Hello, everyone, and welcome to today's webinar, Mastering Quality Management systems Ensuring compliance with the new FDALDT rule. We're very excited you're joining us today. My name is Carly Knable and I'm a Marketing Manager at Promega and I will be your moderator. Today. Before we begin, I'd like to cover a few housekeeping things. On your screen, you will see multiple windows, all of which are movable and resizable, so feel free to move them around to get the most out of your desktop space. Also, there are many ways to be interactive during this webinar. Please submit a question at any time during the webinar and we will answer them at the end of the presentations during the live Q&A session. In the resource Library is a list of helpful materials, which also includes a copy of today's presentations. So feel free to download any resources or bookmark any links that you may find useful. After the presentations, there will be a short survey. Please take a moment to answer these questions as your feedback is very appreciated. And lastly, please feel free to share this webinar with any of your colleagues. OK. Let's get to know our speakers a little bit more. Our first speaker today is Mike Ryan with McDermott, Will and Emory. Mike advises manufacturers, healthcare providers, drug and technology developers, and investors on the legal, regulatory, and reimbursement issues that arise during the development and commercialization of medical devices, clinical laboratory testing services, biological products, and drugs. He helps innovative companies identify and navigate applicable FDA regulatory requirements for new technologies, particularly in in vitro diagnostics, laboratory developed tests, and digital health products. He also guides life science companies and laboratories by evaluating and implementing strategies to optimize coding, coverage and payment for novel technologies throughout the life cycle of FDA regulated medical devices, drugs, and biological products. Mike provides clients, including global device companies and diagnostic test developers, with sound guidance on compliance issues. He is experienced in the review of promotional and marketing materials for FDA regulated medical products. Mike also counsels clinical laboratories on state and federal compliance issues, including under the Clio State laboratory licensure laws and billing and reimbursement rules. Our second speaker today is Abigail Davis with Promega Abigail is a seasoned quality and regulatory professional with over 25 years of experience spanning life science products, medical devices, and drugs. As the Director of Quality Assurance at Promega, she leads strategic QA initiatives and ensures compliance with key regulations and standards in academia. Abigail serves as an adjunct professor at both Northwestern University and the University of Wisconsin Madison. At Northwestern, she teaches in the Quality Assurance and Regulatory Science Master's program, focusing on applied quality and regulatory practices. At the University of Wisconsin Madison, she instructs on GXP Good laboratory clinical manufacturing practice standards in the applied drug development and Master's program. Abigail holds a Masters of Science and Biotechnology from the University of Wisconsin, Madison and a graduate certificate and regulatory and quality compliance from Purdue University. Her extensive industry and academic experience provider with a grounded and comprehensive perspective on quality and regulatory compliance. Thanks to both Mike and Abigail being here today. And with that, I will hand the slides over to Mike. Thanks so much. Carly for the introductions and welcome everyone. We're so pleased to have you for today's webinar. Just to give you a brief overview of where we're headed today for Abigail, and I'll be discussing 3 items. The 1st is the role of a quality management system in compliance with FDA's new rule on the regulation of laboratory developed tests. That discussion is going to include an overview of how FDA intends to regulate LDTS as medical devices and specifically how FDA is going to approach the oversight of modifications made to laboratory developed tests as part of a quality management system. From there, we're going to talk a bit more and do a deeper dive into how laboratories should be building out an effective quality management system. So just to sort of level set about where we are, question we often get from clients over the years has been sort of what is a laboratory developed test or an LDT? And FDA has its own, if it's a relatively narrow definition compared to where industry as a whole has been. FDA in the final rule, consistent with the approach it's taken over the last, you know, decade or two, it's been that a laboratory developed test is an in vitro diagnostic that's a intended for clinical use and it's B designed, manufactured and used within a single CLIA certified high complexity clinical laboratory. Recognize that at various points throughout the life cycle of an LDT, there's been some question about whether those can be offered in more than a single location. For purposes of FDA's rule, they do say that it is a test that's offered in a single location, but allow for the fact that number of laboratories have offered tests that don't meet within that narrow definition and are therefore considered under FD as framework to be offered as LD TS. And in most cases under the final rule, FDA is going to treat those tests that are offered as LD TS the same as the test that meets that sort of narrow definition you see at the top of the slide. The reason why what is or isn't that LDT is significant is because FDA has long taken the position, the last two to three decades that an LDT is in fact a medical device under the Food, Drug and Cosmetic Act and therefore subject potentially subject to a whole slew of FDA regulatory requirements to apply to medical devices. That being said, in most cases FDA has exercised enforcement discretion with respect to most laboratory developed tests. And what that means is that in practice, even though FDA has felt that it has the authority to regulate lab developed tests medical devices, the laboratories that actually offer and perform those LD TS haven't been required to comply with all of the usual FDA requirements for medical devices. Think things like registration and listing, pre market review, quality systems, reporting of adverse events and other post market controls. Now at various points in recent years, I think as many people will know, FDA has indicated that it wanted to intend or intends to end enforcement discretion for most types of LDTS. If you think back to the 2006, 2007 time frame, FDA was trying to regulate in vitro diagnostic multivariate index assays. In 2010 they were holding public meetings. In 2014, there was a a draft guidance that outlined proposed framework for FDA review of LD TS 2017, a white paper. So this has been something that's been on FDA's radar for quite a long time. And the most recent action that we've seen has been the final rule that was issued in April of 2024. Which we're going to be. Spending a good period of today's presentation talking about to talk a little bit more about what that final rule looks like. Specifically on April 29th of 2024, FDA issued a final rule on LDTS a little over six or a little over six months after it issued a proposed rule on the same topic. And that final rule is actually deceptively simple from a legal regulatory perspective. That it really only makes like A1 sentence change to the regulations just makes clear that an LDT is generally subject to FDA's existing regulatory requirements for devices. It does that by modifying the regulations to make explicit and IVD as a medical device, even if the manufacturer is a clinical laboratory. Recognize that clarification makes a number of, you know, a number of downstream legal consequences. The actual operative text is relatively straightforward. And what that rule does, FDA recognizes that this is quite a change, right? Labs have long offered LD TS under enforcement discretion and there's a number of LD TS out there and some questions about how FDA would handle the volume of tests that would come through. Also recognize that labs are going to need time to come into compliance with FDA's requirements, which are incremental to the requirements that you would typically have under a clear a state laboratory framework. So what they've proposed or not proposed, but if actually implemented in the final rule is a plan to phase out enforcement discretion in five stages over a four year period from the date the federal from date. FDA published that final rule in the Federal Register, which was May 6th, but a week after they published it online and those time frames are outlined on this slide here. So the first group of requirements, what we'll call phase one, are those requirements that'll be effective one year after publication of the final rule. Those will go into effect on May 6th of 2025 for this first group of requirements. Is. Primarily intended to help FDA better understand what sorts of issues their labs are seeing, providers have used lab tests, are seeing with the quality of the test results are provided to them. So what they're proposing to do is end enforcement discretion with respect to a few items that would give FDA better insight into some of the issues associated with the quality of test reports. So think of things like medical device reporting, which is FDA's framework for adverse event reporting requirements. Also, there's specific requirements related to correcting issues with medical devices as well as removing those devices from the market, as well as the maintenance of complaint files. Under that phase, quality systems requirements, there's a specific regulation imposed there. So those are all things that a laboratory that's offering a test as an LDT would need to come into compliance with by May 6th of next year. Following that effective two years after publication in phase two. So those these requirements be effective on May 6th of 2026, we'd be ending enforcement discretion with respect to all other medical device requirements that aren't listed in phase one or phases 3 through 5. It is include things like registering the facility at which laboratories offering the test, listing all of the tests that are offered at the laboratory that are offered as LD TS, complying with labeling requirements, including complying with the FDA's plans to have laboratories actually submit labeling into the FDA for potential review and consideration as well as requirements related to investigational use such as the investigational device exemption requirement. Then after that three years after publication, so in phase three or effective May 6th of 2027, enforcement discretion with would end with respect to those quality systems requirements that FDA would say are applicable to high complexity clinical labs running LD TS. So some of them, such as the maintenance of complaint files, are already addressed in phase. One, but there are a. Handful of additional requirements that FDA would expect to have labs come into compliance with. These include things like design controls, purchasing controls, acceptance activities, Kappa and other records retention required records generation, and records retention requirements as compared to what labs have to go through under a CLIA. Clinical. Or a CLIA quality system. There is a substantial amount of incremental work even with this sort of pared down quality systems framework that FDA has outlined for labs to come into compliance with. But these are things that they would have to be able to or must show that they're. Able to meet beginning three years from May 6th of this year, so May 6th, 2027. And then in phase four we start to get into the pre market review requirements though effective 3 1/2 years post publication, so November 6th of 2027. The FDA would end enforcement discretion for pre market review requirements for those tests that are considered highest risk. So those tests are specifically subject to the pre market approval or PMA requirement. FDA. So for folks who may be aware, Pmas can be submitted to the FDA in a modular format. So not it doesn't have to be submitted all at once, but FDA has made it clear that at that 3 1/2 year mark, PMA. Would need to be submitted all modules in order to be eligible for continued enforcement. Description and what I mean by that is FDA said that once APMA or another type. Of submission is into the agency, FDA is going to continue to allow that test to remain on the market while those tests are under review. So if it takes FDA six months, a year, two years, however many years to get to review of an application? Depending on how many. Applications they get in those tests can remain on the market afterwards. And then phase five of the requirements are the last tranche of requirements to go into into effect. Those go into effect four years post publication and are effective on mid so May 6th of 2028. And this would end enforcement discretion for the pre market review requirements for those moderate and low risk tests. So think in this case tests that are subject to either the de Novo authorization or the five 10K requirement and as we saw in phase four with the tests that are subject to PMA requirements, FDA is going to continue exercising enforcement discretion for those tests as well while it's review of those tests is pending. Orange box here at the bottom is a critically important point. This is the general framework that applies to all LD TS, right? Regardless of the sort of how they've historically been handled. Your where something might fall in the future unless an exception applies. And we spend a number of the next few slides outlining what those exceptions are, and in particular making it clear that there are some phases here that are applicable to some types of tests. There are some phases that aren't applicable, so it'd be important to pay really close attention to what bucket a particular test falls into to figure out which of these phases actually applies. So move on to the next slide here, and this is going to talk a bit about the concept of continued enforcement discretion. And this is really one way where the FDA's final rule really substantially differs from what we saw in the proposed rule and the proposed rule that was published in September of 2023. There was very little what we historically would have called grandfathering or continued enforcement discretion for tests. That are. Currently on the market. Or tests of New York State. Approval or test with other characteristics that people might argue and make them, you know, high quality tests that should remain on the market. Proposed rule didn't really have any of that and expected most tests to come in with a few very limited exceptions. However, in the final rule, FDA made a number of changes to this concept of continued enforcement discretion and added a number of new types of tests that would be eligible for for continued enforcement discretion from certain types of FDA regulatory requirements. And we'll begin to outline what those look like on the next few slides. So this first slide, this latest slide I should say, outlines the types of tests that are would be exempt from all medical device requirements. So think everything you saw in phases one through phase five. If you fall within one of these five bullets, you're exempt from the medical device requirements. And these types of tests are outlined here. And as you might imagine, it's a pretty sort of narrowly prescribed group of tests. The first group is probably the most interesting or the one we get the most questions about. These are what FDA is called a pre 1976 type of LDT date. 1976 is significant here because that's the date the medical device amendments were enacted by Congress. And they're really envisioning here that this is the type of manual test that's being performed by a lab as it would have been performed, you know, back in the early to mid 70s before the device amendments were enacted. And FDA spends a substantial amount of time outlining the characteristics of those tests in the final rule. They also specifically exempt from all device requirements certain HLA tests performed in a lab, tests that are intended solely for use in forensic purposes or for public health surveillance. Public health surveillance piece is an interesting one because want to be clear that there's some tests, as we saw during COVID have both a public health surveillance and individual patient monitoring sort of framework or intended use. What FDA makes clear here is they're only really interested in the public health surveillance exemption, meaning that if those test results are reported back to the patient or the patient's provider on an individualized basis, that's not something that FDA would consider to be exempt from these requirements. And then last but not least, their tests performed and manufactured by the DoD or the VA for those patients that would continue to be exempt. Moving on to the next slide, this was a big ad by the FDA in the final rule. And here what we see is that for an LDT that's approved by New York State, so think a test that's gone through and received an approval, a conditional approval or falls with an approved exemption from the full technical documentation requirement. Those tests that have. Gone through the New York State. Wodsworth clip. Of full test review process and received one of those types of approvals are exempt from the pre market review requirements only. So think phase four and phase five of that five phase phase in program for labs offering those tests approved by New York State. All other medical device requirements would apply on the schedule outlined in that previous slide. So we need to come into the medical device reporting and complaint handling requirements in phase one, handle with the registration and listing and investigational device exemption requirements were applicable in phase two and critically the quality systems requirements imposed by phase three. But they would be exempt from either the PMA 510K or de Novo requirement to the extent that might apply to the test based on its intended use. Similarly, another exemption from the FDA certified phase framework here. Are those LD? TS that are first marketed prior to the publication date of the final rules of May 6th, 2024, which FDA clarifies cannot be modified or that are modified in certain limited ways. So what that means is that FDA is going to exempt those tests from both the pre market review requirements and phases 4:00 and 5:00. And most quality systems requirements, except for the record keeping requirements and phases one and phase three, all other medical device requirements would apply. So phase one, medical device reporting and registration and listing, labeling and investigational use requirements would all apply. An important limitation on this framework. Is that FDA is going to expect? Compliance with the free market review and quality systems requirements when a labs modifications and this is either individually, so it's a single change made all at once, or if the changes made to that test in aggregate are something that would typically require a new submission to the FDA. So these are things like changing the indication for use for the test, changing the underlying operating principle for the test, changing from, you know, an immunoassay platform to APCR platform, for example, or PCR to next generation sequencing, including significantly different technologies such as if you switch over and start including artificial intelligence in the test, that's something FDA would say falls outside this narrow exemption. And also, though it's hard to imagine why someone would voluntarily do this, adversely changing the performance or safety specs for the test. FDA is in part of its method for policing this also intends to request that laboratories offering LDC submit their F submit their labeling to the FDA and FDA has the intent of actually reviewing that information to look to make sure whether the claims are justified. In particular, they intend to look to see whether claims of superior performance compared to other types of tests are adequately substantiated in the peer reviewed literature. So this is a complicated and somewhat messy slide that I hope folks can read. This is actually pulled from the FDA's guidance on modifications to 510K cleared products. This is a 77 page guidance document that you know, if the final rule remains in effect, FDA and laboratories are going to spend a substantial period of time getting used to. And what these flow charts show you that there are that they're really a number of places where this number of considerations that a lab would need to make when FDA or when they're considering whether a test has been modified in a way that would require new or a new submission or they might take it out of an existing exemption. Other types of require are other types of tests that are exempt from some semblance of FDA's regulatory requirements are those tests that are performed it within an integrated healthcare system to meet an unmet need for those patients receiving care within the same healthcare system or what we cloak what they call us or the academic Medical Center exception. Again, these are tests that would be exempt from the pre market review and quality systems requirements except for record keeping and would generally be subject to phases one and phase two. Interesting piece on this exemption is that it's only available insofar as there's an LDT or as an LDT is for an unmet need for which there's no available FDA authorized test and the enforcement discretion for those tests would end once FDA authorizes the test that meets the patient's needs. FDA recognizes this is an area where they're likely to get substantial questions and they're going to need to provide additional guidance to providers. So this is something that we're going to see guidance on in the future, but FDA has not provided this information to date and it's likely to be or potentially be delayed by the ongoing litigation surrounding the surrounding the final rule. So a few additional sort of key points here. Regardless of what sort of this continued enforcement discretion framework that FDA has outlined for New York State approved tests or for those tests operated with an integrated healthcare system or for those tests that are, you know, available prior to May 6th. FDA makes it clear as it has historically that it retains the the discretion to pursue enforcement action for violations of the Food, Drug and Cosmetic Act any time as it views appropriate. One of the things that the proposed rule makes really clear is that they're likely to use the labeling information that laboratories submit to the agency. As well as. Complaints from competitors to inform where they're going to target their future activity. FDA also explains here that while all of this information is outlined in a rule which is published in the Federal Register, goes through a notice and comment rulemaking project process subject to the Administrative Procedure Act. FDA explains it may decide to update many of these enforcement discretion policies as needed based on their experience with tests as they see submissions start to come in and if they plan to do so by by a guidance. And the reason that that's significant is that it raises the possibility that FDA could make changes to this framework without going through the full notice and comment rulemaking process that, you know, it took them six months to go through here. There's a number of outstanding questions that people have about LD TS and we try to kick kick through the the main ones here. The first question. And the one. I think has the least certain answer as a lawyer is whether FDA has the legal authority to regulate LDTSI think what's clear at this point is the agency believes it has a strong argument. They spent a substantial period of time in both the proposed and final rules arguing exactly why they believe that. Food, Drug and Cosmetic Act believes it gives FDA the authority to regulate LD TS as medical devices, and FDA believes that strongly. They're not sort of pulling their punches. They're laying it all out there for anybody who's interested in and reading it. Now, of course, there is the lawsuit out there in which ACLA has challenged FDA's position in court. This is a case that's been filed in the Eastern District of Texas, which is historically been a judiciary that is not one that's been favorable to the government, particularly in cases of perceived government overreach. But no court has addressed this specific legal question before. So it's really a question of first impression. We often get questions about how the end of the Chevron doctrine might improve, might have changed ACL as chances of success here. The viewpoint on our litigators team is that it's the odds of success have probably improved incrementally. But putting the case where they chose to put it in the Eastern District of Texas meant that there was already sort of a favorable judiciary to the extent that that's relevant here. So I think the bottom line for this specific question is that remains uncertain how that lawsuit's going to turn out. And it's not something that's likely to be right, you know, sort of figured out in the short term in so far as the the court calendar has really given driven this decision into early next year at the earliest unless there's some change in the filings. Another question that we receive a lot of questions about is what test is FDA going to choose to down classify when FDA was in the middle of its sort of marketing, what I would call marketing anyway plans for between the proposed rule and final rule to try to get various stakeholders to agree with their position in? Winter of last. Year they indicated they were going to down classify a number of tests, specifically referencing certain infectious disease tests. As well as. Companion diagnostics, that's something that the FDA continues to consider, but the timeline for that remains uncertain. And that's particularly true because in order to down classify tests that have already been classified, they actually have to go through notice of comment rulemaking to do that. So I think what they've said is that they hope to have that finished by the phase four deadline, so the November of 2027. But hard to tell if, for example, if that could come out any sooner or when the proposed guidance or, sorry, proposed rulemaking may come out. Another question we get is whether the final rule will change Congress's or industry's viewpoint on VALID. Short answer is we haven't seen much movement on this point so far. Well, there's certainly more interest in VALID because in some ways it's a more favorable framework to industry in terms of some of the timelines and extended enforcement discretion. Today hasn't moved any further in Congress despite the fact that a number of stakeholders expressed their preference for a valid based framework as composed as compared to what FDA set forth in the final rule. Another question and this is one sort of previewed what I was going to say earlier, but how meaningful the expansion of grandfathering is. You know, this is an area particularly the New York State approval expansion as well as the pre May 6th extension. Those are meaningful exemptions on their face in so far as they create a pathway for a test to remain on the market without complying with those most onerous requirements in phases 3-4 and five or just phases 4:00 and 5:00 depending on the exemption you're relying on. However the FDA does make it clear that they can end enforcement discretion at any time. They're going to have a number of policies in place and where they intend to sort of monitor the claims that laboratories are making about LDTS. And they really do sort of go out of their way to say that they really expect laboratories to be alerting the agency about potential problems with their competitors tests. So it remains unclear how sort of open and effective and active the FDA is going to be in enforcing its requirements on these new types of tests. Furthermore, the grandfathering provisions are written in a way that would apply only insofar as a test isn't modified in a material way. So in a. Way that would trigger the. Requirement for a new submission and recognizing that it's common practice for laboratories to offer their LD TS and make modifications to those tests as new reagents and processes become available. For example, this limitation could leave a lab in a difficult choice, either sort of effectively lock their LDT in their current form or come into compliance with a broader list of FDA requirements. The last slide that I have for you today is to sort of transition nicely off to to what Abigail's going to talk about here is sort of an undercurrent throughout the presentation has been that quality management system compliance is really critical at several key stages of this phased in approach. First, you have the phase one requirements related to complaint handling where as part of your quality system you you'd need to investigate and keep records and try to find root causes for, you know, issues that people raise with the quality of tests during the phase three requirements. So when you're coming into compliance with as a high complexity lab with those sort of limited quality systems requirements, FDA's flag, the design controls, the purchasing controls, the acceptance activities and the Kappas and the other record keeping. Requirements again going to be a. Meaningful lift for laboratories or seeking to ramp up their operations. And then last but certainly not least, even if you have a test that's been subject to enforcement discretion in some way when you're making a modification to those tests. Going to have. To run those modifications through a quality system as well to be sure that those tests are either eligible for continued enforcement discretion or whether a new submissions required if it's a test that doesn't fall within any of those buckets. With that, I'll hand it over to Abigail. Thanks Mike and welcome everyone. I will be discussing what a quality management system is and things for you to consider as you build your QMS in your lab. Note, I know many of you in the audience have experience with different regulations and complying with those regulations. I want to acknowledge that that experience is going to serve you well, and you should leverage that as you work to comply with the new. Rule. So what is a quality management system? On this slide, we have three different definitions. The first one is from 21 CFRA 20 itself. The second definition is from an FDA pharma guide. And the third definition is from ISO 9001. That is an international standard for quality management systems. That standard is agnostic to the types of products or operations that can be applied to. Therefore, it's a universal standard that could be applied in any situation. Now, while the definitions are a bit different in phrasing, in essence they are quite the same. AQMS is the framework or structure that includes processes, procedures, and resources needed to achieve quality assurance. The core of the QMS lies in meeting customer needs and meeting those external requirements. Also on this slide, you'll see a graphic from FD as QSIC Guide. The QSIC Guide is what the field investigators are using when they go in to perform compliance inspections. This graphic depicts how FDA organizes the different requirements in 820 into a QMS structure. FDA identifies 7 subsystems. Those are the darker blue color along with related satellite programs and the light blue note. This is only one way to organize the QMS requirements for a quality system. You will see another way that they can be organized in a few slides. And in regards to terminology, you'll see that in industry QMS, which is quality management system and QS quality system are used interchangeably. I often say QS more often simply because it's easier and quicker to say. So to comply with 21 CFRA 21st, I recommend that you focus on the fundamentals. These elements form the backbone of a compliant QMS. First up, written procedures. Documenting each process in your lab is crucial. Just as crucial. Your employees should be carefully and consistently following those written instructions. As you may expect, during inspections, FDA will likely observe your staff and employees performing their work with the written document in their hand and making sure that each step in each sequence is followed to the T in that work instruction. Next, you'll want to make sure that you have written qualifications for all your staff. Written qualifications often take the shape of job descriptions and you need to be able to readily show that your employees meet the qualifications outlined in those job descriptions. The third fundamental is training materials. You need to maintain comprehensive training documentation and keep records of all the training that's occurring within your lab. That includes new employee training, training after an error has been made in the lab, training on change processes, or just annual refresher training. The 4th fundamental you'll need to make sure is in place is traceability. From the very start to finish, you need to be able to trace completely from incoming materials to samples to software and software versions, to equipment to results and to the end customer, which ties into that 5th fundamental, which is timely and complete record keeping. You'll need to be ensuring that you're recording sufficient details to recreate the work that was done within your lab. You need to be able to recreate that work to the T from today to tomorrow to two years to 10 years from now. So the level of detail to recreate work is obviously very extensive. So those are the top fundamentals for complying with 21 CFR 820 and your QMS. Once you've got the fundamentals in place, you're going to want to focus where FDA focuses. Like you and I FDA has finite resources which have limited time. When FDA comes in to inspect your firm to see if they're in compliance, they will focus on those areas that they believe pose the most risk to public health. So when you. Look, over the years, FDA every year publishes the deficiencies they find during their inspections as well as the frequency of specific deficiencies listed on this slide. These are always the top three areas that FDA is focusing because again, they believe these have the most impact of public health and the areas in which they believe firms and labs need to do a better job. First is corrective and preventative action or Kappa. This is where the FDA expects labs and other manufacturers to figure out why errors and problems happened to fully and quickly address root cause and prevent reoccurrence #2 is complaint handling. That area is where FDA under the QSR requirements requires you to record and have written complaint records and to report the most serious events to the FDA. 3rd, the other area in which FDA is going to focus and we're going to focus much of our portion of the webinar on is purchasing controls. Labs that purchase materials from outside vendors and suppliers must have adequate controls in place. FDA is very familiar and does believe in with the old saying of garbage in, garbage out. So the expectations for purchasing controls is high and you're going to want to be strategic as you move forward to comply with those purchasing controls. So in the preamble, FDA made it very clear that LD TS using materials from third parties, including materials, kits, reagents and instruments must meet those purchasing controls in the QSR. The intent of purchasing controls is to ensure that the selection of suppliers, contractors, and any service providers that your lab uses are being handled with appropriate controls. They do believe that the quality and safety of your final product or output is significantly based upon the quality of those materials and services used within that lab. This is why FDA focuses so highly in this area during every inspection. So let's spend just a minute considering the consequences of poor quality. So poor quality can lead to delays and efficiencies or rework within your lab. It can lead to incorrect results, which can compromise patient care, customer dissatisfaction, damaging the reputation of the lab, and severe cases. It can cause improper treatment or even injuries or death. And it can also, which I'm sure Mike is familiar with, cause legal action. So these negative impacts_the importance of complying with purchasing controls that are outlined in 21 CFR 820. The graphic on the bottom of this slide depicts this closed loop process that many firms adopt. So what does it look like to comply with purchasing control requirements? There are several activities that occur at the start that includes sending and receiving of surveys and questionnaires to potential suppliers or existing suppliers, quality system audits, the establishment of supply and purchase agreements, and the creation of material specification documents and quality agreements. Once you have your suppliers set up and qualified, you begin receiving materials from those suppliers. Incoming materials are inspected and tested against those predefined and approved material specifications as issues identified with purchasing materials, and that can be upon receipt to your lab or later when you're using them in your process. Those issues are addressed with the supplier directly through a Supplier Corrective Action Request Process, or SCAR, per the agreements you set up earlier in the process, suppliers must notify you of changes in their materials, their facilities or their staff so that you can assess if there's any impact to your product or your documentation. Under QSR, you will need to have an overarching program to monitor supplier performance regularly. This often takes the shape of suppliers scorecards being conducted either quarterly, semi annually or annually. And back to the fundamentals that we talked about, you will need to have very detailed and thorough records of how you qualified your suppliers and how you're managing them. So let's talk about purchasing controls in the real world. What does that look like? Well, meeting those QSR requirements is very important and it can turn very burdensome too. Now a good supplier will not disrupt your work and a poor supplier will be a headache and a drain to your work. What you should be aiming for is an ideal supplier. Ideal suppliers are those suppliers that actually make it easier for you to work and they act more like partners and then simply suppliers to you. They focus on relationship management to build long standing connection and business between the two parties. They have comprehensive quality systems and they make it easier for you to actually meet those purchasing requirements outlined in this QSR. You also do need to consider other factors when you're selecting your suppliers. Things like intellectual property, the range of materials and services being offered, pricing is always a consideration, as well as location and any logistical advantages you get from their location. Prioritizing these aspects can be very strategic. One quick example of how you can save yourself time and reduce the administrative burden is thinking about all the different suppliers and the materials that you use in your lab. Imagine say you have 20 materials coming in from the outside. Now if you think back to all those things we just talked about like questionnaires and purchase agreements, quality agreements, materials specs, score, karting. Do you want to do that activity for 20 suppliers for those 20 materials? Or would it be more strategic to do it 10 * 5 times or even one time? So that's where you can turn something from being a very administrative burden heavy process to something being very strategic if you take the time to select your suppliers that are going to be those ideal ones for you. So I'm going to cover one final slide to go a step further into the real world of purchasing controls and actually talk through how Permega has been an ideal supplier to many in this space. So let's start with the notion that an ideal supplier has a robust quality system. As promised earlier, here is a graphic to show how per Mega has organized its QMS. So you'll remember the FDA QC guide, one that had the different circles on how they they organize those different QMS requirements. This is how per Mega has organized theirs. We have a comprehensive process based QMS and that QMS is certified to ISO 9113 forty five, 18385 as well as MD SAP certified. And if you want to read that graphic from the top to the bottom, management sets the direction, resources are deployed, product is realized and released to the market. Then information and data is collected and analyzed to identify ways to improve. And then the cycle starts again is that information is fed back into management and across all these processes, documents and records, change control and risk and opportunities are applied. I should note that Permega is also registered with the FDA as a manufacturer, contract manufacturer and specification developer. So we know first hand what it's like to comply with the QSR requirements including purchasing controls. Now while it will not eliminate FDA from examining your purchasing controls, it will certainly help that per mega complies with the QSR requirements already and we've had very successful recent FDA inspections. So let's go back to the elements required for the QSR requirements and how per mega can actually ease you with those purchasing control requirements. So remember we talked about that sending and receiving of surveys to put in the supplier file to show the qualifications. Permega does that either with your specific survey or with providing you our own existing information sheet for your files. In regards to quality system audits, we host many audits including FDA, our registrars and customers throughout the year. We offer those both remote and on site to assess our facilities and our QMS. We have an easy way to establish agreements, including quality agreements. We can use a customer's existing quality agreement template or we have a template that's readily available and able to fill in with your specific needs. We also have ways to help you with create creating those material specification documents. We have standard C of as custom C of as as well as custom in house QC testing depending on what your needs are. And lastly, Permega offers over 4000 catalog products including reagents, kits, and equipment. And if you need something specific for your lab, we have a customs group ready to meet your needs. So yes, Permega has much to offer, especially with those labs looking to comply with the new QSR requirements. With that, I'm going to conclude my portion of the webinar. I appreciate your time and being given the opportunity to share with you information about the QMS requirements and how you can strategically meet those. With that, I'm going to hand it back over to Carly for our Q&A portion. Thanks, Abby. Thanks, Mike for the comprehensive information. We'll now move on to our live Q&A session. We'll get through as many questions as we can. If we don't get to your question, we will absolutely follow up after today's webinar. So the first question is I have two that are similar, so I'm going to ask them together. How should users of commercial research use only kits conform with the FDA final rule if the vendor doesn't submit to the FDA? The second related question is can RUO products? Be used as components and LDT kits. So the answer here is that the FDA explicitly addresses this in the preamble to the final rule. In short, there's no prohibition on using RUO labeled materials as part of an LDT that would be submitted. To the FDA. But FDA does make clear that a lab that uses those materials as part of its own test be required to qualify those and basically bring those in under its own quality system. Thanks, Mike. And while I have you another question for you, is it naive to not take any action towards compliance due to assuming the lawsuit will be successful in changing the FDA ruling? It's a question we're getting quite a bit and really one that's sort of hard to to map out. You know, there's now, I think at the time we recorded the webinar, there was just one lawsuit. There's no two with the AMP lawsuit. What I'd say is that this is a from a legal perspective, this is an issue that you said in the webinar nobody has really addressed before, no courts address. So whoever gets there first, either the Eastern District of Texas or Southern District of Texas is going to be the 1st court to make that decision. So I think while I think both sides believe they have solid arguments, the FDA on the one side, ACLA and AMP on the other side, I think it's hard to predict exactly how court's going to land. I think it is entirely possible, right? That you know you could spend some time and money trying to build up a quality system. That you may not. Need if the rule gets thrown out at the same time, it's also. I don't know it's equally possible, but certainly possible. The FDA could win. Right. And then labs that are prepared or haven't prepared to find themselves behind the 8 ball, particularly as you start to move into some of the more onerous requirements like the the phase three requirements for quality systems are phase four and five with the pre market review submissions. So ultimately, I think it's a decision each lab unfortunately needs to make on its own based on sort of their risk tolerance and resources you have available. Thank you, Mike. Question for you, Abigail. Does inspection of purchasing controls require the manufacturer supply the criteria by which the purchasing controls are qualified upon receipt? Are manufacturers held to a standard template for end user qualification of received purchasing controls? So if I understand the question, Carly, so regarding in short, there's no standardized way in which customers or suppliers have to provide that information on those products. So as a receiver of purchase materials, you need to define what is important for those materials and confirm that those meet those specifications as they are received and to be used in your lab. So there is not a standard format that you need to use for your material specification documents. You do need to have those predefined and stated what your requirements are. And then as a supplier to customers, oftentimes you will receive information like a certificate of analysis or conformance that has that information you need to confirm that that product meets your requirements. So there's a variety of different templates used in the industry, but in general it talks about what the specifications are for the material or the kit and then that supplier ships or provides on a website like Promega does those certificates of analysis and conformance. I hope that answers the question on no standard template, but the standard elements needing to be what's required by your lab and then the vendor should be providing that information. You need to be able to check the. Box that it meets those requirements. Great. Thanks, Abigail. And so while I have you, how would you recommend implementing purchasing controls with an established vendor? Very good. So yes, many of you are already working. You're already receiving materials from different vendors and suppliers. This is where I would recommend you do a couple things. First, do that like we talked a little bit earlier, be strategic. Consider if those are the vendors you want to move forward with. Think about if you want to consolidate to a different vendor. So again, do I want to do 20 times do qualifications for karting scars or do I want to work with a fewer number of suppliers and vendors and how easy are they to work with? FDA is not a huge fan of grandfathering in, if you will, existing suppliers, you may have some success there, you may not, probably depends on how well you do at that monitoring phase. So if you could start to implement scorecarding or other ways to monitor their performance, you can justify. They've been a long standing vendor and I periodically, whether it's quarterly by annually or annually assess the quality of the materials as well as their performance. That might be a way to grandfather them in. In general, I'd recommend to at least do some, even if it's a focused or cursory kind of qualification where it's like again, you reach out to maybe you're buying per mega products now you don't have a qualification file. Go ahead and follow up and do at least a basic qualification file showing that we are certified, we are registered and provide that history of high performance of the materials you have been receiving. Thank you, Abigail. Mike, question for you. Could you expand on what you meant by the FDA relying on competitor complaints or reports? Yeah. So this is again some more language from the preamble, the final rule, it's clear from the final rule that FDA is an organization limited resources, the group at CDRH responsibility for devices historically been much smaller than the drug group. They are, of course, planning to hire, but regardless, they're going to have to prioritize their activities. So one of the things that they're hoping to do and indicated that they expect laboratories to do to one another is to call out, you know, sort of aggressive marketing practices where labs are making claims about the performance of their tests may not be backed up by the data. The FDA also plans like as I mentioned before, to ask for companies to submit labeling information just going to get a give FDA a real. Look under the hood in terms. Of what types of claims that labs are making about their tests? I think like FDA has long received complaints from 1 manufacturer to about another or one. Laboratory about another so they aren't I think they do take these. Complaints with a grain of salt, but it was interesting to see it specifically called out as something that FDA will be looking for as it tries to figure out what what sort of enforcement action to prioritize over the next few years. Thank you, Mike. So assuming labs are using RUO components, why not push back on the RUO community to develop Ivds instead? I mean, I don't know if that's for me, Carly or for Abigail. I could take a stab at it. The short answer is nothing about that's certainly one option for customers right is to decide they don't want to develop an LDT or prefer to use an IBD kit. Nothing about the proposed or the final rule changes the regulatory status of REO products. So that REO guidance from November of 13 remains sort of FD as current and accurate statement about how those products can be marketed and nothing about the the final rule changes any of the. Content or FDA's? Position on that. Thank you, Mike. Question for you, Abigail. Two that are sort of similar. Do do purchasing controls apply to vendors that provide services such as equipment maintenance or calibration? And does purchasing controls apply to software used within an LDT? Yes. And yes, so good question. So yes, when we think about purchasing controls, they do consider that materials coming in, service providers being used or contractors, even staff that are contractors and consultants. So all of those. So if it's somebody external from your lab or your firm in which you are using them related to this, they should have, they should be meeting the purchasing controls outlined in the QSR. Great. Thank you. Question for Mike. What does the FDA consider as a label for a clinical test? Does information in a test? Is information in a test catalog sufficient, and what kind of information must be included? Another great question, one that FDA is absolutely going to be putting out more guidance about, particularly for a lab developed test, the concept of a label doesn't work as neatly as it does for something like a kitted test that would be sold by a manufacturer. In short, really as we understand it, it's things like catalogs as well as you know, instructions for use, test reports and other sorts of materials that are used to market the test. So website postings, clinical documentation, items that are used at trade shows and the like. Thank you. Question for Abigail, Does Promega plan to provide documentation for products that are marketed as solely for forensic use if they are used clinically by some clients? So similar to I would say the RUO type. Products. So all the products being manufactured under Permega are meeting all the different certifications and regulations we have to comply. So while those forensic grade products similar to our RUO products have not been tested in a clinical setting, there is nothing preventing our customers from validating those assays as part of meeting their design control requirements that are being applied under the new. Rule. So similar to the RUO products, forensic grade products provide the product technical information as well as you know can see if we can meet your material specifications needs. So those would be very similar to the RUO products that we talked about just a few minutes ago. Great. Thank you so much. Well, it looks like we are at the top of the hour, so I wanted to say a huge thank you to Abigail and Mike for presenting this information today. If you have any questions or if we did not get to your question, Abigail or Mike will follow up with you individually. So on the screen, you should see the contact information. Feel free to reach out to Pramega or Mike at McDermott. And thanks everyone for joining us today. It was a pleasure. And with that, we will conclude the webinar. Thank you. _1734851909528