Shares of Hauppauge-based Chembio Diagnostics plummeted Tuesday after the U.S. Food and Drug Administration revoked an emergency authorization to market its COVID-19 antibody test, citing higher than expected inaccurate results.
Shares of Chembio tumbled on June 17 more than 60 percent or slightly more than $6 by late morning to just under $4, following the revocation. Chembio’s antibody test was one of the first that the FDA authorized during the COVID-19 public health emergency under special orders designed to clear the path to market for products that might be helpful in battling the pandemic.
“New information from three evaluations performed since authorization of the device demonstrates its performance may be both inconsistent and lower than that described in your original submission,” Denise Hinton, chief scientist at the FDA, wrote Monday in letter to Chembio, informing the company of the decision to revoke approval.
The FDA said Chembio had provided additional data on April 29 and May 15 and taken steps designed to improve performance, but the agency was not satisfied the test was able to meet standards of accuracy needed to sustain use.
Chembio did not immediately respond to a request for comment on the decision.
“Based on the information that Chembio submitted to the FDA at that time, the agency concluded that the test met the statute’s ‘may be effective’ standard for emergency use authorization,” the FDA said in a statement issued Tuesday regarding initial approval.
The FDA in its decision to revoke the authorization cited “data submitted by Chembio as well as an independent evaluation of the Chembio test at the National Institutes of Health’s National Cancer Institute” that the agency said “showed that this test generates a higher than expected rate of false results and higher than that reflected in the authorized labeling for the device.”
The agency added that “under the current circumstances of the public health emergency, it is not reasonable to believe that the test may be effective in detecting antibodies against SARS-CoV-2.”
In its decision, the FDA further said that “the risk to public health from the false test results makes emergency use authorization revocation appropriate to protect the public health or safety.”
Chembio recently issued about 280,000 shares of stock that it said at the time were expected to generate $30.8 million.
And it reached a multi-year, non‑exclusive agreement with Thermo Fisher Scientific to distribute its DPP COVID-19 System in the United States.
The company also said it had reached a $4 million deal to provide tests for use in Brazil.
Facing a healthcare crisis, the FDA earlier provided a much easier path to use for tests related to COVID-19 than under ordinary circumstances.
“Since the beginning of the COVID-19 public health emergency, the FDA has balanced the urgent need for access to diagnostic and antibody tests with providing a level of oversight that helps to ensure accurate tests are being deployed,” Dr. Jeff Shuren, director of FDA’s Center for Devices and Radiological Health, said in a statement. “By continuing to monitor authorized tests and emerging scientific evidence, we are able to make changes when appropriate, including taking action when a test’s benefits no longer outweigh its risks.”
For more coronavirus coverage, visit longislandpress.com/coronavirus