OTC COVID-19 Tests Have Abbott Seeing Continuing Demand For At-Home Diagnostics

OTC COVID-19 Tests Have Abbott Seeing Continuing Demand For At-Home Diagnostics

Source : 'HBW Insight'

The coronavirus pandemic prompted Abbott Laboratories Ltd.’s development of an OTC test for the COVID-19, meeting consumer demand that it anticipates will continue and make diagnostic tests common items in US medicine cabinets.

“We see this is a as a significant opportunity, and quite frankly, a trend that's been happening overseas and is kind of now happening here in the US,” said president and CEO Robert Ford during Abbott’s first-quarter earnings briefing on 20 April.

Like the infant formula and pediatric and adult nutritionals its Abbott Nutrition makes and markets, Abbott’s OTC diagnostics will be products that consumers stock in their homes rather than buy when needed, Ford said.

“I think this is something that people are going to want to buy and have in their homes and stock-up in their homes. Think of it as maybe your new element in your medicine cabinet. But we've been seeing this shift happen towards the end of last year and definitely into this quarter here,” he said.

Abbott, he added, could have an advantage over other firms, almost all smaller companies focused entirely on medical diagnostic technologies, in the emerging market for OTC tests.

“Specifically in the US, we've got a great position as a lot of this OTC is going to require understanding of the retail and the retail environment, the retail channel. And those are capabilities that … through our nutrition business, through our diabetes business, we know how to operate and operate pretty well in there,” the CEO said.

The Abbott Park, IL-based firm on 19 April announced it was shipping its BinaxNOW COVID-19 Ag Self Test to US retailers. ()

The BinaxNOW kit initially will be available in stores and online from CVS, Walgreens and Walmart with broader nationwide availability planned in the next two weeks. It’s sold in 2-count packs at a suggested retail price $23.99.




abbott labs ceo robert ford: "through our nutrition business, through our diabetes business, we know how to operate and operate pretty well in" retail.Source: Abbott Laboratories

“We're very excited about that. So we see this as a significant opportunity. It's easy and it's affordable,” Ford said during the earnings briefing.

The Food and Drug Administration granted emergency use authorization for an OTC BinaxNOW in December before expanding the authorization to include consumers without symptoms in March. The agency at that time made the same changes in its EUAs for OTC tests made by Quidel Corporation, QuickVue At-Home, and Becton, Dickinson and Company, BD Veritor System for Rapid Detection. ()

Abbott isn’t alone anticipating consumer demand for home-use diagnostics are spurred by COVID-19 and will continue following the pandemic. However, all the COVID-19 tests sold OTC in the US are available under EUAs, which the FDA will pull after the public health emergency is lifted.

Gaining the EUAs wasn’t simple – the first at-home test for SARS-CoV-2, the virus that causes COVID-19, allowed for OTC distribution was cleared in the US nearly a year after national health emergency was declared due to the pandemic. Regulatory approval through conventional channels for direct-to-consumer sales of sample-collection kits will even more difficult.

The FDA’s first EUA for an OTC home-use COVID-19 test was in December for LabCorp's Pixel 19 test sample collection kit. The Pixel kit allows adults to self-collect a nasal swab sample at home and send it to LabCorp to be tested with LabCorp’s a real-time reverse transcription polymerase chain reaction test. ()

In February, the department of Defense and of Health and Human Services awarded Ellume Ltd. a contract to manufacture tests to be made available to US consumers. Until a facility is built for Ellume USA LLC based in Valencia, CA, the US is receiving half the OTC at-home COVID-19 antigen tests, available under an EUA the FDA granted to December, it manufactures at its headquarters in East Brisbane, Australia. ()

In March, the agency granted its first EUA for an OTC at-home molecular diagnostic test for Cue Health Inc.’s at-home molecular nucleic acid amplification test capable of detecting genetic material from the SARS-CoV-2 virus. The FDA invested $481m in the San Diego firm in 2020 and said it expects Cue Health to produce more than 100,000 tests per day by this summer. ()

Another OTC COVID-19 test with an EUA from the FDA, Quidel Corp.’s QuickVue At-Home, is being used in a program the National Institutes of Health is conducting with the Centers for Disease Control to determine whether frequent self-administered testing helps reduce community transmission. ()

In same-day research notes, analysts agreed with Abbott’s expectation of a short-term boost for OTC diagnostics sales on consumers’ COVID-19 concerns. They’re not sold yet on a longer-term boost.

“Despite the affordable $24 retail price per test, we’re still skeptical that consumers will use the tests on a widespread and consistent basis if they must pay out-of-pocket. However, if we see employers, schools, or organized sports for kids putting forth testing parameters requiring testing for participation in gatherings, then we would revisit our assumptions for adoption,” said Morningstar’s Debbie Wang.

Jefferies analysts said they expect Abbott’s “launch of BinaxNOW OTC will extend the pandemic testing tailwind into 2022 and beyond.”

Abbott reported sales for the January-March period were up 35.3%, or 32.9% organically, to $10.5bn. Its global COVID-19 testing-related sales were $2.2bn in the quarter, on $1.8bn combined sales from its BinaxNOW, Panbio and ID NOW testing platforms.

Its overall diagnostics product sales jumped in all its markets. Reported global sales were up 119.8% to $4.01bn on 10r.4% growth in the US to $1.6bn and a 131.9% increase internationally to $2.4bn, Abbott stated.

The firm’s reported total nutritional business sales for the quarter were up 6.9% to $2.04bn as adult product sales grew a reported 18.9%m to $970m but pediatric product sales slumped 2.1% reported, to $1.07bn.

The results initially prompted a dip in Abbott's share price in the New York Stock Exchange, closing at $123.32 the day its results were released after a close of $125.02 the previous day. However, the shares trade generally upward the remainder of the week, reaching $124.70 on 22 April and closing at $123.32 the next day to end the week.   

By Malcolm Spicer