Shares of Quidel (NASDAQ:QDEL), a diagnostics company that specializes in rapid testing for a variety of diseases, were on the rise following good news from the FDA. The company's point-of-care SARS-CoV-2 test received an emergency use authorization (EUA) on Saturday, and as a result, the stock was up 31.1% as of 3:18 p.m. EDT Monday.
The Food and Drug Administration has handed out a lot of EUAs for new coronavirus tests recently, but Quidel's stands out as the only antigen-based test. The Sofia 2 SARS-CoV-2 Antigen FIA looks for specific pieces of the novel coronavirus instead of the antibodies our immune systems generate in response to those antigens.
While a positive antibody test tells healthcare providers that someone has had a COVID-19 infection, that doesn't necessarily mean they're still infected. Diagnostic tests that look for genetic material specific to viruses are generally less likely to deliver false positives than antibody tests, but those molecular diagnostics tend to cost more and take much longer to run. Quidel's antigen test could become a huge revenue stream for the company because it offers healthcare systems an inexpensive solution that's accurate and fast.
Quidel's bottom line had been relatively stagnant, but things are looking up thanks to the increasing popularity of its Sofia 2 point-of-care testing system. During the first quarter, its adjusted earnings rose 36% year over year to $53 million.
An unusually heavy influenza season followed by explosive demand for coronavirus testing will probably make 2020 a banner growth year for the diagnostics company.