutes, which clearly predate the arrival of DTC genetic testing in its current form, were intended to prevent DTC genetic testing or whether they would be enforced by state regulators in any event. State-level regulatory restrictions contributed to at least one company withholding its service from citizens in at least 10 states at the time of its launch.

Despite all of this legal uncertainty, no federal or state regulatory agency took any formal action immediately following the introduction of DTC genetic testing to the consumer marketplace.

2008: SACGHS and A Scare from the States. During its first full year, the DTC genetic testing marketplace continued to grow as new companies arrived on the scene and existing companies refined and expanded their offerings.

Meanwhile, an influential government policy committee (SACGHS) had undertaken a review of the “U.S. System of Oversight of Genetic Testing.” When it was published in April of 2008, the 276-page report surprised almost no one when it identified major gaps in the regulation of genetic testing, including insufficient oversight of laboratory quality, clinical validity and a lack of knowledge with respect to the nature and uses of genetic tests available for purchase, whether directly by consumers or otherwise. Among the report’s several recommendations were increased FDA regulatory oversight and the creation of a mandatory, public registry for all laboratory tests.

Shortly after the publication of the SACGHS report, public health officials in New York and California sent “cease and desist” letters to a number of genetic testing companies. The states warned the companies – including 23andMe, deCODE and Navigenics, the three most prominent DTC providers at that time – that they were operating without necessary state licenses.

The SACGHS report and state regulatory letters produced widespread debate about the appropriate regulatory framework for DTC genetic testing. Companies were concerned that other states might follow the example set by New York and California and seek to regulate DTC genetic tests directly, potentially exposing DTC companies to a nightmare scenario of inconsistent, state-by-state regulation. Proponents of regulation, meanwhile, argued that the nascent field needed some regulation “lest abuses discredit the whole industry before it has a chance to thrive.”

In the following weeks, months and even years, some DTC companies received state licenses, although this came at the expense of offering tests directly to consumers in some cases. Other companies ceased selling to customers in specific jurisdictions, and still others simply went out of business. At the federal level, the SACGHS recommendations continued to generate far more discussion than action, and the regulatory landscape remained materially unchanged. Meanwhile, major DTC companies continued to press ahead, and 2008 closed with 23andMe’s DTC genetic test being named Time’s invention of the year.

2009: All Quiet on the DTC Front. In comparison to the years on either side, 2009 was a relatively quiet year for DTC genetic testing, at least from a regulatory perspective.

On the commercial side, however, 2009 saw a number of changes ripple through the DTC genetic testing marketplace. As the price of DTC genetic tests continued to fall, a new competitor, Pathway Genomics, arrived on the scene and 23andMe significantly revamped its product offerings and pricing shortly thereafter. Meanwhile, the financial crisis played a major role in causing DTC pioneer deCODE Genetics to file for bankruptcy protection, although the company quickly emerged under private control and its deCODEme test remains on the market today.

To be sure, regulators continued to ponder how to respond to the rapidly evolving genetic testing marketplace, which included but was not limited to DTC products. For example, the FDA continued to express an interest in regulating some LDTs and the California legislature considered a bill – championed by 23andMe – that would create a special regulatory framework for so-called “post-CLIA bioinformatics services,” although nothing would come of either initiative, at least in 2009. Perhaps most significantly, but unbeknownst to either the public or the major DTC genetic testing companies, Congress had instructed the GAO to begin a second investigation into the DTC genetic testing industry, the results of which would not be made public until the following year.

With regulators seemingly on the sidelines, academics and other commentators, including the Genomics Law Report, continued to stress the need for meaningful self-regulation in order to:

(1) discourag[e] consumers from purchasing products not adequately supported by scientific evidence, (2) provid[e] regulators such as the Federal Trade Commission (FTC) with a standard against which to evaluate (and sanction) false or misleading DTC tests or services, and (3) ensur[e] that inevitable governmental regulation is not overly restrictive.

Prominent scientists, including soon-to-be NIH chief Francis Collins and genomics pioneer Craig Venter, also emphasized the need for greater transparency and consistency in the way DTC companies presented genetic risk of disease to consumers. While there was widespread consensus, including on the part of DTC providers, that self-regulation and even some form of government regulation would be beneficial for the industry as a whole, by the end of 2009 no notable changes – government mandated, voluntary or otherwise – had materialized.

2010: DTC Goes to Washington. Although we are not yet two thirds of the way through the year, 2010 has already seen an explosion of activity in the oversight of DTC genetic testing.

The first major development came in March, when the NIH announced the creation of a voluntary genetic testing registry. In its 2008 report (pdf), SACGHS had recommended the creation of a “mandatory, publicly available, Web-based registry for laboratory tests” in order to “enhance the transparency of genetic testing and assist efforts in reviewing the clinical validity of laboratory tests.” The NIH adopted this recommendation with one crucial exception: the registry, at least as proposed, will be voluntary.  However, it remains to be seen, particularly in light of everything that has happened since the announcement in March, what form the NIH’s registry will ultimately take when it debuts later this year or in early 2011.

For DTC genetic testing, the excitement really began on May 11th, when Pathway Genomics announced it was partnering with Walgreens to offer its genetic testing service on the shelves of most of the drugstore giant’s 7,500 stores. The FDA responded almost immediately with an “Untitled Agency” letter to Pathway Genomics in which the agency informed Pathway that it could find no record of the necessary FDA clearance or approval for Pathway’s test. The Pathway letter – which represented the FDA’s first public foray into the oversight of DTC genetic testing – was followed by similar letters to five prominent DTC genetic testing companies in early June and letters to 14 more genetic testing companies in late July. These letters were, of course, something of a surprise to the companies. The FDA could not find evidence that it had approved the companies’ tests because, in at least some and possibly all cases, the agency had not told the companies that such approval was necessary.

In addition to taking aim at DTC genetic testing companies, the FDA also announced that it was shelving its plan to regulate a subset of LDTs (i.e., IVDMIAs) in favor of a new plan to regulate all LDTs. Late last month the FDA held a two-day “Public Meeting on Oversight of Laboratory Developed Tests” to discuss that plan. (It is important to point out that, despite devoting an entire portion of the public meeting to DTC genetic tests, on multiple occasions the FDA has indicated that it considers at least some DTC genetic tests not to constitute LDTs since the products are “not developed by and used in a single laboratory.”)

Not to be outdone, Congress quickly announced its own investigation into DTC genetic testing (one it had quietly initiated the year before) and followed that up with a public hearing on “Direct-To-Consumer Genetic Testing and the Consequences to Public Health.” The centerpiece of July’s Congressional hearing was yet another GAO report (pdf) whose conclusion was announced in the title: “Direct-To-Consumer Genetic Tests: Misleading Test Results Are Further Complicated by Deceptive Marketing and Other Questionable Practices.” The GAO also presented a striking and widely circulated YouTube video as partial support for its conclusion. (For a more detailed review of the Congressional hearing and the GAO report please see this recap.)

At the Congressional hearing, Jeffrey Shuren, the Director of the FDA’s Center for Devices and Radiological Health (CDRH), assessed the FDA’s recent activity by agreeing with Congressman Michael Burgess (R-TX) that the FDA “should have acted sooner” to regulate DTC genetic tests. Shuren was likely referring to a perceived failure on the part of the FDA to adequately safeguard the public.  Given the absence of any publicly documented harm resulting from consumer access to genetic tests , however, there are certainly those who would disagree, arguing that the FDA should still refrain from regulating DTC genetic tests.

Listening to Shuren’s remarks at the hearing, one could easily wonder whether his lament was actually directed at the agency having been caught off-guard, at least to a degree, by the debut of the GAO’s striking report, which was unveiled to the public – and the DTC companies themselves – at the hearing.  According to the report (pg. 19) the GAO officially briefed the FDA, NIH and FTC on the contents of the report in late May and early June. However, when I raised this point yesterday during an FDLI webinar on FDA’s (Emerging) Oversight of LDTs, fellow panelist Dr. Elisabeth Mansfield, Director for Personalized Medicine at CDRH, clarified that the GAO’s “briefing” consisted of a teleconference where the FDA learned only the bare fact that the GAO had conducted an inspection and had “found problems.”

Perhaps it is just a perfect storm of coincidences. But in any event, the FDA actions and the GAO report – along with other recent high-profile developments including the Pathway / Walgreens pairing and 23andMe’s “sample swap” – have created unprecedented uncertainty.

Today: Uncertainty Reigns. The GAO report, the FDA’s letters and all of the other events of the past few months have indisputably ratcheted up the level of uncertainty throughout the genetic testing industry.

However, as a purely legal matter, it does not appear that the formal regulatory framework governing DTC genetic testing has changed much if at all in recent months, or even since 2006, particularly at the federal level. Congress has passed no new legislation, and neither the FDA nor any other federal agency has promulgated new regulations or formal agency guidance.   This, of course, is not at all surprising: the rate of development in any new area of science and commerce inevitably surpasses the ability of lawmakers and regulators to keep pace. DTC genetic testing has hardly proved an exception to that rule.

Setting aside the myriad hearings, public and private meetings and statements made to the press by regulators – which, while significant, do not rise to the level of rulemaking – the only formal, public action one can point to is the FDA’s ongoing letter-writing campaign. However, as the FDA has clarified in the past, these “Untitled Letters” remain several steps removed from an FDA enforcement action:

While Warning Letters set out specific violations of law that a company must address immediately or else the agency will take an enforcement action, an Untitled Letter identifies agency concerns and gives a company the opportunity to meet with the agency and to have time to take appropriate steps to address these concerns….Based on how the companies respond to the Untitled Letters, FDA may follow up by sending Warning Letters.

Of course, an absence of documented regulatory change does not imply that the commercial DTC genetic testing landscape has remained anything close to stable.

Responses from DTC companies and investors to today’s uncertainty have varied. Some companies (including Pathway Genomics and Counsyl) have ceased offering their tests directly to consumers, at least for the moment. Others, including two original DTC genetic testing companies (23andMe and deCODE), have expressed a desire to work with regulators while continuing to make their products available to consumers. Many of the major DTC companies, whether or not they are currently offering products directly to consumers, have also criticized both the GAO and the FDA for their approach to DTC genetic testing (see these blog posts at Navigenics, 23andMe and Pathway Genomics) while simultaneously expressing their desire to work with regulators to bring greater oversight to the industry.

Meanwhile, new companies and investors must reevaluate business plans to take into account anticipated regulatory changes.  And customers, including Mary Carmichael, must weigh the possibility that today’s DTC options may disappear from tomorrow’s digital storefronts.

Since 2006, the regulation of DTC genetic testing has been consistently characterized as confusing, incomplete and inconsistently applied. That characterization remains as true today as it was four years ago. So perhaps the only meaningful difference from four years ago is one of degree: more so than at any time over the past four years, there now appears to be a consensus that something must – and will – be done to overhaul the regulation of DTC genetic tests.

Tomorrow: Unintended Effects (and More Uncertainty). But not so fast. Despite the apparent agreement among regulators, industry and most commentators that DTC genetic testing is in need of additional oversight, there is still no guarantee that change is coming soon, or even at all.

Indeed, it is not difficult to look at the events of the past few months and conclude that DTC has been down this road before:

• A GAO report decrying the evils of DTC genetic testing and subsequent Congressional hearing? 2010 and 2006.
• Threatening regulatory letters to DTC companies? 2010 and 2008.
• A controversial FDA regulatory proposal that might – or might not – encompass DTC genetic tests? 2010 and 2006.

Industry watchers who have been around since the beginning would be excused for expressing at least some skepticism that this is the time, finally, when the DTC genetic testing landscape will be fundamentally remade.

Continuing Uncertainty. There is also the possibility that a new regulatory regime for genetic tests will emerge, but that it will push DTC genetic testing to the side and in so doing cause the industry to remain mired in uncertainty.

As the FDA pushes forward with the development of agency guidance for the regulation of LDTs, there are concerns that the agency may carve out many or most DTC genetic tests from this regulatory framework. In June, the FDA expressed its belief that several prominent DTC companies (23andMe, Knome and deCode) are offering tests that do not constitute LDTs because they are “not developed by and used in a single laboratory.”

Recent signals – including the designation of a separate panel for LDTs during the FDA’s two-day public meeting and Jeffrey Shuren’s presentation of DTC genetic tests within the confines of the larger LDT regulatory conversation (pdf) at the recent Congressional hearing – suggest that the FDA may yet find a way to incorporate the regulation of DTC genetic tests into its more ambitious plan to develop a risk-based approach for all LDTs. But for the moment, the FDA appears to be intent on continuing with test-by-test review and regulation.

Unintended Effects. Among its several shortcomings, the current test-by-test approach to DTC genetic testing regulation creates the possibility that a regulatory agency such as the FDA could seek to reshape the industry using indirect methods.

When the FDA sent out its first batch of letters post-Pathway, the one unexpected recipient was array manufacturer Illumina, which, unlike the other companies receiving letters, does not appear to have ever offered its services directly to consumers without the involvement of a physician intermediary. Nor did the FDA allege that it had. Instead, the FDA’s letter to Illumina (pdf) focused on the company’s “Infinium HumanHap550 array used by deCODE Genetics and 23andMe to provide genetic information to their customers.” The FDA charged Illumina with making available an array approved for “Research Use Only” to 23andMe and deCode for use in their own DTC genetic tests.

Why does this matter? As I wrote at the time, not every company has the same set of incentives to resist the FDA’s regulatory proposals. Whereas a company such as 23andMe, which has built its business around DTC genetic testing, has a clear interest in challenging any FDA action that results in its service becoming unavailable to consumers, array manufacturers like Illumina are not similarly situated. As Illumina’s CEO, Jay Flatley, recently noted, the revenue the company “generates from sales of arrays to the DTC market is ‘immaterial.’” By targeting array suppliers such as Illumina, for whom DTC represents only a fraction of their business, the FDA may have identified a way to exert indirect but potentially much more effective regulatory pressure over the industry.

In response, Daniel MacArthur asked yesterday whether the FDA was planning to strangle the supply lines of DTC genetic testing companies by targeting array manufacturers like Illumina. As a regulatory agency charged with implementing legislation passed by Congress, the FDA is extremely unlikely to have an official “agenda” when it comes to DTC genetic testing. That does not mean, however, that the FDA could not determine that genetic testing simply cannot be paired with DTC and still satisfy its interpretation of the law.

If 23andMe or deCode (which is partially owned by Illumina) were to lose access to Illumina’s arrays, would those companies be able to contract with another manufacturer, either based in the U.S. or abroad? Would Illumina take the necessary steps to work with 23andMe and the FDA to clear its array for use in 23andMe’s product? Would this development force such a fundamental shift in the business models of these DTC companies that they would be driven out of business, or perhaps driven overseas?

Even as a hypothetical, the Illumina example illustrates the importance of considering the knock-on effects of regulation. Although the FDA may take the position that its goal is to enforce agency regulations regardless of the effects they produce on a specific business, or even an entire industry, the reality is that there are a number of viable regulatory strategies on the table, and not all of them are equal in their effects.

One of the unfortunate consequences of the test-by-test regulation currently employed by the FDA is that these effects are unlikely to be fully anticipated or explored in advance by regulators. By the same token, one obvious advantage of publicly pursuing a formal system of regulation for DTC genetic testing – e.g., through the development of agency guidance or notice and comment rulemaking – is that such regulatory effects can be explored in advance (in some instances this may even be required of the FDA), rendering them at least intended, even if they remain unwelcome to some.

Other Regulatory Routes. Finally, remember that the FDA may not be left entirely to its own devices in determining how to regulate either LDTs or DTC genetic tests. Several pieces of draft legislation, if enacted, could provide specific Congressional direction as to how the FDA or other regulatory agencies should respond to the challenges raised by these tests.

Current proposals include the Genomics and Personalized Medicine Act – originally introduced by then-Senator Obama and now in its fifth year on Capitol Hill – and the inelegantly named Better Evaluation and Treatment Through Essential Regulatory Reform for Patient Care Act.

The prudent approach – particularly for companies, investors and consumers with an interest in DTC genetic testing regulation – is to assume that some type of regulatory reform is coming to the industry. Unfortunately, important details like “what regulation” and “when will it arrive” continue to remain elusive.

Beyond: A Delicate Balancing Act. Assuming that lawmakers and regulators do decide to develop a formal DTC regulatory regime, the details will be a long time in coming. Stakeholder input will be crucial, and the rapidly changing scientific and commercial landscape will continue to pose a challenge for slower-moving lawmakers and regulators.

Despite all of this uncertainty, it is yet possible to identify (i) several key areas of relative consensus for any prospective DTC regulatory framework and (ii) some of the most pressing areas of dispute that must be resolved in order to proceed.

The First Step: Defining DTC. Before we get to areas of consensus and dispute, however, a brief word about definitions. Any formal regulatory framework will need to set out a clear definition of what, exactly, constitutes a “direct-to-consumer genetic test.” As the personal genomics industry has grown increasingly diverse, the application of the label “DTC” to all consumer-oriented genetic products has become increasingly untenable.

There are, at the moment, at least three different types of DTC genetic tests:

• tests marketed to consumers but ordered and interpreted by a healthcare provider;
• tests marketed to and ordered by consumers but received and interpreted by or only in the presence of a healthcare provider; and
• tests marketed to, ordered by and received by consumers without any requirement that a healthcare provider be involved (although this option is frequently made available to consumers).

While the focus has frequently been on the third and most consumer-oriented type of genetic test, not all so-called DTC genetic testing companies fall into this category. This is significant since the risks – whether hypothetical or actual – of “DTC genetic testing,” as well as the appropriate regulatory response, clearly depend in large part on what exactly is meant by that term.

Finding Common Ground. Although few in number, it appears that consensus is emerging in certain areas pertaining to DTC genetic testing.

Access to Raw Data. Even those who strongly support the robust regulation of DTC genetic testing, agree that individuals should have the right to directly access their raw genetic data (pdf). In public and private comments, the FDA has appeared to embrace this position as well, indicating it is medical claims or interpretations – and not genetic information per se – that concerns the agency.

We need to be careful, however, to define exactly what this outbreak of agreement covers. Although important for what it says about an individual’s right to access their own genome, it likely refers only to the most basic level of access – a large file of As, Cs, Ts and Gs – and to nothing more. This is only a first step. Meaningful “access” for the vast majority of individuals begins only with the ability to access interpreted data.

Registration and Truth in Advertising. As the recent GAO report laid plain, there is a clear need for more robust regulation of the advertising and marketing practices of existing genetic testing companies, including DTC companies, to ensure consumers are not being intentionally or even accidentally misled.

Addressing this issue requires a thorough understanding of the tests currently offered to consumers, including how they are marketed or advertised, how they are intended to be used, and how they are actually used. The FDA has acknowledged several times in public discussions, including yesterday, that the agency lacks this information and that it would be useful in developing appropriate regulations.

While there remains some disagreement over the proper agency or agencies to collect this information and to take appropriate enforcement actions where necessary (the FDA and the FTC have both demonstrated some interest, and the NIH is currently developing a genetic testing registry), there is widespread agreement that these steps should be taken, and soon.

Industry-Wide Standards. Finally, almost since the inception of DTC genetic testing in 2007, there has been a widespread recognition that the industry would benefit from a more standardized approach to interpreting and reporting genetic data.

Early efforts led by the Personalized Medicine Coalition to produce industry-developed standards have stalled, but the inconsistency demonstrated by Collins, Venter et al. and most recently the GAO report have resulted in renewed interest from industry and regulators in addressing this issue.

Here, again, it is important to acknowledge the limited scope of this consensus. There is real agreement that standards are needed. The development and application of those standards, however, raises a host of questions, some of which are discussed below, to which there are hardly consensus answers.

Resolving Disputes. Beyond the few but important areas of consensus described above, it is certain that any emerging regulatory framework will have to tackle numerous difficult questions about which there is a decided lack of agreement. While it is impossible to list all of the areas of disagreement, some of the most pressing issues are:

• whether genetic tests should ever be offered directly to consumers without the involvement of a trained intermediary such as a physician or genetic counselor (i.e., should the third type of DTC genetic testing described above disappear);
• whether to create separate standards for non-clinical genetic tests, including genetic ancestry testing, and how to appropriately define the line between clinical and non-clinical tests;
• how to regulate genetic tests or products that include a large number of interpretations and claims in light of the need to constantly update those claims to best reflect current scientific understanding;
• whether clinical utility, or lack thereof, should be included in determining whether a particular genetic test or association is made available, whether DTC or otherwise;
• how to regulate interpretative tools that do not involve any new testing, but simply offer additional interpretations of raw genetic data already in a consumer’s possession;
• how to address the role of preliminary scientific findings and research in the development of interpretive tools, including genetic tests; and
• whether to focus regulatory efforts on pre-test measures that restrict the availability of potentially harmful genetic tests or post-test initiatives designed to evaluate how consumers perceive, use and react to genetic tests.

The answers to these questions and others, as well as the role industry, consumers and healthcare providers are permitted to play in the conversation, will determine the substance of any forthcoming DTC regulatory framework.

Answering Mary’s Question: To Test or Not To Test? While tomorrow always carries the possibility of a new and clearer day for the regulation of DTC genetic testing, the reality is that, for the moment, all we can say for sure is that the conversation is continuing. What was true in 2006 is still true today: genetic tests are available for purchase directly by consumers, and the regulatory requirements imposed on the companies that offer those tests are unclear and seemingly poised to shift at a moment’s notice.

As I have written several times before, I am optimistic about the long-term prospects for personal genomics in the United States, including DTC genetic testing. As the underlying technology and science continue to improve, the price and value of individual-level genomic data will continue to move in opposite directions, generating increased demand. In time, as increasing demand leads to increasing accessibility and, ultimately, to increasing familiarity – on the part of both consumers and regulators – the development of a tailored system of oversight that permits direct access while adequately protecting consumer safety and ensuring the accuracy and validity of DTC products can be developed.

But none of this will happen overnight. For all of our own interest, DTC genetic testing remains decidedly a niche phenomenon, and the industry poses novel and difficult challenges to regulators. It will take time for these to be ironed out and, in the short-term, it is possible that DTC genetic testing will be presented with a substantially more restrictive regulatory framework than at present.

Ultimately, while I cannot advise Mary Carmichael as to whether she should or should not go through with a DTC genetic test – that’s a personal decision – I can say that if she decides to proceed there is no time like today, for there is no guarantee that the option will still be on the table tomorrow.

_______________

¹The regulation of DTC genetic testing is far from uniform at the international level. Some countries, including Germany, appear to have effectively legislated DTC genetic testing out of existence, at least for the time being. Elsewhere, most notably the U.K., the conversation remains at the level of voluntary guidelines instead of formal – or even informal – regulation. Recent examples include the 2009 House of Lords report on genomic medicine and yesterday’s publication by the Human Genetics Commission of “A Common Framework of Principles for direct-to-consumer genetic testing services” (pdf).

In letters dated July 19th, the first day of the FDA’s public LDT meeting, the Agency continued its crackdown on direct-to-consumer (DTC) genetic test providers, mailing letters to 14 providers of genetic tests. A list of all 14 companies and tests appears below.

The Letters. The letters are similar to the five untitled “letters to industry” the FDA sent out in early June to 23andMe, Navigenics, deCODE Genetics, Knome and Illumina. While briefer than the earlier letters, the new batch of letters reach the same conclusion: each of the companies is marketing a genetic test that, according to the FDA, meets the definition of a “device” under Section 201(h) of the Federal Food Drug and Cosmetic Act (FFDCA). Therefore, each test must receive FDA clearance (510(k)) or approval (PMA). Not surprisingly, the FDA “conducted a review of [its] files” but was “unable to identify any [such FDA] clearance or approval” for any of the tests. The companies are asked to respond to the FDA within 15 days.

By comparison, the June 10th DTC letters were lengthier and also contained (1) information regarding the specific devices/products identified as problematic by the FDA, (2) a recitation of the FDA’s authority for premarket regulation of medical devices under the FFDCA and (3) a description, in most cases, of a prior meeting between the company and the FDA. The June 10th letters also urged the companies to “take prompt action to respond” to the letter, instead of setting out a definite timeframe.

The other notable difference between the two sets of FDA letters is who signed them. The June 10th letters were signed by Dr. Alberto Gutierrez, Director of the FDA’s Office of In Vitro Diagnostic Device Evaluation and Safety (OIVD). The July 19th letters, on the other hand, were signed by OIVD Deputy Director James Woods. It appears that over the last month OIVD and Dr. Gutierrez have gained sufficient comfort with their letter-writing campaign to push the task down the chain of command.

The Tests. Here is the list of all 14 companies who received FDA letters dated July 19th:

• Graceful Earth Inc. Concerning the Graceful Earth Alzheimer’s Test
• SeqWright DNA Technology Services, Inc. Concerning the SeqWright Genomic Profiling Service (GPS)
• Interleukin Genetics, Inc. Concerning the Inerent [sic] Health
• DNATraits Concerning the Ashkenazi Jews Genetic Disease Panel
• CyGene Direct™ Concerning the Metabolic Health Assessment DNA Analysis Test
• Consumer Genetics, LLC Concerning the AsthmaGEN DNA Test
• Matrix Genomics, Inc. Concerning the Matrix Genomics Breast Cancer Panel
• The Genetic Testing Laboratories, Inc. Concerning The Genetic Testing Laboratories DNA Predisposition Test
• Sequenom, Inc. Concerning the SEQureDx™
• EnteroLab Reference Laboratory Concerning the Gene Test for Gluten Sensitivity/Celiac Sprue
• BioMarker Pharmaceuticals, Inc. Concerning the Gene Essence™
• DNA Dimensions Concerning the Predisposition DNA Test
• HealthCheckUSA Concerning the HealthCheckUSA Celiac Disease DNA Test
• easyDNA Concerning the Genetic Predisposition Health Test

Most but not all of these tests appear to be offered for sale directly to consumers. All appear to be marketed DTC. For some tests it can be difficult to tell. For instance, while Matrix Genomics’ breast cancer test can be purchased directly online, I was unable to find a way to order DNA Dimensions’ “Concerning the Predisposition” test through the company’s website, although the company does have a Facebook page. Other products, such as Sequenom’s SEQureDx™ test which, according to the FDA (pdf), measures “circulating cell-free fetal (ccff) nucleic acids (RNA or DNA) in a pregnant woman’s blood sample for fetal gene and chromosome abnormalities, do not appear to be available for purchase without a physician’s involvement.

The range of tests and test providers makes it impossible to determine why or how the FDA selected these particular tests for the current round of letters. Matrix Genomics, for instance, also offers Alzheimer’s, Heart Attack, Warfarin, Plavix and Parkinson’s tests. The FDA’s letter, however, only mentioned its breast cancer panel. And even with these 14 additional letters, as I wrote last time, there are still dozens – and possibly more – of genetic tests marketed and sold directly to consumers that have not been identified by the FDA. The Genetic and Public Policy Center’s (GPPC) recently updated chart of DTC genetic testing companies (pdf) lists 30 companies, and similar lists from AccessDNA and DNA Test Index include dozens more.

What’s more, as with the case of Sequenom, it’s not clear that the test is being offered directly to consumers. If that’s the case, and the FDA has moved on from sending letters to DTC genetic testing providers to sending letters to providers of more traditional LDTs, then the FDA has thousands of potential letter recipients to choose from at GeneTests.org. [Update: Kirell Lakhman of GenomeWeb's The Sample writes that Sequenom was the only non-DTC genetic test maker of the 14 and, what's more, "Sequenom hasn't even begun selling the assay. In fact, the company is still collecting clinical samples for studies..."]

More than a month after the first five DTC letters went out, and in the immediate aftermath of the FDA’s public meeting, companies, consumers, healthcare providers, investors and the general public remain largely in the dark about the factors the FDA is using to determine which tests and test providers to target. Is it a test’s intended use? The fact that it is marketed DTC? The fact that it is sold DTC? The complexity of a particular test? The perceived or actual lack of analytical validity, clinical validity and/or clinical utility? Any or all of those factors, as well as numerous others, might be influencing the FDA’s activity in this area. Until the FDA offers up a general policy for public review – and hopefully for comment as well – there is no way for anyone outside of the Agency to know where the FDA might be headed next. For the moment, at least, it appears that company-by-company, test-by-test letter mailing continues to be the Agency’s preferred approach.

The Timing. During the FDA’s two-day public meeting earlier this week, the Agency repeatedly emphasized that its policy with respect to the regulation of LDTs – including DTC genetic tests – had not been finalized. That was, after all, one of the primary purposes of the meeting: to “serve as a forum to discuss issues and stakeholder concerns surrounding LDT oversight.” The meeting even included an entire session devoted to DTC testing, in which participants were invited to discuss the risks and benefits of DTC genetic tests.

On the topic of the FDA’s willingness to listen to the LDT community, here is what I wrote after the first day of the meeting.

Openness. One reason that a fully articulated regulatory policy is unlikely to emerge from the FDA in short order is that the Agency appears strongly committed to gathering stakeholder input and developing regulations that respond to that input. This is a standard talking point for any regulatory agency, and with numerous conflicting opinions over whether and how the FDA should regulate LDTs, it is obvious that the Agency will not satisfy every stakeholder. Still, I was struck by the Agency’s commitment—in both private and public conversations—to understanding the issues and keeping an open mind about how to proceed. There seemed no reason to doubt Dr. Mansfield when she said that when it comes to LDT regulation, “nothing is set in stone; we have not made any decisions.” This only serves to underscore the importance of participation in the regulatory process which, if attendance at this meeting is any indication, is a strategy that the LDT community has embraced. (emphasis added)

The July 19th letters certainly seem to give the lie to the Agency’s position, including Dr. Mansfield’s comments, that nothing is set in stone when it comes to LDT regulation.

The FDA’s policy with respect to DTC genetic tests, while far from clear, certainly seems to be moving ahead unchanged, public meeting or no. The timing of the letters, which were mailed the same day as the meeting began, suggest that the FDA had no intention of revisiting its decision to step up oversight of DTC genetic tests, no matter what might have been said on Monday and Tuesday.

So what are we to make of the timing of the timing of the FDA letters?

On the one hand, as was pointed out by the Agency after the previous round of letters, these are untitled “letters to industry” and are less severe than a formal FDA “warning letter.” The letters identify Agency concerns and give the named companies time to respond. (Depending on the response, or lack thereof, the FDA may follow up with warning letters down the road.) The letters also subject other lesser-known DTC companies to FDA scrutiny similar to that received by the companies named in the June 10th letters, although, as mentioned above, that level of scrutiny is hardly industry-wide at this point. It is possible that the FDA is slowly but surely identifying DTC (and select other) genetic tests that it believes are particularly problematic, and mailing out standardized letters as it does so. It is possible that the timing is largely coincidental.

On the other hand, coincidence or not, it is difficult to believe that the timing of the FDA’s latest letters won’t provide significant fuel for those who believe that the Agency has already made up its mind about how it intends to regulate LDTs – including DTC genetic tests – and that the two-day public meeting was simply window dressing to help bolster the Agency’s defense against any future challenges to its soon-to-be-enacted regulatory policy.

While I continue to think that the FDA is indeed listening to the LDT community as it develops its regulatory strategy – if for no other reason than that the topic is so complex that the FDA is unlikey to sort out all of the details quickly, or on its own – this latest development gives me pause. One of the many themes that emerged over the two-day public meeting was that the FDA will need assistance and buy-in from regulated parties in order to effectively implement its new system of LDT oversight, whatever it may be. Allowing those stakeholders to have a say in the development of the FDA’s regulatory policy is an excellent way to secure that assistance and buy-in; but that strategy only works if the FDA can convince the LDT community that it is actually listening. Coincidental or not, the timing of this round of FDA letters is unlikely to help the Agency in that regard.

What’s Next. Three of the five companies named in the June 10th letters will be on Capitol Hill first thing tomorrow morning for a House of Representatives hearing on “Direct-to-Consumer Genetic Testing and the Consequences to the Public Health.” The House Committee on Energy and Commerce posted a briefing memo (pdf) for the hearing earlier today. The memo provides additional background information (including information about the GAO investigation, which apparently was initiated all the way back in March 2009) and includes a witness list.

In addition to representatives from Pathway Genomics, 23andMe and Navigenics, the GAO and FDA will be represented. Dr. James Evans of UNC-Chapel Hill, and a member of the SACGHS, will also testify. For those interested in following the hearings from afar, Andro Hsu has posted a link to a live webcast that will, hopefully, be active once the hearings begin.

None of the 14 companies recently named by the FDA have been invited to appear before the House, but that’s no guarantee that Congress won’t invite some or all of them to take their own trip to Washington at some future date.

What’s Next for DTC? In last week’s post, we outlined several possible responses available to DTC genetics companies, including (1) pulling products from market, (2) agreeing to comply with FDA regulatory requirements, (3) modifying products to avoid FDA oversight or (4) challenging the FDA’s regulatory authority over DTC genetic testing products. We also noted the possibility that the FDA’s decision to look more closely at DTC genetic tests could presage increased scrutiny of the genetic testing industry more broadly, including the many tests currently offered without FDA clearance or approval as laboratory developed tests (LDTs).

With the personal genomics landscape shifting seemingly on a daily basis, what should we expect to happen next? Will the FDA follow up last week’s letters with letters to additional personal genomics companies, continuing its current policy of case-by-case regulation? Will it announce some form of industry-wide guidance? Will one of last week’s lucky recipients reveal its response to the FDA? Will we hear more from the Congressional committee investigating DTC genetic testing, which sent out its own letters nearly a month ago, then followed those up yesterday with another letter to 23andMe?

While we wait to see what tomorrow will bring, those interested in forecasting future chapters in the ongoing DTC regulatory saga are advised to take a look back at the FDA’s most recent attempt to shape the regulation of genetic testing.

A Complex Debate. Four years ago the FDA touched off a similar regulatory controversy when it ratcheted up its oversight of a specific type of high-complexity LDT: the in vitro diagnostic multivariate index assay or IVDMIA. On January 23, 2006, in a letter that bears remarkably similarities to the one sent just last month by the FDA to Pathway Genomics, the FDA invited Genomic Health, Inc. to discuss with the agency the regulatory status of its Onco type DX test, a complex genetic test designed to predict cancer recurrence in certain breast cancer patients. The FDA’s letter to Genomic Health was followed in September 2006 by draft guidance (pdf) announcing the FDA’s intent to regulate the entire class of genetic tests it deemed to be IVDMIAs.

The FDA’s initial proposal to regulate IVDMIAs was criticized as being vague, overly broad and unduly burdensome for genetic testing laboratories. The intense criticism resulted in the FDA’s publication of a revised guidance document in July of 2007 (pdf). That guidance was no less immune to criticism, and resulted in the FDA placing the proposed regulatory change on the back burner. Although the FDA has periodically indicated that IVDMIA guidance is still on the table, including earlier this year, it has now been nearly three full years since the FDA last took a meaningful public step in the direction of regulating IVDMIAs. (And, as described in Genomic Health’s most recent 10-Q (pdf), the Onco type DX test remains free from FDA regulation, at least for the moment.)

Why IVDMIA Matters. The history of FDA’s attempt to regulate IVDMIAs matters because it is almost certain to inform the FDA’s current attempt to regulate DTC genetic tests, as well as any attempts by the DTC genetic testing industry to resist that regulation. Most DTC genetic tests have long been considered, just like IVDMIAs, to be LDTs subject to the FDA’s enforcement discretion. In its letters to 23andMe, Knome and deCODE, however, the FDA argued that these tests do not qualify as LDTs because they are “not developed by and used in a single laboratory.” Even if that distinction holds, and DTC genetic tests are not determined to be LDTs, there is plenty to learn from the FDA’s experience with IVDMIAs.

Challenging the FDA’s Authority. Of particular interest are two petitions filed with the FDA concerning the agency’s proposal to regulate IVDMIAs, and its broader authority to regulate LDTs as medical devices. The first petition, filed by the Washington Legal Foundation (WLF) in 2006 (pdf), shortly after the FDA’s initial IVDMIA guidance was proposed, challenges the FDA’s legal authority to regulate LDTs (including IVDMIAs) and argues that the FDA’s approach of case-by-case regulation and informal agency guidance violated the agency’s responsibilities under the Administrative Procedure Act (APA). The WLF petition builds on a similar petition filed by the law firm of Hyman, Phelps & McNamara, P.C. (HPM) in 1992 (pdf) which challenged the FDA’s original assertion that it possessed the authority to regulate LDTs, even as it noted that it intended to exercise enforcement discretion and refrain from LDT regulation at that time.

The HPM petition, which was finally denied by the FDA nearly six years later, and the WLF petition are countered by a 2008 petition filed by biotechnology company Genentech, Inc. (pdf). Genentech’s petition argues that not only does the FDA have sufficient legal authority to regulate LDTs, but that given the potential risks to patient safety the agency should regulate all genetic tests, including all LDTs, rather than limiting its regulatory oversight to IVDMIAs.

If the FDA’s recent attempt to regulate certain DTC genetic testing products is challenged – whether by one of the five companies the FDA singled out or by some other third party – it is likely that many of the same arguments appearing in the HPM, WLF and Genentech petitions will reappear. In particular, questions about FDA’s authority to regulate these products, especially its ability to do so without undertaking notice and comment rulemaking pursuant to the FDA, are almost certain to play a prominent role. (As Kirell Lakhman of The Sample reported earlier this year, the need for APA-compliant rulemaking may be the reason that FDA’s proposed IVDMIA guidance remains on hold.)

While we can predict with some confidence what a challenge to the FDA’s authority to regulate DTC genetic tests might look like, it is far more difficult to predict whether such a challenge will ever actually be brought, let alone succeed. Such a regulatory challenge would be time-consuming and expensive – for both the challenger and for the agency – and, should it proceed into the courtroom, would be stepping into the relatively uncharted territory of consumer genetic testing.

A fight that entails such considerable expense and uncertainty is not one that any DTC genetic testing company will be eager to initiate. Still, for the companies and investors most directly threatened by the FDA’s recent activities, the history of the LDT/IVDMIA debate – and especially the regulatory silence that has followed – may be impossible to ignore.

Below, we will discuss the immediate and long-term implications of the FDA’s most recent regulatory actions for the five companies receiving letters, as well as for the DTC genetic testing industry. First, however, a review of the letters themselves is required. Each of the five two-page letters is signed by Alberto Gutierrez, Director of the FDA’s Office of In Vitro Diagnostic Device Evaluation and Safety (OIVD), and follows a similar format throughout. To gauge the impact of these letters we will take them paragraph by paragraph.

1. The Devices in Question. Each letter begins with a description of the product the FDA has determined qualifies as a device under Section 201(h) of the Federal Food, Drug and Cosmetic Act (FDCA). Section 201(h)(2) of the FDCA defines “device” as:

an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is…intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals

The agency’s letter focuses in on the second half of the 201(h)(2) definition, and adds in language from 201(h)(3) which allows the FDA to categorize products as a device if they are “intended to affect the structure or any function of the body of man.” The “devices” identified by the FDA are: 23andMe Personal Genome Service™, Navigenics Health Compass, deCODEme Complete Scan, KnomeComplete™ and the Illumina® Infinium HumanHapp 550 array. It’s difficult to see how any of these products would fall under 201(h)(3) but not 201(h)(2) but, regardless, the FDA is making a clear statement: based on the plain language of the FDCA, it considers these products to be medical devices.

2. Has Your Doctor Seen This? The second paragraph, which appears to be identical in every letter, is a generic overview of the Medical Device Amendments (MDA) to the FDCA. The MDA grants the FDA the authority to require premarket regulation of medical devices. The letter stresses the importance of demonstrating both analytical and clinical validity to ensure that “individuals are not misled by incorrect test results or unsupported clinical interpretations” and that the products are “used to support good healthcare decisions.”

We wrote earlier this week about the difference between analytical and clinical validity, and the role that CLIA (which is administered by CMS, not the FDA) is meant to play in ensuring the former. The letters clearly indicate that the FDA has its eye on both measurements of genetic test quality, as it should. More significantly, the letters appear to indicate that the agency considers the products in question to provide “clinical interpretations” and/or to be used in “healthcare decisions.” In the long-running debate over whether DTC genetic testing qualifies as clinical medicine, it appears that the FDA may have come down on the clinical side of the fence, at least for these particular products.

In fact, Director Gutierrez clarified this point in an interview this afternoon with Newsweek. Director Gutierrez seemed particularly concerned with products that report on genetic variants related to drug metabolization:

If you’re making a claim about [a genetic variant that affects the metabolism of the anticoagulant drug] warfarin, and somebody decides based on the result they get that they want to change their dosing, that is a fairly risky decision. That could affect their health. If they’re not feeling well on their current dose and the drug is expensive, we don’t know what they would do.

These concerns are reiterated, albeit in less detail, in several of the actual letters (see next paragraph).

3. Where’s the Approval? The third paragraph in four of the five letters informs the company that the FDA has not received any information pertaining to the analytical or clinical validity of the products for use in the FDA’s “clearance or approval” of the products. The letters go on to describe the type of genetic information provided by the companies that is of particular concern in this regard, for example the warfarin and clopidogrel response information reported by 23andMe and Navigenics and the breast cancer risk and detection information provided by deCODE. The FDA, echoing Gutierrez’s comments above, warns that “consumers may make medical decisions in reliance on this information.”

The use of the word “consumer” is an interesting choice, particularly in light of the focus that the FDA is clearly placing on the potential clinical use of the products. It is particularly confusing in certain letters, 23andMe’s for instance, where the recipient of the genetic information is referred to in the same paragraph as both a “patient” and as a “consumer.” Clearly, one task for the future regulation and description of genetic testing products will be to clean up the terminology.

It’s also important to point out that Illumina receives special treatment in this paragraph. Of all the companies receiving letters, Illumina is the only one not to offer at least one product directly to consumers (the company does offer a commercial whole-genome sequencing service, although that product requires the participation of a healthcare professional). Illumina’s letter notes that the company has “received FDA clearance or approval for several of its devices,” but not for the HumanHap550 array. “Yet Illumina is knowingly providing the HumanHap550 array to 23andMe and deCODE Genetics for clinical diagnostic use without FDA clearance or approval” despite its being labeled “For Research Use Only.” As Gutierrez notes, “…Illumina has to follow the law, and they are aware that the chips are not being used for research only.”

Again, it appears that the FDA’s determination that the products are being used for clinical diagnostic purposes and delivered directly to consumers appear to be important factors, with the FDA drawing no enforcement distinction between enabling DTC genetic testing and providing the DTC genetic tests themselves.

4. We Know What You Said Last Summer. All but one of the letters then go on to describe a meeting last summer between the company in question and the FDA (July 29th for 23andMe, July 31st for Illumina, August 6th for Knome and August 13th for deCODE.) Surprisingly, there is no mention of a Navigenics / FDA meeting although, in part due to this paragraph’s conspicuous absence from the Navigenics letter, I wonder if this may have been an inadvertent omission.

During these summer meetings the companies presented information about their products to the FDA. On the basis of that information, as well as other available information (e.g., the FDA notes that 23andMe has “recently begun distributing the collection kit for your device through a third party distributor, Amazon.com”), the FDA has concluded that the products in question are diagnostic devices subject to FDCA regulation.

In its letters to 23andMe, Knome and deCODE, the agency goes on to explain that, since the products are “not developed by and used in a single laboratory,” it does not consider them to qualify as laboratory developed tests (LDTs). This is an important point because the FDA has long exercised “enforcement discretion” over LDTs, choosing generally not to regulate this category of test, one which includes a majority of currently available genetic tests. Since so many genetic test providers – not just those of the DTC variety – have relied on the LDT determination as a basis for skirting FDA regulation, this section in particular is likely to raise the blood pressure for companies that purport to offer one or more LDTs but do not conduct all of their development, testing and interpretation in house.

5. Where is Your Letter? Next is a paragraph, nearly identical across all five letters, that reminds the companies they have not received what FDA believes to be the necessary regulatory approvals. Or, as the agency puts it, “we are not aware that you have an approved application for premarket approval (PMA) in effect pursuant to” the FDCA, nor have you “notified the agency of your intent to introduce the device into commercial distribution as required by section 510(k)” of the FDCA.

Briefly, the FDA regulates medical devices in three classes.

Class I devices are simple devices that pose a minimal risk, and are generally exempt from FDA premarket approval or clearance. However, registration of the device is required (as is true of all FDA regulated devices).

Class II devices represent an intermediate level of risk, and require regulatory clearance (as opposed to an “approval”) before they can be sold in commerce. The FDA must determine that the “device to be marketed is as safe and effective, that is, substantially equivalent (SE), to a legally marketed device not subject to premarket approval.” The clearance track for Class II devices is set forth in section 510(k) of the FDCA.

Class III devices are the riskiest device class, and the products that receive the most stringent FDA scrutiny. FDA approval is required before the device can be sold in commerce, and is granted only when the FDA determines that there is “sufficient valid scientific evidence…that the device is safe and effective for its intended use.” The regulatory submission is substantially more detailed than under 510(k), and the FDA is not obligated to respond as quickly.

The FDA letters provide no real insight into whether the agency considers the products it has identified to represent Class I, Class II or Class III devices, a classification that will determine the size of the regulatory burden imposed by the FDA.

6. We Will Be Waiting. Finally, the FDA advises each company to “take prompt action to respond to this letter” and offers to meet with the company to “discuss whether there are tests you are promoting that do not require review by FDA…”

“Prompt” is not defined, and most or all of these companies have had open channels of communication with the FDA for some time now, so it is unclear what type of timetable this imposes. It is clear, however, that this is an invitation to further agency dialogue, and that these companies decline only at their peril.

The second part of the paragraph – the agency’s offer to “discuss whether there are tests you are promoting that do not require review by FDA” – strikes us as a possible opening, at least for some of the identified companies and tests. Last fall, 23andMe, following in the footsteps of its competitor (and recent FDA regulatory target) Pathway Genomics, announced that it was breaking up its genetic testing service so that it could offer separate products for customers seeking to explore their genetic ancestry but who were not interested in the more medical applications of personal genetics, or vice versa. (23andMe also offers a combined product that includes all of those features). As I wrote at the time, that is just the sort of distinction that might be significant to the FDA as the companies and the agency discuss which specific products require premarket clearance and approval (more on this below).

What Does It Mean For the Five Named Companies? The immediate implications of the FDA’s letters may be less significant than some might initially suspect. After years of speculation about whether and how the FDA would regulate DTC genetic testing products, the agency has now publicly delivered at least a partial answer: it considers these specific products to be medical devices requiring either premarket clearance or approval, and it does not consider them to be LDTs subject to regulatory enforcement discretion.

For the companies named in the letters, at least, this provides a concrete agency determination to which they can react. It’s unlikely that the response from any of the companies will be to pull their products completely off of the market and, as The New York Times reports, Director Gutierrez has indicated that “it would be unfair to remove the tests from the market because the agency had not, until now, clearly told the companies that the devices needed approval.”

[Added in Edit, 6/11: Turna Ray of Pharmacogenomics Reporter has published her own recap, which contains additional comments from Erica Jefferson, an FDA press officer. Jefferson's comments make a point of distinguishing the five untitled "letters to industry" from "warning letters." Jefferson explained the difference between the two types of letters:

While Warning Letters set out specific violations of law that a company must address immediately or else the agency will take an enforcement action, an Untitled Letter identifies agency concerns and gives a company the opportunity to meet with the agency and to have time to take appropriate steps to address these concerns...Based on how the companies respond to the Untitled Letters, FDA may follow up by sending Warning Letters.

Jefferson also added that the letters were sent based in part on recent discussions between the FDA and several of the companies that took place in the aftermath of the FDA's decision to send Pathway Genomics a similar letter last month. According to Jefferson, those meetings "helped inform the agency's decision to send the Untitled Letters." End Edit, 6/11]

So, at least for the moment, we may see little or no immediate change while these companies weigh their options internally and through discussions with the FDA. What exactly are those options? They obviously vary based on the specific company and product, but here are a few of the most likely possibilities:

Wave Goodbye. For products that have failed to meet expectations, or are no longer an integral part of the company’s future plans, one possibility is to simply pull the product from the market. The most likely candidate for this response would appear to be the deCODEme test, which is considerably more expensive and less popular than a number of its competitors. deCODE Genetics recently emerged from a well-publicized bankruptcy, and there have been hints that deCODEme might not be part of the reorganized company’s long-term plans. (However, in comments today to The New York Times, neither deCODE or its head of research, Kari Stefansson, indicated that they would do anything other than cooperate with the FDA). If deCODE or any other company does decide to pull its test from the market, existing customers will likely be anxious to know what will happen with their genetic data.

Say Hello (to the FDA). For other companies (e.g., Illumina, a company with considerable experience navigating the FDA approval process), the path of least resistance may be to simply agree with the FDA and seek the appropriate clearance or approval. The viability of this option will depend on how the FDA intends to categorize the specific product (e.g., Class I, II or III) and whether the company believes (a) it can bear the burden imposed by such a regulatory submission and (b) that its product will be approved without changes to its substance or commercial availability that would materially undermine the product’s commercial viability.

Change Pathways. Perhaps the most palatable option for many of these companies is to consider altering the product in a manner that would convince the FDA it no longer qualifies as a device requiring premarket approval or clearance, for instance by removing the ability of consumers to purchase the product without the participation of a healthcare provider.

In his interview with Newsweek, Director Gutierrez discloses that Pathway Genomics was not sent a letter yesterday because the company responded to the agency’s previous letter and has indicated that “they are planning to move away from direct-to-consumer testing…” While that disclosure is news to me, and not one I believe the company has made publicly (the website still appears to allow consumers to purchase directly), it is not a surprising one. As Gutierrez notes, another genetic testing company, Counsyl, made a similar decision in the aftermath of the Pathway / Walgreens commotion.

Of the five companies that received FDA letters this week, Navigenics and Knome would appear to be the most likely candidates to pursue this option. Navigenics has increasingly shifted its product focus over the past year in the direction of more traditional medical channels (as evidenced by its receipt earlier this year of a clinical laboratory permit from the State of New York, apparently the first awarded to a personal genomics provider), and this development could be the final nudge it needs to pull the plug on its DTC option. Similarly, Knome, which once offered whole-genome sequencing directly to the super-rich for $350,000, has increasingly positioned itself as a provider of genomic software and interpretation, with a focus on research and clinical applications. As with Navigenics, if Knome can forestall FDA regulation by eliminating all DTC versions of its products, it may have a strong incentive to do so.

A related approach, discussed above, would be for companies to seek different regulatory treatment for products that have clearly different uses. 23andMe, for instance, might seek a different classification for its ancestry testing product as compared to its products that provide genetic testing of a more arguably medical variety, such as disease prediction or drug response.

Prepare for War.  Finally, there’s always the possibility that one or more of the companies will challenge the FDA’s determination that they are either (a) offering a medical device or (b) not offering an LDT. There’s no question that going toe-to-toe with the FDA represents the path of greatest resistance, but if any of these companies feel sufficiently backed into a corner by the FDA’s approach this could surface as a viable option.

While no company has yet indicated its intent to challenge the FDA’s interpretation, 23andMe has thus far been the most outspoken in its criticism of the agency’s recent actions. As reported by The New York Times, one 23andMe director suggested that denying consumers direct access to their genetic information would be “appallingly paternalistic” (a characterization Director Gutierrez found inapplicable to the FDA’s regulatory decision), and the company has indicated that it “disagree[s] with the FDA’s conclusion” but is “open to discussion on ways to regulate the personal genetics industry.” Only time will tell whether 23andMe, or some other party, attempts to challenge the FDA’s regulatory approach to DTC genetic testing.

What Does it Mean for the Rest of the DTC Genetic Testing Industry? For the rest of the industry, the regulatory outlook is little clearer today than it was yesterday. The FDA has offered specific regulatory determinations for a limited set of DTC genetic testing products, but it has not offered broader industry guidance.

From the letters, and from Director Gutierrez’s statements, it is clear enough that the agency considered several important factors in identifying these five specific companies and products as regulatory targets. These include the DTC availability of the product (or, in the case of Illumina, contribution to DTC availability), the perceived medical use of the product and, in all likelihood, the complexity of the testing and interpretation involved in the product.

But how the FDA weighed those factors against others – including the utility of the tests, the reality of its limited regulatory resources, and the presence of numerous other genetic tests offered to consumers and to patients – remains unclear. Keep in mind that the FDA sent letters to five companies that, while they represent some of the best known genetic testing providers, do not comprise the entire DTC genetic testing industry (see, for example, this list at DNA Test Index or this list at AccessDNA). For other DTC companies, as well as companies and investors seeking to break into the DTC marketplace, there continues to be a lack of clarity into the FDA’s DTC genetic testing regulatory strategy.

For that reason and others, my own opinion continues to be that transparency – and not regulation – is what would be most beneficial to the DTC genetic testing industry and its customers at this time. Until companies, consumers and regulators better understand the tests that are available and, importantly, how those tests are being used, it will be difficult to develop a regulatory policy that protects the health and safety of individuals without stifling commercial innovation and individual exploration. In the meantime, expect the FDA’s latest actions – as well as, possibly, the ongoing Congressional investigation – to significantly shake up the personal genomics landscape in the coming weeks and months.

For those who missed the GET Conference, several high quality recaps are available. The most detailed is A Day Among Genomes, by Carl Zimmer of Discover’s blog The Loom. More targeted reflections on the conference and related events come from Emily Singer of Technology Review summarzing key trends highlighted by the genome pioneers (Singer also has a related piece on the difficulties of understanding human genomes), David Dobbs of Neuron Culture on genomes, cool conferences, and what the hell to tell people about behavioral genes, and Turna Ray of Pharmacogenomics Reporter on the recent Myriad Genetics decision, and its impact on the business of patenting genes. If you’d like even more detail, the Twitter community provided real-time play-by-play.

While there’s no need for a further summary, the GET Conference does provide an occasion to look at the evolving personal genomics landscape in a more holistic fashion.

Genomes GET Personal. Personal genomics refers to the generation and delivery of an individual’s genomic or genetic information. The data itself ranges from testing a single base (referred to as a single nucleotide polymorphism, or SNP) to attempting to sequence each of the approximately six billion bases that make up a human genome. Data generation occurs on a variety of platforms, but it takes more than data to make genomics personal. We must move beyond merely inexpensive genomics to truly personal genomics. That requires analysis of the data, linking it to the life of the individual donor, and, ultimately, using the data in some fashion.

For those of us who frequently read and think about such topics, it’s easy to develop a slightly myopic view of the significance of personal genomics. For example, as Carl Zimmer noted in his review of the GET Conference, it was a challenge to evaluate personal genomics critically “in front of an audience made up of genome scientists, people from the biotech sector, venture capital folks, and other assorted people who are, shall we say, already in the genomic tank.”

The reality is that, to date, personal genomics has been the province of a comparative few. Academic researchers, a fraction of healthcare patients supported by too few providers conversant in clinical genetics, and a handful of companies, entrepreneurs and early adopters striving to deliver genetic information to consumers outside of the clinical setting. But the rest of the world – including a majority of consumers, patients, healthcare providers and payors – is waiting in the wings.

With the cost of generating genomic data dropping, and their possible uses expanding, personal genomics is poised to enter the mainstream. When that happens, certainly by the end of this decade, and possibly far sooner, what will the personal genomics landscape look like? To put it another way, what are the channels or pathways through which ordinary individuals – those of us who are not geneticists or early adopters – will explore their own genomes?

Personal Genomics Pathways. The first step in answering that question is to sketch the personal genomics landscape as it exists today – to understand the pathways through which individuals are currently entering personal genomics.

The following sections outline four different categories of personal genomics: clinical, consumer, research and unintended. Delineating these categoris is not an easy task, and there are frequent examples of companies or technologies that reside in more than one of these four categories. Nevertheless, as the field continues to evolve, mapping the “big picture” can facilitate more precise dialogue, regulatory actions and commercial predictions.

Research. Genomic research is distinguished from the categories described below by its intended use (to improve our understanding of the genetic bases for complex human diseases and traits). But it is important to note that not all genomic research is personal genomic research. This is due to the fact that, in most research settings, genomic information flows in only one direction: from the individual to the researcher. Even aggregate research findings, let alone individualized data, are rarely returned to volunteer participants. Thus, despite the explosion over the past five years of genome-wide association studies (GWAS) and, more recently, the construction of large-scale genomic databases (including the UK Biobank and the Kaiser Permanente Research Program on Genes, Environment, & Health), the vast majority of genomic research does not qualify as personal genomic research.

This is partly due to a timing delay. The proliferation of individual-level genomic research data is a relatively new phenomenon, and research norms have been slow to adapt to a growing body of evidence suggesting that people are interested in learning the results of research carried out using their DNA, and that it is ethical for researchers to return such results. It also reflects some legal uncertainty, specifically whether research conducted (in the United States) in non-CLIA environments can be returned directly to participants without violating federal law. Driven by increasingly vocal calls from both research participants and researchers themselves – including several commentators in the GLR’s What ELSI is New? series – the government agencies that supply the bulk of the funding for genomic research are continuing to examine the issue of genomic data-sharing in the research context.

For the moment, the number of individuals participating in personal genomic research is on the rise. At the GET Conference, George Church provided an update on the Personal Genome Project, which is using unique informed consent protocols to build a research cohort of 100,000 individuals who will have the opportunity to actively participate in personal genomic research, and who will have direct access to their individualized genomic sequence information. The first ten participants (the “PGP-10”) have already made their data available online.

There have also been attempts to develop DTC genomic research initiatives and, while the yields so far have been modest, the model is an intriguing one that promises to involve increasing numbers of individuals in the research aspect of personal genomics.

Clinical. One of the key drivers of the personalized medicine movement is clinical personal genomics. It is defined by its application of genomic data (to clinical care) and its mode of delivering that data to the individual (through a licensed healthcare provider). Extremely wide-ranging, clinical personal genomics has the potential to integrate individualized genetic or genomic information into nearly every aspect of patient care.

Clinical personal genomics includes genetic testing for autosomal dominant genetic traits (e.g., Huntington’s disease), diagnostic testing to predict the likelihood of the development or recurrence of a disease with a known genetic component (e.g., breast cancer) and carrier testing for prospective parents concerned about passing on genetic traits (e.g., cystic fibrosis) to their children. (Arguably, reproductive personal genomics – including carrier testing and other reproductive technologies, such as prenatal testing and pre-implantation genetic diagnosis (PGD) deserve their own category but, since such services are typically offered under the supervision of healthcare providers, they are considered clinical personal genomics in this post.) Clinical personal genomics also involves testing for genetic variants that influence whether and how certain therapeutics will behave in an individual patient, often referred to as pharmacogenetics.

Providers of clinical personal genomics include numerous laboratories offering either FDA-approved genetic testing “kits” or laboratory developed tests (LDTs) (which are not currently regulated by the FDA) targeted at specific genes (as well as at other biomarkers). In addition to the companies that supply the tests or kits, clinical personal genomics also requires genetic counselors, clinical geneticists and other healthcare providers capable of helping patients to understand and act on their genomic data.

A pair of recent announcements by CVS Caremark (acquiring a majority stake in Generation Health) and Medco (acquiring DNA Direct), the country’s two largest pharmacy benefit managers (PBMs), suggest that personal genomics is primed to play an increasingly prominent role in the delivery of medical care. However, there is broad-based concern that there are insufficient numbers of trained healthcare professionals, especially genetic counselors and primary care providers with an adequate understanding of genetics, to handle the expected increase in patients seeking, or needing, clinical personal genomics services.

Consumer. Also referred to as direct-to-consumer (DTC) genomics, the distinguishing features of consumer personal genomics are its intended use (informational, educational or recreational, but not clinical) and its mode of delivery (directly to the consumer, without the requirement of a licensed intermediary).

Consumer genomic services run the gamut from genealogy (Ancestry.com), to paternity (Paternity Experts) to genetic matchmaking (Scientific Match), and everything in between. While some consumer personal genomics services are both popular and uncontroversial (ancestry testing) or are clearly niche products (MyRedHairGene.com), others have straddled the line between consumer and clinical personal genomics, creating confusion for consumers, healthcare professionals and regulators alike.

As an example, 23andMe tests more than half a million SNPs and reports back information relevant to more than 130 traits and conditions, many of which appear unambiguously aimed at influencing their customers’ clinical or medical decision-making. 23andMe also offers a popular genetic genealogy service, and has repeatedly expressed an interest in using its customers as the basis for a personal genomics research platform. What results is a single company with multiple overlapping products that could easily be viewed as a hybrid of the clinical, consumer and research personal genomics types.

What keeps companies like 23andMe in the consumer personal genomics category, at least for the time being, is an insistence on direct-to-consumer access. With a few important exceptions (e.g., New York and Germany), individuals worldwide can purchase and use these services without the involvement of a healthcare provider.

With the list of DTC providers growing rapidly, it can be difficult to keep track of everything that is out there. At present, the only publicly accessible registries of DTC providers are maintained by private entities, including AccessDNA, DNA Test Index, and the Genetics & Public Policy Center (pdf) at Johns Hopkins University.

Recently, however, the NIH launched a new genetic testing registry (GTR) which has the potential to serve as a more comprehensive resource for tracking DTC genomics services. The GTR, which will include providers of both clinical and consumer personal genomics services, is not yet operational. Listing in the GTR is also voluntary so, even once it is in place, it is unlikely to serve as a comprehensive directory of all consumer personal genomics services. There are reports, however, that Representative Patrick Kennedy is attempting to revive the Genomics and Personalized Medicine Act in a form that would include a mandatory genetic testing registry.

Of all of the personal genomics categories listed here, consumer services is the one most likely to rapidly splinter into multiple categories. At the moment, there are few regulations that deal directly with DTC genomics companies and the services they provide. As the generation of genomic data becomes increasingly inexpensive and commonplace, the spectrum of consumer services will expand considerably. As was true of the development of personal genomic research norms, regulatory activity in this area has lagged commercial and scientific development. At some point, however, additional regulations will arrive, helping to further define this category. For instance, it is possible that the GTR will serve as a precursor to a more comprehensive system of regulation for genetic testing. Additional regulation, whatever its impetus, would likely produce further fragmentation within this category, with some companies sliding into defined regulatory boxes and others changing their offerings to avoid regulatory control (and expense).

Predicting precisely which consumer services will be offered and how, if at all, they will be regulated, is impossible. All we know is that personal genomics consumers ten years from now are certain to have many, many more options than they do today.

Unintended. This final category is a catch-all, characterized by a single shared feature: these individuals did not intentionally confront their personal genomic information. At the Genomics Law Report, we have discussed a variety of ways in which an individual might receive an unintended, and possibly unwanted, introduction to personal genomics. Paternity identification, surreptitious testing, genetic testing of a first-degree relative, forensic activity and the re-identification of previously de-identified genetic information all have the capacity to introduce unsuspecting individuals to their genetic information. It’s also possible that individuals who have agreed to share or to explore only certain aspects of their genetic information will be unexpectedly presented with personalized genetic information beyond the originally intended scope of their agreement. No doubt there are other means of unintended exposure as well.

While not every unintended exposure to personal genomic information will be undesirable, such occurrences should clearly be minimized. Although the GET Conference featured a self-selecting audience largely enamored of personal genomics, not every individual shares the desire to peer deeply, or at all, into his or her own genome. An introduction to personal genomics, no matter the context, should be expected, if not always desired (e.g., certain clinical testing), with ample opportunity afforded for pre-test education and, where necessary, informed consent.

Unfortunately, as the cost of generating individualized genomic data declines, more and more such data will be generated. The proliferation of personal genomic data, and the increasing array of valuable applications of such data, is likely to increase the incidence of unintended personal genomics exposures. A combination of public education and policy and legal reforms will be needed to minimize the number of such events and mitigate their impact when they invariably occur.

The Future of Personal Genomics. The categories described above are roughly drawn, and they may well be incomplete. There is no question that they are neither exclusive nor exhaustive. All we really know is this: to the extent that they accurately reflect the current personal genomics landscape, they will not do so for long.

Genomic researchers with novel questions will continue to require novel, and increasingly participatory, research models. Clinical practice will grow and is likely to become simultaneously more specialized (e.g., increasing availability of genetic diagnostic tests) and more generalized (e.g., incorporation of whole-genome sequences into medical records as a default). Consumer personal genomics will go wherever the entrepreneurial imagination can take it and regulatory bodies permit it, leading to splintering and further blurring between its boundaries with other categories.

The 2010 GET Conference closed with the personal genomics company Knome awarding a free exome sequence to the most original audience-supplied idea applying personal genomics. The winning proposal, submitted by Jonathan Eisen, would supplement understanding of our ancestors by sequencing current and ancestral microbiomes. A sampling of the submissions that didn’t win – including sequencing of millions of sperm from an individual to understand germ line variation, replacing newborn blood-spot testing with genomic sequencing, using real-time genetic testing to identify and prevent allergic reactions, constructing encryption keys from an individual’s genomic code and the development of new commercial models to expand access to and participation in personal genomics – provides a glimpse at the untapped applications for personal genomics.

Where will personal genomics head from here? I, for one, am already looking forward to the 2011 version of the GET Conference by which time, if recent history is any guide, this roadmap will already be out of date. And that, without question, is the most exciting thing about personal genomics as we close the book on the 2010 GET Conference.

The announcement generating the biggest buzz today came from Illumina, Inc., whose CEO Jay Flatley unveiled a new genome sequencing machine, the HiSeq 2000. According to Matthew Herper of Forbes.com, Illumina’s new machine “will decode a person’s DNA in one week using $10,000 worth of materials – five times cheaper than any other competing gadget on the market.” Herper adds that the machines will begin shipping in February with a cost of $690,000 (compared to $500,000 for Illumina’s current model). Illumina’s own product page for the HiSeq 2000 provides more technical details, including coverage (~30x) and read length (2×100 bp). There have also been unconfirmed rumors that the machine will come equipped with an iPhone user interface, a concept that Flatley first pitched at last summer’s Consumer Genetics Show.

If it performs as advertised, the HiSeq 2000 is likely to be a huge hit with large genome sequencing centers, as evidenced by the announcement that the BGI (formerly the Beijing Genomics Institute) has agreed to purchase a whopping 128 of the new sequencing systems. But what, if anything, does the Illumina announcement mean for individuals consumers interested in receiving a complete genomic sequence?

Although Herper declares that Illumina’s machine is “five times cheaper than any other competing gadget on the market,” I’m not entirely sure that is true. According to Illumina, the $10,000 price tag is for “reagent costs at list price” and does not include other significant costs, including purchasing the machine itself or analyzing the raw genomic data. In fact, it’s not even clear to me that the announcement represents a five-fold drop from the commercial whole-genome sequencing Illumina announced last June. That service offered consumers the opportunity to purchase a whole-genome sequence at the same 30x coverage for $48,000 and, although interpretation was similarly not included, consumers weren’t required to purchase their own sequencing machine and did receive a free iMac as part of the bargain.

Also in the middle of the whole-genome sequencing competition is sequencing-as-a-service provider Complete Genomics, which is presenting at the J.P. Morgan conference tomorrow morning and may well have at least a partial answer for Illumina’s announcement. Even if there’s no big news forthcoming from Complete, the company’s November announcement that it had sequenced three whole-genomes for an average materials cost of $4,400 and reports that it is selling whole-genome sequences at $20,000 apiece in minimum orders of five, with the price dropping as the order size increases positions Complete as a clear competitor to Illumina, at least from a pure price standpoint.

All told, Illumina’s announcement strikes me less as a sequencing milestone and more as a tightening of an already extremely fierce race toward the $1,000 genome. Nonetheless, if there are consumers out there who are awaiting a whole-genome sequence and look at $10,000 (and not $1,000) as the magic number, Illumina’s announcement could bode well. It seems likely that Illumina will drop the price of its own commercial whole-genome sequencing service from its current $48,000 and direct-to-consumer (DTC) whole-genome sequencer Knome, which uses the BGI to perform its sequencing, is also a likely candidate to announce a price reduction in the coming weeks (the current cost is believed to be $68,000).

Finally, the substantial buzz surrounding Illumina’s announcement and the continued tightening of the race to the $1,000 genome encourages me to reiterate what I wrote just last week in Five Questions for Personal Genomics in 2010:

The success of personal genomics, which is what really matters to consumers, patients and healthcare providers, requires more than inexpensive genomic data. The real breakthrough in personal genomics will come when we can offer individuals affordable access to their whole-genome sequence as well as to the genomic tools and knowledgebase necessary for those individuals to put that data to use.

Update 1/12: Ed Winnick of GenomeWeb has additional details on Illumina’s launch of the HiSeq 2000 and its partnership with BGI, including Jay Flatley’s statement that BGI’s order will ultimately allow it to sequence 11,000 human genomes per year.

Update 1/13: Daniel MacArthur of Genetic Future, Luke Jostins of Genetic Interference and David Dooling of PolITiGenomics all offer their analysis of what Illumina’s announcement means for the present and future of genomic sequencing. Also, in breaking news, Linda Avey is covering Complete Genomics’ presentation this afternoon and reports that the company has delivered 50 genomes to date and expects to deliver another 5,000 in 2010.

Update 1/14: GenomeWeb Daily News has more coverage of Complete Genomics’ announcements, including that the company plans to sequence up to one million human genomes worldwide over the next five years and is interested in exploring the IPO market. Also worth noting is the fact that the Complete Genomics sequencing-as-a-service model includes analysis and reporting, not just raw data, which makes comparing the current price tags for Complete ($20K) and Illumina ($10K for reagents only, no analysis) a bit like comparing apples to oranges.

1. Is DTC Getting HIPAA? The Health Insurance Portability and Accountability Act of 1996 (HIPAA), the most prominent federal regulation governing the privacy of medical records, established the Privacy Rule to provide national standards for protected medical records. HIPAA’s Privacy Rule currently applies only to “covered entities” and business associates of covered entities. A covered entity is a health plan, health care clearinghouse, or a health care provider. Since a company providing genomic sequencing services is not a health plan or a health care clearinghouse, HIPAA will apply only if such a company is determined to be a health care provider or a business associate of a covered entity.

Direct-to-consumer (DTC) genomics companies are not likely to be considered business associates of HIPAA covered entities. HIPAA defines a business associate as a person or organization that, on behalf of a covered entity, performs an activity involving the use or disclosure of individually identifiable health information, or otherwise performs services for a covered entity where the covered entity provides such health information to the business associate. The American Recovery and Reinvestment Act (ARRA) expanded the definition of business associate for purposes of the Privacy Rule and the Security Rule to include

• entities providing data transmission of protected health information to covered entities (or such entity’s business associate) and requiring access on a routine basis to such information, and
• vendors contracting with a covered entity to allow the covered entity to offer personal health records to its patients.

DTC genomics companies typically do not act on behalf of a covered entity, nor do they provide services to covered entities. Rather, as the DTC name suggests, companies such as 23andMe provide services directly to the consumer. However, this is not always the case. For example, California-based Navigenics, commonly referred to as a DTC genomics company, has announced a number of partnerships with healthcare clinics through which it offers its genotyping services to the clinic for use in developing personalized diagnostic, management and treatment strategies for patients. Just last week, Navigenics announced a partnership with Beth Israel Deaconness Medical Center in Boston to familiarize practicing physicians with its DTC offerings, among other goals. Looking at Navigenics’ list of collaborators reveals a number of relationships where Navigenics appears to be performing services (genotyping and risk prediction) and providing identifiable health information (the genotyping results) to health care providers. Whether or not a particular DTC genomics company qualifies as a business associate depends on the particulars of the services it offers, particularly those that it makes available directly to health care providers; particulars which are subject to change at a moment’s notice in this rapidly evolving field.

Moreover, it is conceivable that a DTC genomics company could be considered a health care provider itself. Although we are not aware of any regulative body that has found a DTC genomics company to be covered by HIPAA (as a health care provider or otherwise), the term “health care” is defined broadly under HIPAA regulations:

Health care means care, services, or supplies related to the health of an individual. Health care includes, but is not limited to, the following:

(1) Preventive, diagnostic, therapeutic, rehabilitative, maintenance, or palliative care, and counseling, service, assessment, or procedure with respect to the physical or mental condition, or functional status, of an individual or that affects the structure or function of the body….

If a DTC genomics company provides diagnostic or analytical information to a customer in connection with the customer’s genomic sequence, it may be considered to be offering “diagnostic care” or “counseling with respect to the physical or mental condition of an individual”—and thus, to be a health care provider subject to the HIPAA regulations. Existing DTC providers do offer substantial information that could fall into those categories, including relative risk and lifetime risk calculations for serious diseases (23andMe’s testing service, for instance, includes “carrier reports” for 32 conditions including several cancers, Parkinson’s Disease and diabetes) and the determination of carrier status for alleles with reproductive implications. In addition, other companies such as Navigenics, provide access to board-certified genetic counselors to assist customers in interpreting their results.

The provision of clinical diagnostic information and genetic counseling, even when delivered over a website rather than in a doctor’s office, may constitute the provision of health care. In recent weeks the Genomics Law Report has focused on the recurring calls for standards that would have the effect of blurring the distinction between direct-to-consumer genetic testing and the clinical practice of medicine (also see here, here, here and here). One potential effect of confusing the clinical/non-clinical divide in the DTC setting would likely be to bring DTC service providers unambiguously under the purview of HIPAA as a health care provider. As described below, however, despite the increasingly clinical nature of the services offered by DTC providers, there does not appear to be much enthusiasm for subjecting genomics companies to HIPAA or to other clinical regulations.

2. Why Does HIPAA Matter? Even if a DTC genomics company is deemed to provide a level of service sufficient to make it a covered entity under HIPAA, it may still disclose confidential protected health information (such as a customer’s genetic or genomic results) for the purpose of carrying out “health care operations.” Health care operations are broadly defined in HIPAA Section 164.501 to include business management and general administrative activities. Specifically disclosure is permitted relating to the “sale, transfer, merger or consolidation of all or a part of the covered entity with another covered entity, or an entity that following such activity will become a covered entity and due diligence related to such activity.” Among the amendments to HIPAA contained in the ARRA is a specific prohibition on the sale of protected health information, except for the sale of information in connection with the sale, transfer or consolidation of the covered entity. Therefore, even when HIPAA applies, patient or customer authorization is not required for disclosure of protected health information in the sale of the company’s assets.

HIPAA does not specifically address the bankruptcy of a covered entity; however, it seems that the sale or transfer exception would likely apply. A liquidation in bankruptcy requires the sale of the debtor’s assets. As long as the protected information is transferred to another covered entity in connection with a sale of the assets, presumably individual authorization from the DTC genomics company’s customers would not be required.

For the moment, it does not appear that HIPAA regulations are restricting much if any of the activity currently taking place in the DTC genomics space. However, as a host of factors, including both internal and external pressures, continue to drive many DTC genomics companies closer and closer to activities indistinguishable from the clinical practice of medicine, at least some DTC companies may soon find themselves subject to HIPAA’s regulations. The implications of HIPAA coverage for DTC genomics companies is the subject for another post, but in the limited case of a bankruptcy scenario, even HIPAA coverage would not appear to prohibit a DTC genomics company from transferring its customers’ genomic information.

3. DTC Escapes Stimulus Bill Unscathed? Part of the Stimulus Bill enacted this past spring directed the Department of Health and Human Services (HHS), in conjunction with the Federal Trade Commission (FTC), to conduct a study on privacy, security, and breach-notification requirements for vendors of personal health records (PHRs) and related entities that are not subject to HIPAA. In the meantime, the Act required the FTC to issue a rule requiring these entities to notify consumers if the security of their health information is breached.

The FTC issued a proposed notification rule (pdf) in April 2009, applying to PHR vendors, PHR-related entities, and third party service providers. All three categories, however, are restricted to firms that handle personal health information.

Upon publication of the proposed rule, the FTC solicited comments from the public. One of the comments was from a nonprofit health privacy watchdog group, Patient Privacy Rights, on behalf of the Coalition for Patient Privacy (a group that includes the American Civil Liberties Union and the American Association for People with Disabilities). The Patient Privacy Rights comment (pdf) objected to the limitation of the proposed rule to “the organization and sharing of personal health records,” because the definition of personal health records did not explicitly include genetic or genomic information. As the group explained:

Personal genomics companies such as 23andMe, Navigenics, Knome, and deCODE offer individual genetic testing that can provide customers with novel health services—from determining the likelihood of contracting diabetes, to identifying ancestral roots. Such companies rely on (HIPAA-compliant) labs to analyze patient DNA, which they receive directly, analyze, and store online for access by the patient.

A patient whose genetic information is leaked, stolen, or disclosed could clearly suffer harm as great as that associated with any other PHR health data, as recognized by the various state and federal laws around genetic privacy. The Commission should accordingly determine that personal genomics companies constitute [Personal Health Record] related entities insofar as they ‘access[] information in a personal health record’ or ‘offer[] or maintain[] a personal health record.’

However, when the final notification rule (pdf) was published in August of this year, the FTC had declined to modify the rule as requested by Patient Privacy Rights. The Commission’s final rule contains no mention of genetic data or genomics companies.

While we will have to wait for the completion of the joint HHS/FTC study in February 2010 to see whether it explicitly covers genomics companies in any of its privacy or security regulations, the FTC’s security breach rule suggests that it is unlikely that any such regulations will be immediately forthcoming.

Accordingly, the genomic information supplied by DTC companies is likely to be covered by the FTC’s regulations only to the extent such information constitutes personal health information (thus making a genomics company a firm that handles PHI and subject to the regulations.) This is where GINA comes in.

4. GINA and the Privacy Rule: Did Anything Really Change? The Genetic Information Nondiscrimination Act of 2008 (GINA) requires that the HHS Secretary revise the HIPAA Privacy Rule to make clear that “[g]enetic information shall be treated as health information.” Although GINA required that HHS issue implementing regulations not later than May 2009, it wasn’t until this month that HHS’ Office of Civil Rights issued its proposed rules (pdf). The background discussion of the proposed rule points out, however, that although the term “health information” would be amended “to explicitly provide that such term includes genetic information,” that does not mean that all disclosures of genetic information would necessarily be protected under HIPAA’s Privacy Rule:

We note, however, that as before, genetic information, while health information, is only covered by the Privacy Rule to the extent that it meets the definition of “protected health information.” That is, the genetic information must be individually identifiable and maintained by a HIPAA covered entity (or business associate of a covered entity) (and not otherwise fall within one of the exceptions to the definition).

Thus, although GINA amended the Privacy Rule to cover genetic information, the type of entities covered by the Privacy Rule did not change: it still only applies to HIPAA’s “covered entities.” And so we have come full circle: the key question remains whether DTC Genomics companies are considered to be covered entities, either as health care providers or as business associates of health care providers. While that question remains unsettled, the tone of the note suggests that HHS is not actively seeking ways to apply its regulations to genomics companies.

5. What Does It All Mean? As discussed above, the trend toward clinical activity on the part of many DTC genomics companies could ultimately bring them within the ambit of HIPAA and its Privacy Rule. However, at present it does not appear that there is any federal regulation—including HIPAA—that clearly restricts the transfer of customers’ information as part of a sale of assets by a troubled DTC genomics company.

As we concluded last time, the true test for the handling of individuals’ genetic and genomic information collected by DTC companies will be the first actual bankruptcy. Until then it will remain extremely difficult to predict how regulators and bankruptcy courts will address such a scenario, and the most practical advice at this time, for existing and potential customers, continues to be to understand the terms and conditions offered by each individual DTC genomics company with respect to their customers’ information—and to recognize that, in bankruptcy, genomic data may be transferred to a similar company without regard to those terms and conditions..

As for the DTC companies themselves, the possibility that they may be subjected to regulation under HIPAA and the Privacy Rule—as well as, potentially, a host of other regulations and sources of liability associated with the provision of health care—has implications far beyond the bankruptcy scenario. In the coming weeks the Genomics Law Report will begin to investigate what it might mean for DTC genomics companies if the blurry line between clinical and non-clinical activity in the DTC space finally resolves itself, with the DTC companies on the clinical side of that line.

The workshop focused on a review of the “scientific foundation for using personal genomics in risk assessment and disease prevention,” developing five specific recommendations for the future development and use of personal genomics.

1. Develop and implement scientific standards for personal genomics. Of primary importance was the development of scientific benchmarks for evaluating personal genomics testing. Heavily emphasized was the need to establish standards for measuring the clinical validity (how well a genetic variant identifies or predicts an individual’s clinical status) and clinical utility (the health and other benefits of a test balanced against its harms or costs) of personal genomics tests. The importance of voluntary industry guidelines (pdf), randomized clinical trials and economic analysis of personal genomics testing were all discussed.

2. Develop and implement a multidisciplinary research agenda. The workshop recognized that this area is a meeting point for many disciplines, including, in addition to the obvious biological and medical fields, the fields of communication and behavioral and social sciences. There is a need for large-scale research projects to improve risk characterization, “especially of gene-gene and gene-environment interactions.” But there is also a need to study how the results of such research are publicly disseminated and become incorporated into the delivery of health services or the decision-making of individual consumers.

3. Enhance credible knowledge synthesis and dissemination of information to providers and consumers. Continuing with the theme of communicating knowledge to policy makers, health care providers and individuals, workshop participants noted that such communication needs to be timely and capable of “rapid turnaround” (given the pace of developments), based on standardized formats, and subject to agreed standards for what constitutes the “best available data.”

4. Link scientific research on validity and utility to evidence-based recommendations for use of personal genomic tests. One of the key issues for personal genomics, and particularly for direct-to-consumer (DTC) genomics companies, is when and how policymakers, clinicians and healthcare payors (including consumers) will determine that a personalized genomic test has demonstrated sufficient clinical validity and clinical utility to warrant its incorporation “into clinical practice and disease prevention.” Setting the bar for this “evidence threshold” at an appropriate height was another concern of the panel, and it noted that setting the bar too law resulted in the marketing and use of genomic tests without sufficient evidence of their clinical validity and/or utility, a common concern voiced by critics of the DTC genomics industry. Setting the bar too high, on the other hand, “may result in tests with high validity and utility but with lower financial incentive for innovation” which could, paradoxically, “lead to fewer developed tests and potentially diminished health benefits.…” The panel declined to offer its own suggestion for an appropriate evidence threshold, concluding only that the bar must be set by “independent panels that have no conflict of interest and use rigorous systematic evaluations,” such as those employed by EGAPP and USPSTF.

5. Consider the value of personal utility. Finally, the panel went out of its way to highlight the potential “personal utility” of genomic and genetic testing and services. Even in the absence of proven clinical or medical interventions, personal genomics information may have utility for individuals, including promoting improved comprehension of genetic information and the adoption of healthy lifestyle changes. As an example, the participants singled out the recent REVEAL Study conducted by Bob Green et al. that found, in the case of Alzheimer Disease (AD), that “even though there are no proven effective interventions to remediate” the risk of AD, providing participants with genetic information regarding that risk was found “to be useful by allowing them to prepare their families and arrange personal affairs including long-term care.”

DTC genomics companies have long trumpeted the personal utility of their products, often choosing to highlight the educational aspects of their services in the face of doubts about their clinical validity and/or utility. The workshop’s recommendation that these “perceptions of utility” be “scientifically supported” with “objective metrics” and “rigorous multidisciplinary observational studies and [randomized clinical trials],” if carried out, would be an acid test for the personal genomics industry and its claims of personal utility. Some of this work has already begun and, from an industry perspective, the preliminary results are encouraging. A recent study (the NIH Multiplex Initiative) of early adopters of genetic testing services similar to those provided by DTC companies found that such individuals “may be among the most motivated to take steps toward healthier lifestyles.”

Of course, no set of personal genomics recommendations would be complete without the obligatory ELSI nod: “these scientific standards have to be examined in the context of principles of population screening with full consideration of the ethical, legal and social, economic, and policy issues.” Ultimately, however, its encouraging to see such influential individuals in the field of personal genomics continuing to focus their attention on better understanding the science, utilization and effect of personal genomics. This initiative provides a useful counterbalance to calls for the preemptive regulation of a field that remains in its infancy.

Although focused on the BRCA genes, the question is broadly applicable to the entire genome sequencing industry: when sequencing all or a portion (e.g., the exome) of an individual’s genome, are individual gene patents infringed upon by either the company providing the sequence or the individual purchasing or requesting it? The answer is not entirely clear, but, at least in the case of Myriad and the BRCA genes, it appears to be no. Or at least, not yet.

Let’s begin with what is not patented, which includes a majority of genes and the vast majority of the human genome. Genes—those stretches of DNA that encode for proteins—make up approximately 2% of the human genome. The estimate of the exact number of genes ranges from between roughly 20,000 to 30,000 and, of those, a 2005 study in the journal Science found that only 20% of human gene DNA sequences are patented (subscription). Although those numbers are certainly subject to change, the reality is that, today, it is likely that less than 1% of the entire human genome has been patented.

Of course, that very small number belies the fact that the genes which have been patented consist of some of the most important identified genes associated with the prediction or determination of human health and disease. The high-profile BRCA genes are an excellent example and thus make for a good case study.

To understand how whole-genome sequencing interacts with a particular gene patent we should start with the actual claims of the patent itself, which define exactly what is covered. In the case of Myriad’s BRCA patents, the broadest claim is illustrated by Claim 1 of U.S. Patent No. 5,747,282, issued to Skolnick et al. in 1998 and assigned to Myriad:

1. An isolated DNA coding for a BRCA1 polypeptide, said polypeptide having the amino acid sequence set forth in SEQ ID NO:2.

Note that the patented breast cancer susceptibility gene is defined by its function: the claim covers any DNA molecule that codes for the protein that has the amino acid sequence listed in the cited attachment. A second claim (called a dependent claim) further defines the patented gene by reference to its DNA sequence:

2. The isolated DNA of claim 1, wherein said DNA has the nucleotide sequence set forth in SEQ ID NO:1.

In either case, the patent law is clear: anyone who makes, uses, sells, or offers to sell that gene needs permission from Myriad. The single significant limitation in this case is that Myriad’s patent covers only isolated versions of the BRCA-1 gene. What does isolated mean?

Here we turn to the ancient—if somewhat awkward—patent maxim that “the patentee is his own lexicographer.” Although terms in a patent claim typically receive their ordinary meaning, courts, along with the USPTO, allow patentees, subject to some limitations, to define the terms used in the patent as they choose, even in a manner inconsistent with a term’s ordinary meaning. Here’s what Skolnick et al. said in their BRCA patent:

“Isolated” or “substantially pure”. An “isolated” or “substantially pure” nucleic acid (e.g., an RNA, DNA or a mixed polymer) is one which is substantially separated from other cellular components which naturally accompany a native human sequence or protein, e.g., ribosomes, polymerases, many other human genome sequences and proteins. The term embraces a nucleic acid sequence or protein which has been removed from its naturally occurring environment, and includes recombinant or cloned DNA isolates and chemically synthesized analogs or analogs biologically synthesized by heterologous systems.

The critical point is that, to be covered by the patent, the gene must be “substantially separated from other cellular components which naturally accompany a native human sequence”—including “many other human genome sequences.” Removing the BCRA-1 gene from its natural environment (the genome) to test it or to synthesize it would be a clear case of infringement. But whole-genome sequencing is different. Companies that offer whole-genome sequencing services (e.g., Knome and Illumina) could argue—plausibly—that they do not separate Myriad’s gene (or any other gene) from its natural neighborhood of other genes because of the method in which they sequence the genome.

Whether or not this technical distinction would succeed if challenged by Myriad in court is unclear but it may help explain why Myriad, which has been aggressive in asserting its patent rights to exert exclusive control over testing for the BRCA-1 and -2 genes, particularly in clinical settings, has not publicly asserted its patent rights against any commercial providers of whole-genome sequencing.

Unfortunately for the whole-genome sequencing industry, this type of analysis—an examination of the specific patent claims in light of a company’s sequencing technology—may be required for all or many of the thousands of human gene sequences subject to patent protection. Earlier this spring an article in Nature concluded that, among thousands of gene patents, “some patent claims will be infringed by full-genome sequencing,” and the Secretary’s Advisory Committee on Genetics, Health, and Society (SACGHS) concluded in its draft report on the effects of gene patenting (pdf) that the number of gene patents “could have significant implications for the development of whole-genome sequencing,” including forcing “a developer that wished to offer whole-genome sequencing…to obtain licenses for all unexpired patents…from the human genome.”

As with so many other aspects of the nascent whole-genome sequencing industry, the ultimate impact of gene patents remains to be seen. At present the cost of a whole-genome sequence remains high (Illumina is the current standard-bearer at $48,000, although Knome offers exome sequencing—which likely includes sequencing of most patented genes—for as little as $19,500), and the number of individuals who have had their entire genomes sequenced (whether by commercial or research outfits), although not known with precision, is almost certainly less than 100 worldwide.

With such a low level of current whole-genome sequencing activity there is a good practical reason for companies like Myriad to avoid pressing the infringement issue: their legal costs, not to mention the likely adverse publicity, would dwarf any licensing revenue. But as the era of the $1,000 genome approaches, the number of whole-genome sequences is predicted to rise rapidly and the economics are set to radically shift. Today, Myriad charges roughly $3,000 for its BRCA test. If and when whole-genome sequencing becomes available for a price in the neighborhood of $1,000, it becomes nearly impossible to imagine anyone—insurers or consumers alike—handing over $3,000 for the sequence results of a single gene when they could receive their entire genome for a fraction of that cost.

At least for the moment, whole-genome sequencing and gene patents coexist, despite considerable uncertainty. But while it’s impossible to accurately predict even a few months into the future in such a turbulent field, there is a basic economic truth that cannot be ignored: high-cost licenses for the rights to specific gene patents are fundamentally incompatible with low-cost whole-genome sequencing.

When and where will the next chapter be written? While the ACLU challenges the validity of gene patents (including Myriad’s BRCA patents), and the whole-genome sequencing industry continues to drive costs down, the next scheduled development is the release of the final SACGS report on gene patenting, which is due out in October and will be eagerly awaited by patent holders and licensors, DTC testing and sequencing companies, and policymakers alike.

Following Illumina’s announcement at the Consumer Genetics Show, Daniel MacArthur at Genetic Future speculated that Illumina, in focusing “on the sequence generation side…[was] restricting itself to the least attractive segment of the personal genomics market.” And I agreed, arguing that the bioinformatics portion of the genome sequencing market — interpreting and functionalizing raw sequence data — appeared to be both larger and less well-developed, thus presenting a more promising commercial opportunity.

If there’s anybody who should know where the future commercial value of whole-genome sequencing resides it is Jorge Conde, CEO of Knome, the only commercial genomics company (at this time) that will both sequence and interpret an entire genome. In a recent article by Emily Singer in MIT’s Technology Review, Conde weighed in on the future of whole-genome sequencing:

Analysis of the meaning of the human genome is proving to be more much more complicated than the sequencing itself. “In the long-term, that will be a big driver of value,” says Conde. “We will see the high price point go away, and the real value for both individuals and companies will be to provide an ongoing narrative.”

Although some companies (Complete Genomics) and research (the Human Microbiome Project) have focused on sequencing projects that look beyond the human genome, I continue to believe that the bioinformatics and interpretive components of whole-genome sequencing services are likely to be the key drivers of value for both consumers and companies as the industry develops. After all, no matter where and how often sequencing occurs, it’s only as useful as the interpretation afforded it.

But even as the interpretation of genomes inevitably improves, the question remains whether that interpretation will be performed on genomic data that reaches the clinic in silico or in vivo. The standard story of personal genomics is that a few years hence, once the cost has dropped to $1,000 (or lower), genomic sequencing will become a once-in-a-lifetime event, with the genome in silico taking its rightful place in the typical patient’s (electronic) health record. Yet after my conversations at Breckenridge this weekend — along with last week’s announcement by scientists at McGill University that suggests the genetic sequence may vary between an individual’s blood and tissue cells — I’m wondering if it’s time to reexamine the inevitability of the genome in silico and to consider the possibility that, even in an age of personal genomics and personalized medicine, patients may continue to carry their genomic sequences into the doctor’s office the old-fashioned way: under their skin.