Ellume CEO: Military and essential services prioritized for rapid at-home COVID-19 test
Ellume Health’s rapid COVID-19 antigen test received new support from the federal government Monday with a $231.8 million deal for 8.5 million tests this year, but the company has been forced to delay its launch into retail stores as a result of the deal and supply chain pressures.
The highly anticipated non-prescription test, which would be sold for around $30 in retail stores, was expected to launch this month.
“The first batches of those are on their way to the U.S.,” said CEO Sean Parsons in an interview with Yahoo Finance. “We’ve been forced to prioritize around military and essential services,” Parsons said.
That’s in part due to recent funding sources, shared between the Health and Human Services Department and Department of Defense.
The company is also facing supply chain strains that have pushed back the launch date to March. But discussions with major retailers — which Parsons previously noted included the likes of CVS (CVS) and Walgreens (WBA) — is ongoing, with announcements due in coming weeks.
In addition, global demand for various components has affected the supply chain, which is “groaning” from the pressure. That includes demand for nasal swabs, which continue to be a hot item for all testing companies.
The new funding to build domestic manufacturing capacity for the Brisbane, Australia-based company will also help provide tests for major events and large employers, which have already expressed interest, Parsons said.
The company was the first to receive emergency use authorization (EUA) for an at-home COVID-19 test from the U.S. Food and Drug Administration (FDA) in December. The highly sensitive and accurate test, which first received $30 million in funding from the National Institutes of Health (NIH) in October, can be used on anyone 2 years and older. The nasal swab test is a single-use product that involves linking to a smartphone app to get the results.
The company previously targeted 100,000 tests per day in January and 20 million tests to the U.S. by mid-year. The current shipment of tests was manufactured in Australia, where the company has been ramping up production — adding 500 jobs and producing upwards of 200,000 tests per day.
The goal is to be able to produce about 25 million tests per month by the end of the year, Parsons said. Parsons anticipates announcing soon the location of the U.S. plant, which would be in an existing facility that would be renovated and the hiring more than 1,200 highly-skilled Americans.
In the U.S., the company has partnered with Qiagen — recently acquired by Thermo Fisher (TMO)—for a rapid antibody test the two developed. Ellume has other partners as well, including Toolbox Medical Innovation for clinical research and Nordic Semiconductor, the key to the at-home test which transmits test results to a smartphone via bluetooth.
The investment in a new plant amid the ongoing pandemic is a long-term strategy, Parsons said.
It will serve a purpose in responding to what experts anticipate will be regular pandemics in coming years. Parsons noted the plant could be used for future flu pandemics or future strains of the coronavirus.
More from Anjalee:
What you need to know about at-home, over-the-counter COVID-19 tests
Biden COVID-19 adviser: Vaccine news is great, but we still have a ways to go
Read the latest financial and business news from Yahoo Finance.
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, SmartNews, LinkedIn, YouTube.
Follow Anjalee on Twitter @AnjKhem.