* Agency says wants proof of Pathway test approval
* Test was to be sold in Walgreen drug stores this week (Recasts, adds Walgreen comments)
CHICAGO, May 12 (Reuters) - Walgreen, the nation's biggest pharmacy chain, says it will delay plans to sell genetic testing kits after the U.S. Food and Drug Administration demanded proof the kits have regulatory clearance or some reason why they should be sold without the agency's blessing.
The FDA on Wednesday released a May 10 letter to privately held Pathway Genomics Corp over its saliva genetic test saying the agency was "unable to identify" FDA approval for Pathway's Genetic Health Report.
U.S. pharmacy chain Walgreen WAG.N said on Tuesday it planned to start selling Pathway's genetic testing kits to help people assess their risk for inherited diseases, making it the first U.S. drug store chain to put such tests in local pharmacies.
But the company has now decided to put the kits on hold.
"In light of the FDA contacting Pathway Genomics about its genetic test kit and anticipated ongoing discussions between the two parties, we've elected not to move forward with offering the Pathway product to our customers until we have further clarity on this matter," Jim Cohn, a Walgreen spokesman, said in an e-mail on Wednesday.
Pathway has said its personal genetic testing kit, the Pathway Genomics Insight Saliva Collection Kit, can be sold without FDA clearance because it is not intended for use in diagnosis, treatment or for the mitigation or cure of a disease -- qualities that would make it an in vitro medical device, which the FDA does regulate.
Pathway's test contains a small saliva collection kit, instructions and a postage-paid envelope customers can use to send their sample back to the Pathway lab.
Then, consumers go on the company's website, www.pathway.com, to order a customized report about their genetic make-up, with prices ranging from $79 to $249.
The reports give consumers genetic information on more than 70 health conditions, including a person's response to some prescription drugs, their propensity for diseases and whether they could pass any inherited diseases on to their children.
Consumers are meant to use this information to modify their lifestyles.
"The Genetic Health Report appears to meet the definition of a device as that term is defined in section 201(h) of the Federal Food Drug and Cosmetic Act," according to the letter signed by James Woods, deputy director of patient safety and product quality in the FDA's Office of In Vitro Diagnostic Device Evaluation and Safety.
NEED FOR COUNSELING
Several groups have raised concerns over the sale of such test kits directly to consumers, noting such tests offer incomplete information and any results about disease risk, especially for incurable diseases such as Huntington's or Parkinson's, should only be done with counseling that clearly explains the limitations of genetic testing.
The American Clinical Laboratory Association on Wednesday urged consumers to seek the guidance of their doctor or other health care provider before using direct-to-consumer genetic tests to ensure proper understanding of the results and appropriate follow-up.
"Many direct-to-consumer genetic testing companies are not testing individuals for disease -- they are testing for the propensity of developing disease conditions," Alan Mertz, president of ACLA, said in a statement.
"Although such testing can offer useful information, it requires clear and personal communication between patients and healthcare providers so that steps can be taken to limit the likelihood of developing disease and control its effects."
Scientists have only a limited understanding of genes that contribute to complex diseases, such as heart disease or diabetes, and several studies have shown that using genetic information is much less effective than factors such as family history at predicting a person's risk of developing these diseases. (Additional reporting by Susan Heavey in Washington and Jessica Wohl in Chicago; editing by Cynthia Osterman and Todd Eastham)