Abbott soars 10% after its 15-minute COVID-19 test wins FDA approval

People stand in line at a clinic in Long Beach, California offering quick coronavirus testing for a fee, on Monday, June 29, 2020. Brittany Murray/MediaNews Group/Long Beach Press-Telegram via Getty Images
  • Abbott surged 10% on Thursday after the FDA granted emergency authorization for its 15-minute COVID-19 test.
  • Aside from the quick testing results, the new test is also significant because it will cost only $US5.
  • The test, BinaxNOW, can be used at “massive scale” and does not require lab equipment to deliver results, according to Abbott.
  • Abbott plans to ship up to 50 million tests per month by October.
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Abbott is set to shake up the COVID-19 testing landscape after receiving emergency authorization for its new COVID-19 test from the FDA on Wednesday.

Abbott’s test, BinaxNOW, is a COVID-19 diagnostic test that can deliver results in 15 minutes without the use of lab equipment. The test will cost just $US5, according to Abbott.

Shares soared as much as 10% to $US113.72 on the news in Thursday trades.

The new COVID test will be accompanied by a free smartphone app that will display a user’s test results, which can then be displayed when asked at social gathering places like schools and workplaces.

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Abbott anticipates shipping tens of millions of BinaxNOW tests in September, and plans to ramp up monthly production of the tests to 50 million by October.

Jim Cramer said in a tweet on Wednesday that Abbott’s new COVID test is a “game changer” that could help the economy reopen quicker as rapid testing for the disease becomes widely available.

According to Abbott, the BinaxNOW test delivered sensitivity of 97.1% and accuracy of 98.5% in a clinical study.

Abbott isn’t the only company that received FDA emergency authorization for a potential game-changing COVID-19 test this week.

On Tuesday, small-cap diagnostics company Fluidigm received FDA approval for its saliva-based COVID-19 test, allowing patients to avoid the more invasive nasal swab test that has been used since the outbreak began earlier this year.

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