What's Going With COVID-19 Test Maker QuidelOrtho Stock On Tuesday?

On Tuesday, QuidelOrtho Corporation QDEL received FDA 510(k) clearance for its QuickVue COVID-19 test. 

This clearance allows the test to be used accurately and conveniently in home and medical facility settings with CLIA certificates of waiver. 

The QuickVue COVID-19 test, designed for symptomatic individuals within six days of symptom onset, is cleared for use in individuals aged 14 or older when self-testing and in those aged two and older when administered by an adult. 

QuidelOrtho secured FDA 510(k) clearance in December 2023 for its Savanna PCR platform and Savanna HSV 1+2/VZV PCR assay. 

This clearance authorizes the marketing and sale of the Savanna multiplex molecular platform and the Savanna HSV 1+2/VZV assay to U.S. laboratories conducting moderate or high-complexity diagnostic testing.

However, the shares are plunging as the company said that upon reviewing the performance of the Savanna RVP4+ (Respiratory Viral Panel-4) assay against the clinical market’s expectations, a decision was made to withdraw the current FDA 510(k) submission for the Savanna RVP4+ assay. 

The Savanna RVP4 Assay is intended for use with the Savanna instrument for the simultaneous qualitative detection and differentiation of influenza A, influenza B, respiratory syncytial virus, and SARS-CoV-2 (COVID-19).

Data generated over a 9-month for the four viruses targeted by the assay initially showed great promise, leading to the FDA submission in July 2023. However, the final dataset, submitted in February 2024, did not meet expectations. 

In addition, during the pendency of the submission, the company has continued to develop the next-generation RVP4+ assay. The company anticipates the new multiplex assay to be commercially available during the 2024/2025 respiratory season.

The company expects to begin clinical trials for its sexually transmitted infection panel later in the second quarter.

RBC Capital Markets writes that despite the news, there has been no change in the price target of $81 and the Outperform rating.

RBC said it reached out to management, and they said that they have been working in parallel to address issues seen in the prior panel. 

The company also mentioned no updates to Savanna’s 2024 guidance of $30 million – $50 million, with dilutive EBITDA margins.

Price Action: QDEL shares are down 10.6% at $42 on the last check Tuesday.

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