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Default Regulators Take Aim at Infant DNA-Testing Industry

Gov. Arnold Schwarzenegger told the crowd today at BIO, the world's largest biotechnology conference, "If you have anything to do with biotech, California is one of the best places to set up shop."
But the actions and tough talk of his public health department have biotech companies in one of the most promising areas of the field -- genetic testing -- questioning whether they can do business in the state at all.
Last Monday, the state's laboratory field services group issued 13 cease-and-desist letters to genetic testing companies. Wired.com obtained a copy of the letters (pdf.) from two recipients. And a recent teleconference among regulatory officials confirms the seriousness of the department's intent.
"We [are] no longer tolerating direct-to-consumer genetic testing in California," Karen Nickles, Chief of Laboratory Field Services at the health department, told members of the Clinical Laboratories Advisory Committee on June 13.
Targeted companies include personal genomics startups 23andMe and Navigenics. These services are seen as the leading edge of a new type of health care in which consumers can use their genetic profile to tailor their medical and lifestyle choices. The established medical community, however, is wary of the technology arguing that the medical utility of some tests is unproven. Doctors also complain that direct-to-consumer services bypass them as the gatekeepers and analysts of medical information, which they worry could confuse consumers, not to mention cost them a billing event.
The health department's actions are a direct challenge to the viability of the infant DNA-testing industry, for which physician involvement is shaping up to be a major battleground. As far back as a September 2006 meeting, health department officials were voicing concerns over "nutrigenetic tests that analyze a limited number of genes to give personalized nutritional and lifestyle recommendations."
But genetic testing companies say they are "information services" that simply provide data about their customers' DNA. Genetic testing companies argue that they should be subject to a similar level of oversight as over-the-counter tests, like those available for determining paternity. Only New York requires a prescription for a paternity test.
The cease-and-desist letter, signed by Nickles, cites seven California statutes, beginning with the Business and Professions Code Section 1241, which requires that "all clinical laboratories in California ... possess a clinical laboratory license."
But the letter's strongest wording is reserved for a section of the law, Business and Professions Code Section 1288, which requires a doctor's note for all laboratory tests, unless, like pregnancy tests, they are specifically exempt from that law.
"Genetic tests are NOT exempt," the letter reads. "As such, the test must be ordered by a physician or surgeon."
Kristine Ashcraft, director of operations for another genetic testing company, Genelex, which was not sent a cease-and-desist letter, criticized New York's policy and the application of that framework to genetic testing in California.
"All they've done is created an extra billing event for the doctor," Ashcraft said.
As Navigenics CEO Mari Baker put it, "You hope [the health department officials] understand the difference between a genetic risk assessment and a diagnostic test."
Nevertheless, Baker says that her company has taken pains to involve a California-licensed physician in its process. Furthermore, she stated that her company outsources its laboratory work to Affymetrix, which does possess a licensed clinical laboratory in California. Affymetrix, we confirmed with a company source, was not served with a cease-and-desist letter.
In a June 13th health department conference call, officials stated that 25 "genetic businesses" were part of an extensive investigation.
In a summary of the regulatory action, Nickles said that 13 companies were to immediately cease testing and "desist from ever doing it again."
Nickles added that the state had talked with the state of New York, which sent similar letters, and looked forward to federal regulation.
While Nickles took issue with the testing business, she said that "public interest in personalized medicine" was driving the use of genetic information.
Though the health department has stated that the investigation of genetic testing companies came as a result of "multiple" consumer complaints -- no specific incidents were mentioned in the call.
DNATraits.com managing partner Bennett Greenspan, whose company received a letter from the health department, said that he didn't believe that consumer outcry sparked the investigation.
"If we could find out who put the bee in their bonnet, my guess it's the medical community," Greenspan said. "I think that the medical community doesn't want to lose control of who orders the test."
Reporter's note: No transcript or online version of the June 13 call is available, but interested parties can call 866-837-8032 and enter Access 123-9562 until July 8th to listen to a recording of the whole three-plus-hour call. (Be forewarned: There's no skipping ahead, and the genetic testing discussion follows a variety of procedural discussions before it gets to the relevant information.)


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