NEW YORK (AP) — Shares of OraSure Technologies Inc. jumped to a six-year high Wednesday after a Food and Drug Administration panel said the company's at-home HIV test should be approved.
THE SPARK: On Tuesday an FDA panel voted unanimously in favor of the OraQuick In-Home HIV Test. The product is designed to return test results in 20 minutes based on a mouth swab. OraSure wants to sell it over the counter. The test appears to be less accurate than tests administered by professionals, but it could help address the relatively large number of people who have HIV and do not know it.
The federal government estimates that about 1.2 million people in the U.S. have HIV, and 20 percent, or 240,000, do not know it.
THE BIG PICTURE: The Bethlehem, Pa., company makes tests for hepatitis C, influenza, alcohol, and drugs of abuse like marijuana, cocaine, and opiates. OraSure makes other HIV tests but OraQuick is the first test designed to be used by a patient at home.
THE ANALYSIS: JMP Securities analyst Charles Duncan said it is almost certain that the FDA will approve the test and OraSure will begin selling it in the third quarter. He said OraSure will hold talks with the FDA to deal with the agency's concerns about incorrect test results.
Duncan maintained a "Market Outperform" rating on OraSure stock with a price target of $15 per share.
SHARE ACTION: Shares of OraSure advanced $1.26, or 13.8 percent, to $10.366 in afternoon trading. Earlier the stock climbed as high as $12.28, its greatest price since late 2005.