After announcing it has launched a COVID-19 screening program to help employers make return-to-work decisions for employees, OPKO Health (NASDAQ:OPK) saw its shares close the day up more than 10% on Thursday.
OPKO Health's BioReference Labs has been assisting healthcare providers with COVID-19 testing services since mid-March. On Monday, management expanded its COVID-19 product platform with the launch of an antibody test that can determine if someone has been exposed to the virus, and on Wednesday, the healthcare company unveiled services designed to inform business decisions relating to employees.
Specifically, its BioReference employer solution will allow employees to register for antibody testing online. It also provides for on-site testing and processing, with online access to testing results. BioReference is also offering pop-up testing sites that businesses can use, with the first of these locations opening on Friday in Livingston, New Jersey.
The move positions the company to capture a growing share of what is becoming a significant opportunity: increasing demand for testing services. Since March, BioReference Labs has performed hundreds of thousands of tests, and its capacity has reached 35,000 tests daily.
OPKO's revenue was $211.5 million in the first quarter, which was down 4.9% year over year because early testing capacity wasn't able to offset declining lab-services demand from doctor-office visits caused by shelter-in-place orders. It's unclear if COVID-19 testing, including antibody testing, will be able to overcome the headwind this quarter, but management has said it will soon be able to process 400,000 antibody tests per day.
An increase in COVID-19 business is particularly important to OPKO Health, because it posted losses of $59.1 million last quarter, and it's arguably financially hamstrung given the company only had $35 million in cash on its balance sheet exiting March. The company does have wiggle room courtesy of a $100 million credit facility from its founder, Phillip Frost, but it could certainly benefit if COVID-19 testing demand can keep it from tapping that financing.