Trump to announce $750 million deal with Abbott for at least 150 million rapid coronavirus tests
- President Donald Trump plans to announce Thursday the purchase of 150 million rapid Covid-19 tests as part of a $750 million agreement with Abbott Laboratories, a White House official confirmed.
- Trump plans to use his speech at the Republican National Convention to announce the deal, the official said.
Trump plans to use his speech at the Republican National Convention to announce the deal, the official said.
"This is a major development that will help our country to remain open, get Americans back to work, and kids back to school," White House communications director Alyssa Farah said in a statement to CNBC. "The Trump Administration is proud to partner with Abbott labs to make this purchase possible to help the American people."
Word of the plans was first reported by Politico.
The Food and Drug Administration granted emergency use approval late Wednesday to Abbott for its new coronavirus antigen test, which it said is the first Covid-19 test that costs about $5 and delivers results in minutes on a testing card without lab equipment, similar to a pregnancy test.
Shares of Abbott finished the day up nearly 8%, closing at an all-time high of $111.29. The American medical device company now boasts a market cap of about $197 billion.
Abbott said in a statement after it received FDA authorization that it will "ship tens of millions of tests in September, ramping production to 50 million tests a month in October."
White House Press Secretary Kayleigh McEnany released the following statement on the administration's purchase of the rapid tests: "Through Operation Warp Speed and in partnership with Abbott Laboratories, final production will be scaled to an unprecedented 50 million tests monthly."
The Department of Health and Human Services said in a press release the rapid tests will be "potentially deployed to schools and to assist with serving other special needs populations."
"By strategically distributing 150 million of these tests to where they're needed most, we can track the virus like never before and protect millions of Americans at risk in especially vulnerable situations," HHS Secretary Alex Azar said.
Representatives of Abbott Labs did not immediately return CNBC's request for further comment.
The test, called BinaxNOW, is an antigen test, which are somewhat more likely to incorrectly diagnose someone as negative when they are in fact infected than by using molecular tests. While molecular tests are the most accurate on the market, they depend on technical lab equipment, trained personnel and a strained supply chain, which makes scaling up molecular tests to a massive level difficult.
"Due to the potential for decreased sensitivity compared to molecular assays, negative results from an antigen test may need to be confirmed with a molecular test prior to making treatment decisions," the FDA said in its authorization of the BinaxNOW test. "Negative results from an antigen test should be considered in the context of clinical observations, patient history and epidemiological information."
The test is only authorized for use in patients suspected to have Covid-19 and "within seven days of symptom onset," the FDA says, meaning it is not authorized to test asymptomatic or presymptomatic people.
"This test could be used at point-of-care settings, like a doctor's office, emergency room or some schools," the FDA said. "Given the simple nature of this test, it is likely that these tests could be made broadly available."
The U.S. coronavirus testing program has depended mostly on molecular tests processed in certified clinical labs. But epidemiologists and diagnostic testing specialists say these labs and the equipment they have were not designed to operate at the scale and speed demanded by the pandemic. As a result, the country has struggled, especially at the height of the outbreak earlier this summer, to test everyone who wants to be tested and to return results in a timely manner.
The nation's biggest testing laboratory companies previously acknowledged they were unable to return results in under a week, in some cases. Epidemiologists have said that long turnaround times for the tests render them essentially useless because it takes so long to get results that people can't self-isolate once they find out they have the virus.
"Rapid antigen tests perform well while eliminating the waiting game," Abbott President and CEO Robert Ford said in an op-ed published earlier Thursday by CNBC. "Rapid tests deliver actionable results quickly so that infected patients can immediately begin self-quarantine. This test, along with others like it, is risk reduction on a societal scale."
Testing turnaround time has improved since the peak of the U.S. outbreak. Assistant Secretary for Health Adm. Brett Giroir, who leads the Trump administration's testing effort, said Wednesday that "the turnaround time issue is essentially solved," though he noted there are "outliers."
But in letters sent to executives at five of the nation's biggest laboratories, Sens. Elizabeth Warren and Tina Smith expressed concern that as flu season settles in and the same labs work double-time to process tests for both flu and Covid-19, it "may again strain labs' ability to perform and deliver test results in a timely manner."
Greater variety in the types of tests available and the supplies they depend on could help mitigate the complications of testing for both Covid-19 and the flu, Dr. Michael Mina, a professor of epidemiology at Harvard's School of Public Health, said in an interview earlier this week.
This 39-year-old makes $160K/month in passive income—a look at his typical day: 'I work 5 hours a week'
A Harvard nutritionist shares the No. 1 vitamin that keeps her brain 'young and healthy'—and what to eat
Hong Kong cuts hotel quarantine for travelers to 3 days, plus 4 days of home medical surveillance
These are the best and worst places to live in the world—and none are in the U.S.
BlackRock: The era of steady growth has ended, but here's how investors can prepare for it