Return of the Crystal Ball

Wednesday, November 07, 2012
Obama Crystal Ball

The votes are in and whatever your political persuasion, this much is clear: Barack Obama will be president of the US for another four years. So we thought it might be time to dust off the crystal ball we peered into after his first election in 2008.

In retrospect, the most surprising thing about our 2008 prediction was its modesty: we foresaw increased enforcement. How bold. We said nothing about IVDMIA or LDTs, not a whisper about DTC genomics or companion diagnostics. Let's see if we can be a bit more adventerous this time around.

Bayesian Statistics

Despite all the months of hand-wringing and moaning in the popular press about how the race was a nail-biter that would be too close to call, it turned out not to be that close after all. This outcome was completely unsurprising for regular readers of Nate Silver, whose fivethirtyeight blog has shown this race as being not very close for months now.

Obama won the election, but Silver may have achived an equally significant victory: proof of concept. Silver, you see, is a strong proponent of Bayesian statistics. Though many of us may think of Bayesian stats as an imprecise tool for catching spam or inferring book preferences, Silver has been laying a careful and patient case for their real-world application. FDA technically allows Bayesian methods, but hews closely enough to the "frequentist" worldview that Bayesian methods don't seem to get enough latitude to make a difference in most cases.

That's not going to change tomorrow or next week, but expect to hear a lot more about the resurgence of Bayesian stats in the foreseeable future. If we see changes in grad school curricula take hold, FDA may be forced to embrace this methodology sooner or later.


First, the obvious prediction: we see absolutely no reason to believe that any part of the regulatory environment will change for LDTs. LDT regulation (like herbal supplement regulation) makes no possible sense and is wretched policy... but we're probably stuck with it now. Unless an LDT somehow kills one of the cast members of Real Housewives, we're not likely to see much movement on this one.

Despite the fears of the talk radio crowd, Obama is not going to pull off his rubber mask and reveal the wild-eyed regulatory fanatic he's been keeping hidden for four years. He's told us exactly what he thinks on this issue and there's no reason to think he's going to spend any of his precious political capital deciding to care about (or even understand) an issue his administration has pushed back on already. 

By the same token, a whole lot of people have come to care very deeply about this issue: forward-thinking LDT players. Many of them have decided to hang up the cowboy hat and spurs and become homesteaders instead. And the landscape looks very different once you've decided you're not just passing through on your way to the gold rush.

So... we predict that the tension between what FDA believes it should do and what it actually can do will remain interesting. We may still see the emergence of some strategy that creates through enforcement what FDA is unable to assert through policy. But on this front, Obama's re-election does not provide much hope for change.

The real news will be what happens at industry trade groups and among payers. Will the success of clinical labs crossing over to the regulated market create a rift or re-assessment of strategy at AdvaMed? Will a payer finally put down their foot and say that clearance/approval counts for something? Will the full implementation of Obamacare end up putting this all in some other agency's lap? Our crystal ball is a bit fuzzy on the details, but this will be a fluid situation for some time to come.

Irrational Enforcement

We've debated whether to blog about the (latest) scandal in pharmacy compounding. That's not strictly our area of expertise, yet the comparison between the regulation of compounding and LDTs is almost too obvious to point out. It's still unclear whether we will blog at any length on this topic, but one thing is now crystal clear: as a nation, we're really not showing any signs of being serious about understanding FDA's role. It makes sense that Congress is holding hearings, but then they're asking FDA how this could have allowed this to happen?

Wow. Just wow.

So once again, FDA is being given a super-clear mandate: don't ever do anything that disrupts anything ever, but totally don't let anything bad happen either. Oh, and also don't develop any tools or data sets that would help you measure or explain the difference between good stuff and bad stuff. We're going to go way out on a limb here and point out the obvious: enforcement is going to continue to seem random and arbitrary. Congress won't have it any other way.

FDA's going to put a brave face on all this and continue to do their best. But we should also appreciate a simple truth that they will be unable to point out: FDA reports to Congress and this places an upper limit on their ability to make sense. If you think your boss is terrible, just imagine what it's like to have your performance review conducted during the occasional spasms of self-promotion and butt-covering we call Congressional hearings.

CoDx / Split Authority

Companion diagnostics work best when two parties share a mutual interest in a common outcome: simultaneous approval of two products. It would be naive, however, to think that CoDx will always represent an optimal meeting of the minds and it's not clear whether FDA is truly ready to handle this case. One key problem is that authority for the therapy and the diagnostic generally are split between CDER and CDRH/CBER. Everyone's on the same side, to a point, but the criteria and incentives for approvals are slightly different. Are we truly willing to hold back a promising therapy just because the diagnostic that enables it may take longer to approve?

Recent evidence on this is split but it is starting to appear that tie goes to the therapy and that efficacy trumps all. It's too early to say this is the last word on the subject, but the mold is beginning to harden.

Whatever comes in the next four years, we look forward to facing them with you. As always, it should be interesting.

Tags: Enforcement, FDA, LDTs, Obama Administration, Policy, Politics

Other Blog Authors

Dave Kern
Steve Gutman
Jo-Ann Gonzales
Deb Morris

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