Cultivating Innovation in Precision Medicine Through Regulatory Flexibility at the FDA

Posted: 14 Feb 2017  

Jordan Paradise

Loyola University Chicago School of Law

Date Written: February 13, 2017


Public support for precision medicine is gaining momentum. President Obama initially channeled $215 million into the Precision Medicine Initiative (PMI), with funds to the National Institutes of Health and the Food and Drug Administration (FDA) “to accelerate biomedical discoveries and provide clinicians with new tools, knowledge, and therapies to select which treatments will work best for which patients.” In remarks at the White House East Room, Obama touted precision medicine as “delivering the right treatments at the right time, every time to the right person.” The 21st Century Cures Act, signed into law on December 13, 2016 further supports the PMI and related cancer and brain research with a $4.8 billion pledge over the next ten years. The Act establishes the authority of the Secretary of the Department of Health and Human Services to foster rapid innovation in this realm, and also sets forth protections for human research subjects and the data generated by research.

The PMI builds on decades of genomic research and the successful sequencing of the human genome. Many terms have evolved to describe the concept of harnessing genomic information to guide the development of diagnostics and treatment for individuals or subpopulations of patients: pharmacogenomics, personalized medicine, targeted medicine, and most recently, precision medicine. As envisioned in the PMI, precision medicine will introduce fundamental changes to the historical structure, support, and contributions in drug research and development. The PMI emphasizes the need for collaborations of academic medical centers, researchers, patients and patient advocates, private foundations, and medical product innovators to achieve its lofty goals. Emerging concerns surrounding the expansion of players in research and development include the proper role of patient advocate groups, identification and management of complex conflicts of interest, proper incentive structures, access to and sharing of research samples and health information, inventorship and patent rights, payments and contractual agreements, and eventual profit share.

Precision medicine also poses significant challenges to traditional FDA regulatory paradigms. Eventual downstream medical products will involve both the initial detection of a genetic variant and the subsequent drug treatment tailored to that genetic variant. This diagnosis - treatment spectrum necessarily implicates the regulatory authority of the FDA with regard to both medical devices and new human drugs and biologics. The success of the PMI will put pressure on a regulatory system that already suffers from a lack of clarity and heavy industry criticism. Precision medicine also implicates the ongoing debate about FDA oversight of laboratory developed tests. In a 2013 report, the FDA acknowledged that precision medicine ushers in a “new era” yet was hopeful that regulatory adaptation is possible. With enactment of the 21st Century Cures Act and other recent legislation, that adaptation may be achievable.

This article will survey the current structure of the FDA regulatory regime as it impacts precision medicine and will particularly discuss the implications for a category of FDA-regulated products called companion diagnostics. Part I will explore the field of precision medicine and its connection to companion diagnostics, highlighting the historical background, incremental funding initiatives, and current regulatory considerations. Part II will identify key legislative and agency activity supporting innovation in biomedicine, including the Affordable Care Act of 2010, the FDA Safety and Innovation Act of 2012, the 21st Century Cures Act of 2016, and FDA policy on laboratory-developed tests. Part III will set forth the current FDA institutional frameworks for regulation of traditional drug, biologic, and medical device products, as well as the FDA’s approach to companion diagnostics, including inter-agency coordination models. Part IV sets forth the hurdles to effective industry coordination in the companion diagnostic field. These hurdles include diverse business models and variations in research and development costs, variable patent protections, a lack of incentives to foster collaboration, asymmetry in information gathering and sharing, and uncertainty in regulatory fate. Part V suggests a variety of transformative regulatory options to bolster product development for precision medicine products, building on flexibility provided in recent legislation, as well as reworking existing information networks and incentive systems.

Keywords: Precision medicine, companion diagnostics, drugs, medical devices, FDA, regulation, 21st Century Cures Act, innovation

Suggested Citation

Paradise, Jordan, Cultivating Innovation in Precision Medicine Through Regulatory Flexibility at the FDA (February 13, 2017). Available at SSRN:

Jordan K. Paradise (Contact Author)

Loyola University Chicago School of Law ( email )

25 E. Pearson
Chicago, IL 60611
United States

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