Inside Track: Industry Association Gets a New Chair

AdvaMedDx looks to promote the critical role of diagnostic testing

Interview by Steve Halasey

At the beginning of April, diagnostics industry association AdvaMedDx, Washington, DC, announced the appointment of Eric B. Compton, MBA, chief operating officer at Hologic, Inc, Marlborough, Mass, to a 2-year term as chairman of the organization’s board of directors.

Compton is well known in the diagnostics industry. From 1995 to 2014 he worked at Johnson & Johnson in roles of increasing responsibility including worldwide president of Ortho Clinical Diagnostics. In that position, he was accountable for more than $2 billion in global sales across multiple disciplines and held direct responsibility for a workforce of more than 2,800 individuals. Prior to joining Johnson & Johnson, he was a business development manager at Procter & Gamble, where he began his career as a sales representative in 1986.

Compton has also been active in representing the diagnostics industry. He served on the AdvaMedDx board from 2012 to 2013, while he was with Ortho Clinical Diagnostics, and from 2015 to the present, while with Hologic. “It is an honor to extend my tenure on the board in this new position, particularly as AdvaMedDx continues to promote the critical role of diagnostic testing in achieving healthcare cost savings and better patient outcomes,” he says.

“AdvaMedDx is privileged to have Eric leading our board as chair,” says Andrew C. Fish, JD, chief strategy officer at parent organization Advamed. “His experience and depth of knowledge in the diagnostics industry make him an excellent choice for this important position as we tackle the challenges of the next 2 years.”

Compton succeeds John L. Bishop, former chairman and CEO of Cepheid, who led the organization through passage of the Protecting Access to Medicare Act of 2014 (PAMA) and ongoing work on diagnostic regulatory reform.¹

“We’re grateful for the direction and guidance that John provided to AdvaMedDx during his chairmanship,” says Fish. “As one of the original, founding members of the AdvaMedDx Board, John assumed leadership during a time of significant policy work by the association and shortly before the Protecting Access to Medicare Act was enacted, which included historic diagnostic test payment reforms. His steadfast commitment to the association’s work on diagnostic regulatory reform helped to lay a solid foundation for future progress.”

Of his new position with AdvaMedDx, Compton remarks, “I look forward to working closely with the talented AdvaMedDx team and our diverse membership to advance sensible public policy that improves access to accurate, reliable, and innovative medical technology and enables people to live longer, stronger, and healthier lives.” CLP recently spoke with Compton to find out more about current and future policy initiatives that AdvaMedDx expects to advance. 

CLP: Reimbursement is often cited as the number-one issue affecting both in vitro diagnostics manufacturers and clinical laboratories. To what extent will PAMA’s market-based pricing system resolve this issue?

Eric B. Compton, MBA: AdvaMedDx has continuously worked with key stakeholders on payment reform and Medicare fee schedule modernization that recognizes the full contribution of modern diagnostics to healthcare quality and outcomes, as reimbursement challenges can dampen the incentive for new test development.

Most recently, AdvaMedDx supported the development of the legislative initiative to revise the way clinical diagnostic laboratory tests are paid by Medicare, leading to passage of PAMA and representing the first major reforms to the way payment amounts are established and updated on the Medicare Clinical Laboratory Fee Schedule (CLFS) in more than 30 years. The new payment system will link Medicare payment rates under the CLFS to the rates paid for laboratory tests in the private sector.

Unfortunately, while we worked closely with the Centers for Medicare and Medicaid Services (CMS) toward PAMA implementation, we believe that under the current regulatory requirements, the new program will not accurately reflect private market rates for clinical laboratory services.

CMS recently announced that the period for reporting payment data will be extended for 60 days, and AdvaMedDx is working to ensure our concerns are addressed before implementation of new payment rates.

CLP: Some analysts have suggested that a value-based approach to evaluating diagnostic tests would be an appropriate method of establishing reimbursement rates for clinical laboratory testing. Is that an approach AdvaMedDx would support?

Compton: As the US healthcare system increasingly shifts away from fee-for-service payment systems and moves more toward value-based models of care, diagnostic test developers, including manufacturers and laboratories, are increasingly under pressure to demonstrate the value of their products to a range of stakeholders, including physicians, providers, payors, and patients.

AdvaMedDx supports a value-based approach for assessing diagnostic tests and technologies, and in fact, this has been a key focus of the association for several years.

For diagnostics, there are unique challenges associated with demonstrating the value of a test, because their value is based on the ability of a test to provide critical information to healthcare decisionmakers, including patients, to guide care and treatment. To help manufacturers and other diagnostic test developers understand and face the challenges of our changing healthcare system, AdvaMedDx has developed a value assessment framework for diagnostic tests that will be rolled out over the next few weeks.

CLP: The Centers for Medicare & Medicaid Services (CMS) has permitted one of its Medicare administrative contractors (MACs)—Palmetto GBA—to establish reimbursement policy that has subsequently been followed without review by other MACs—notably affecting reimbursement for molecular diagnostics. Do you know the status of this program? Does CMS intend to expand the program nationwide?

Compton: Palmetto GBA administers the MolDx program, which establishes coverage and reimbursement for molecular diagnostic tests. To date, three other MACs (CGS, Noridian, and WPS) have agreed to administer the MolDx program in the states they cover, affecting labs and hospitals that bill Medicare for molecular diagnostic tests in about 25 states. We understand that CMS has not determined how the MolDx program could be further expanded.

AdvaMedDx has been generally supportive of certain elements of the MolDx program, such as revised coding to identify specific tests, and somewhat improved transparency relative to previous practices. The association has worked with its member companies to understand and provide input into this program as it has evolved over the past 5 years.

On another related note, AdvaMedDx, and AdvaMed more broadly, has supported legislation that would improve Medicare’s local coverage determination process by ensuring adequate transparency in the process and that stakeholders have opportunities to participate in the process and comment on proposed local coverage policies. CMS has encouraged MACs to coordinate their decisions, which could effectively turn a local coverage determination made by one MAC into a de facto national coverage determination, if other MACs simply adopt their decisions. As we’ve seen with the MolDx program, a local coverage decision from Palmetto affects half of the country. AdvaMedDx supports policy proposals that would ensure fairness in these processes.

CLP: FDA has been very active in developing guidance documents for the regulation of advanced diagnostics such as next-generation sequencing assays and companion diagnostics. Are such guidances helping to reduce regulatory obligations and time to market—or the opposite?

Compton: FDA has been making strides in improving the regulatory process for diagnostics, including new approaches to support the regulatory review process and advance personalized medicine. The recent companion diagnostic and next-generation sequencing guidances provide helpful clarity on FDA thinking about regulatory approaches, types of study designs, use of well-curated databases to support submissions, and willingness to consider more flexible evidence approaches for new technologies that are helping to support precision medicine.^2–5

As we move to a modernized regulatory framework, we would like to see wider adoption of these proposed approaches to the diagnostic regulatory process to better leverage the latest science and flexible evidence models, and support overall innovation in safe and effective diagnostics. This will help maintain the pace of developments in the field and help support access to new critical diagnostics for patients.

CLP: AdvaMedDx has taken the position that laboratory-developed tests should be subject to FDA regulation just as commercial tests are. What type of regulatory procedures does the organization favor for accomplishing this goal?

Compton: AdvaMedDx has long supported FDA oversight of all diagnostics, including laboratory-developed tests (LDTs), under a risk-based approach that promotes public health, patient safety, and innovation.

We are very pleased by congressional interest in addressing longstanding questions about LDT regulation in the context of broader diagnostics reform legislation that would improve the regulatory process for all test developers. Both the Senate and House have indicated an intention to take up this issue this year, and AdvaMedDx fully supports these efforts. This is the right time to move forward on comprehensive legislative reform to ensure patients have robust access to innovative and high-quality clinical diagnostics, whether developed by manufacturers or laboratories. We are encouraged by the House discussion draft of the Diagnostic Accuracy and Innovation Act, and look forward to legislative action in the coming months.⁶

We recognize that any new oversight framework for diagnostics will require collective input and work on the part of a range of stakeholders. We are committed to working with Congress, laboratories, patient groups, and others to see reforms enacted in 2017.

CLP: Broadly speaking, how would you gauge the current pace and direction of technology development for clinical diagnostics? Are there any obstacles preventing researchers from making progress in areas thought to have significant promise?

Compton: The pace of technology development in the diagnostics space during the past decade has been rapid, which has made it an exciting and rewarding arena to play in. My company, Hologic, has done its part by bringing new diagnostic assays to market rapidly, in response to emerging threats to public health. In June 2016, for example, we received an emergency use authorization from FDA for our Aptima Zika virus assay for detection of Zika infection in symptomatic or at-risk individuals—a test we were able to introduce on an accelerated timeline of several months following the alarming outbreak in Brazil.

In addition, the diagnostics space is seeing rapid adoption of next-generation sequencing technologies as well as development of unique, new sequencing methodologies and innovation in point-of-care diagnostics. It will be very exciting to see how market and policy forces shape the adoption of these new technologies in the coming years.

CLP: To what extent should federal health agencies play a role in guiding researchers and providing resources to support the development of novel diagnostics? Will such activities be possible if proposed budget cutbacks are enacted?

Compton: Federally funded life sciences research is an important contributor to the growing base of biological knowledge that supports the development of innovative diagnostics that can bring new information to bear on critical health conditions. In the area of genetics and genomics, for example, the discovery of new molecular pathways associated with various diseases, such as cancer, provides new diagnostic targets (biomarkers) for which tests can be developed and deployed for clinical use. AdvaMedDx supports continued National Institutes of Health funding for this kind of important research, and we would not want to see funding cuts that would slow the pace of scientific discovery.

CLP: Diagnostics are often seen as the first line of defense against pandemic outbreaks of disease—including the rise of antimicrobial-resistant organisms. Is the diagnostic community doing all it can to fulfill this role?

Compton: AdvaMedDx has long recognized the role that diagnostics can play in fighting infectious diseases, and test manufacturers are continually advancing and developing diagnostics to match the evolution and emergence of new infectious diseases. Recent advances enable healthcare providers to reach a diagnosis more quickly, improving patient outcomes and lowering associated healthcare costs.

Infectious bacteria that are impervious to antibiotics are increasingly a global threat, with a substantial impact on patients, healthcare systems, and economies worldwide. Current trends project antibiotic resistance could cause up to 10 million deaths annually by 2050.

Diagnostic tests have the capacity to reduce inappropriate antibiotic use by identifying non-bacterial infections, expediting diagnosis and treatment decisions, and guiding antimicrobial treatment selection through antibiotic susceptibility tests. Additionally, diagnostic tests support early detection and diagnosis of drug-resistant infections, enable effective disease surveillance and outbreak monitoring, and help prevent the spread of resistant organisms.

AdvaMedDx recently announced a global stakeholder initiative to optimize the use of diagnostic tests in the fight against antimicrobial resistance.⁷ The global initiative is based on a stakeholder statement of commitment that serves as a framework for collaborative action, outlining specific goals for leveraging existing diagnostic solutions and investing in improvements and access.

We hope this effort will help to reduce the threat of antibiotic resistance and improve the quality of care for affected patients around the world.

CLP: In recent years, diagnostics manufacturers have become increasingly attuned to the public health need for diagnostics that can be employed in resource-poor settings throughout the world. What do you see as the future of diagnostic test development for such applications?

Compton: The diagnostics industry continues to develop new and innovative tests that play a critical role in all healthcare settings, including low-resource settings. Point-of-care tests, for example, require less training to operate, use equipment that can be more portable, provide test results faster, and provide results in settings closer to the patient. Mobile communications technology also can be built into point-of-care tests to facilitate test result reporting; this can be a critical capability for countries in which cell phones may be the most well established communications infrastructure. These types of tests can be highly useful in developing countries with less access to trained personnel and the resources it takes to operate a fully equipped laboratory. These tests also can help bridge gaps in healthcare access in those countries by bringing diagnostics services directly to patients who may not be able to travel long distances to the nearest major healthcare facility.

CLP: As the incoming chair of AdvaMedDx, what tasks would you most like to see the organization take on during your term of office?

Compton: I would like to see AdvaMedDx speak out to reinforce the value of diagnostics in the continuum of care. All healthcare decisions, such as selection of treatment protocols, depend upon accurate and specific information about each patient’s condition, and this knowledge is provided by diagnostic tests. Therefore, reimbursement must accurately reflect the true value of these tests to healthcare. Also, AdvaMedDx will work to ensure that regulatory processes and oversight are appropriate for diagnostics, rather than applying other models (such as those developed for medical devices) to the approvals process.

Steve Halasey is chief editor of CLP.

References

1. Protecting Access to Medicare Act of 2014. PL 113-93. Available at: www.gpo.gov/fdsys/pkg/plaw-113publ93/pdf/plaw-113publ93.pdf. Accessed April 17, 2017.

2. In Vitro Companion Diagnostic Devices. Guidance for Industry and Food and Drug Administration Staff. Silver Spring, Md: Center for Devices and Radiological Health, Center for Biologics Evaluation and Research, Center for Drug Evaluation and Research, FDA, 2014. Available at: www.fda.gov/downloads/medicaldevices/deviceregulationandguidance/guidancedocuments/ucm262327.pdf. Accessed April 30 2017.

3. Principles for Codevelopment of an In Vitro Companion Diagnostic Device with a Therapeutic Product. Draft Guidance for Industry and Food and Drug Administration Staff. Silver Spring, Md: Center for Devices and Radiological Health, Center for Biologics Evaluation and Research, Center for Drug Evaluation and Research, FDA, 2016. Available at: www.fda.gov/downloads/MedicalDevices/DeviceRegulationandGuidance/GuidanceDocuments/UCM510824.pdf. Accessed April 30, 2017.

4. Use of Standards in FDA Regulatory Oversight of Next-Generation Sequencing (NGS)-Based In Vitro Diagnostics (IVDs) Used for Diagnosing Germline Diseases. Draft Guidance for Stakeholders and Food and Drug Administration Staff. Silver Spring, Md: Center for Devices and Radiological Health, Center for Biologics Evaluation and Research, FDA, 2016. Available at: www.fda.gov/downloads/medicaldevices/deviceregulationandguidance/guidancedocuments/ucm509838.pdf. Accessed April 25, 2017.

5. Use of Public Human Genetic Variant Databases to Support Clinical Validity for Next-Generation Sequencing (NGS)-Based In Vitro Diagnostics. Draft Guidance for Stakeholders and Food and Drug Administration Staff. Silver Spring, Md: Center for Devices and Radiological Health, Center for Biologics Evaluation and Research, FDA, 2016. Available at: www.fda.gov/downloads/medicaldevices/deviceregulationandguidance/guidancedocuments/ucm509837.pdf. Accessed April 25, 2017.

6. Diagnostic Accuracy and Innovation Act [discussion draft]. Available at: https://bucshon.house.gov/sites/bucshon.house.gov/files/documents/daia%20discussion%20draft.pdf. Accessed April 30, 2017.

7. Global commitment on diagnostic tests to fight antimicrobial resistance. Washington, DC: AdvaMedDx, 2017. Available at: https://dx.advamed.org/sites/dx.advamed.org/files/resource/globalcommitment-mar17.pdf. Accessed April 30, 2017.