Short answer
Diagnostics commercialization plans usually treat the regulatory category — FDA-regulated IVD vs. CLIA-regulated lab-developed test — as fixed background. It isn't. FDA tried to fold LDTs under device regulation in 2024, a federal court vacated that rule in 2025, and FDA rescinded it later that year. The fix isn't predicting which way the category lands; it's building the commercial plan around the parts that are actually stable: the coding, coverage, and ordering-workflow path, not the regulatory label.
The rollercoaster, in order
| Date | Event |
|---|---|
| May 6, 2024 | FDA finalizes a rule amending the definition of "in vitro diagnostic products" to explicitly include tests manufactured by a laboratory, bringing LDTs under device regulation with a phased, four-year enforcement timeline |
| March 31, 2025 | U.S. District Court for the Eastern District of Texas vacates the rule in full, ruling in ACLA v. FDA and the consolidated AMP v. FDA that LDTs are professional laboratory services governed by CLIA, not devices under the FDCA, and that FDA exceeded its statutory authority |
| May 2025 | HHS's deadline to appeal passes without an appeal being filed, leaving the vacatur as the final word |
| September 18–19, 2025 | FDA issues a new final rule formally rescinding the 2024 rule and reverting the IVD definition to its pre-2024 language |
Two reversals, one statutory question, sixteen months. As one clinical lab leader, Dennis Dietzen of Phoenix Children's Hospital, put it after the March 2025 ruling: "We can all breathe a sigh of relief, but it will be a short breath." A version of the underlying policy attempt, the VALID Act, has already been introduced in Congress once and failed to pass, and nothing prevents another version showing up. Source: myADLM, April 2025.
Why this hits diagnostics harder than devices
A cleared device's regulatory status doesn't change after clearance. A diagnostic test's regulatory status just did, for an entire category, twice, without any company's product changing. That's a structurally different kind of risk than the ones covered in medtech fundraising by stage or the graveyard manifesto: not a company misjudging its category once, but the category itself being institutionally unsettled.
It also compounds an existing diagnostics problem: more stakeholder fragmentation than a device sale. The orderer, the specialist who acts on the result, the lab director, the payer, and the patient are frequently four or five different people, and each one's willingness to engage can shift depending on which regulatory and reimbursement regime the test currently sits under.
What actually stays stable
Regulatory classification moved twice. What didn't move: whether a test has a specific reimbursement code, whether it fits inside an existing ordering workflow, and whether a payer has a coverage policy for it. Those three are the load-bearing commercial questions, not the CLIA-vs-FDA label. Two examples of companies that built commercial access around the workflow layer, which held steady through all of this:
Neither integration depended on how LDTs were classified. Both would have kept working exactly the same way through the 2024 rule, the 2025 vacatur, and the 2025 rescission, because they were built on the ordering workflow, not the regulatory label.
Failure modes specific to an unstable category
| Failure mode | What it looks like |
|---|---|
| Building the sales pitch around the label | A commercial narrative that leans on "FDA-regulated" or "CLIA-only" as a selling point is one policy reversal away from being wrong |
| Treating enforcement discretion as permanent | Enforcement discretion is a posture, not a law. It has already changed once against the industry's expectation and once in its favor |
| No coding or coverage story independent of classification | If the reimbursement pitch only works under one regulatory regime, coverage risk is now tied to litigation and rulemaking timelines the company doesn't control |
| Underinvesting in workflow integration because "the science should speak for itself" | The Myriad and Guardant examples above are wagers that ordering friction, not classification, is the actual adoption bottleneck. The rule reversals suggest that wager was right |
| Assuming this is settled | It has reversed twice already in the current cycle. A third move, from a future FDA or from Congress via something like the VALID Act, is a live possibility, not a tail risk |
What to build instead
- 1
A classification-aware coverage and coding memo
Be explicit about which parts of the coverage and coding story depend on LDT-vs-IVD classification and which don't, so a future reversal only threatens the parts that were always contingent.
- 2
Workflow and EHR integration as a primary investment
Not a nice-to-have layered on after the science is proven — it's the one lever that survives a classification change.
- 3
A standing watch on the VALID Act and successors
Legislation is the mechanism most likely to reopen the question, and Congress, not FDA, would have to resolve it.
- 4
A clinical-utility story built for payers and committees
Build the evidence case independently of whatever the current classification implies about scrutiny.
Where RevWorx fits
RevWorx today is built around the medical device commercialization motion: hospital committees, CRM and calendar context, a device-specific account intelligence model. Diagnostics is a genuinely different data problem — orderer behavior, LIS and EHR integration signals, and payer coverage policy at the CPT-code level, rather than hospital procurement committees. Diagnostics will require a different motion but the same discipline applies: build commercial plans that consider coding, coverage and workflows.
Related reading: The Graveyard Manifesto · Coverage Before Contracts. This is a thought-leadership brief, not regulatory or legal advice. Regulatory status, coverage policy, and pending legislation should be verified against current primary sources before being used in a live commercial or fundraising decision.
Frequently asked questions
- Are lab-developed tests currently regulated by the FDA?
- No. As of the FDA's September 2025 rule, LDTs are governed by CLIA and CMS, not FDA device regulation. This reverts to the position that existed before FDA's May 2024 rule, which a federal court vacated in March 2025.
- Could FDA try to regulate LDTs again?
- Possibly, either through new FDA rulemaking or through legislation like the VALID Act, which has been introduced before without passing. The underlying policy debate wasn't resolved, only the specific 2024 rule.
- Does this affect IVD kits sold to multiple labs, or only tests developed and run within one lab?
- The rule and the litigation concerned tests designed, manufactured, and used within a single laboratory (LDTs). Commercially distributed IVD test kits used across multiple labs were not the subject of this back-and-forth and remain FDA-regulated devices.
- What should a diagnostics company do differently because of this history?
- Build commercial and reimbursement plans that don't depend on the current classification holding. Coding, coverage, and workflow integration are the stable levers; the regulatory label has proven it can move.