OSUR Approval Green-Light's CEMI's OTC Program?
Brian Marckx, CFA
CHEMBIO DIAGNOS (CEMI): Free Stock Analysis
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OraSure's Rapid HIV FDA Approved For OTC Market
On Tuesday (7/3) the FDA approved
OraQuick over-the-counter rapid HIV test. The test, which
uses an oral swab (saliva) as the sample and is basically identical
to the test sold to the clinical market, is the first HIV test to
be approved for home use. While the approval was not a total
surprise given that in May an FDA advisory panel (Blood Products
Advisory Committee) voted unanimously in favor of approving the
test, there were some lingering doubts given concerns about the
risk of false positives from the test. OraSure's shares
jumped on the news on Tuesday and are up over 15% from the closing
price on Monday.
has noted in the recent past that they might pursue FDA approval of
their Sure Check (lateral flow, using blood sample) rapid HIV 1/2
test for the OTC market. In September 2011 the FDA provided
guidance that Chembio will need to perform additional studies in
order to submit for an Investigational Device Exemption
(IDE). FDA clarified the regulatory pathway and Chembio has
since completed the instructional manual for home-use
testing. But before spending any substantial time and
financial resources on an OTC program, including running clinical
trials, Chembio was waiting for the FDA's decision on OSUR's OTC
test. Tuesday's news now opens the door for Chembio to pursue
OTC approval of its Sure Check rapid HIV test, which is already FDA
approved for the clinical market. As we've noted previously,
as eventual FDA approval of a Sure Check OTC test is still
uncertain (although chances are likely now more favorable with FDA
approval of OraQuick) and not a near-term event, we do not yet
include any contribution from it in our model.
We cover Chembio with an Outperform rating and $10.40 price target.