One medical testing company was led by a convicted felon, another was accused of delays and unreliable results
Like many states, Florida has worked hard to quickly ramp up diagnostic testing for SARS-CoV-2, the coronavirus that causes the COVID-19 illness. For the most part this has been a good thing. However, local media in that state reported problems with two no-bid contracts for clinical laboratory testing, including one with a Dallas-based company whose founder pleaded guilty last year to two felonies involving insurance fraud.
In a press conference announcing the two deals, Florida Governor Ron DeSantis said, “We have two contracts in place with two new labs that will increase our lab capacity by 18,000 samples per day.” He added that he expected a 24- to 48-hour turnaround.
“That’s a lot better than we’ve been getting from Quest and LabCorp,” he said. “These labs will be primarily where we send our samples that we collect in the long-term-care and assisted-living facilities and at the community-based walk-up sites.”
The announcement followed DeSantis’ March 9 emergency decree, which allowed state agencies to award contracts to companies without undergoing formal bidding processes, reported Florida Bulldog, an independent non-profit news site.
In his announcement, DeSantis did not identify the companies that had received the lab test contracts. However, Florida Bulldog reported that those companies were:
Indur Services, a Dallas-based health-coaching company, and
Southwest Regional PCR, a CAP-accredited lab in Lubbock, Texas, that does business as MicroGenDX Laboratory (MicroGen Diagnostics, LLC).
The Indur contract—initially valued at $11.3 million—included $10.2 million for 140,000 COVID-19 RT-qPCR test kits, plus additional payment for supplies, Florida Bulldog reported based on information from the state contract database. Later, the contract was reduced to $2.2 million solely for supplies.
The MicroGenDX contract—valued at $11 million—called for 8,000 tests per day for 14 days at a cost of $99 per test, Florida Bulldog reported. That contract was later cancelled due to concerns about reliability and processing speed.
Indur’s Legal Troubles
Indur is a self-described “health and wellness lifestyle and products company” founded in 2017 by Brandt Beal, according to Business Insider. In 2019, Beal pleaded guilty to two felonies involving insurance fraud in Texas and was given 10 years’ probation in each case, Florida Bulldog reported. He also was required to pay restitution. He pleaded guilty to a separate charge of felony theft in 2017 and was sentenced to nine years’ probation.
In an interview with Florida Bulldog, Beal claimed that “the man who pleaded guilty to those charges is actually his cousin with the same name.” However, Beal “would not provide requested contact information for his cousin,” the Florida Bulldog reported, which posted photos demonstrating that the Indur founder and the person who pleaded guilty to the felonies were the same individual.
The amended contract, valued at $2.2 million, called for Indur to deliver swabs and vials. “To date, everything that’s been ordered they’ve delivered on,” said Jared Moskowitz, Director of the Florida Division of Emergency Management department.
Testing Delays Snag MicroGen Diagnostics
The state cancelled its contract with MicroGenDX on May 15, Florida Bulldog reported.
“As with any lab, we do our due diligence to ensure the company will be able to provide reliable services before sending any samples,” said Jason Mahon, Communications Director at the Florida Division of Emergency Management. “Upon further interaction with this vendor, the Division determined that the state could not be 100% confident in the results that would come from this vendor, or with the processing speed, which is critical for COVID-19 testing.”
This came as AdventHealth, a non-profit health system based in Altamonte Springs, Fla., was having its own difficulties with MicroGenDX.
On May 16, AdventHealth announced that it had terminated a COVID-19 testing contract with an unnamed third-party lab, claiming that the provider was “unable to fulfill its obligation.” Multiple media outlets later revealed MicroGenDX as the third-party lab, and USA Today reported that the FDA had launched an investigation.
“This issue impacts more than 25,000 people throughout Central Florida,” stated an AdventHealth press release. “This situation has created unacceptable delays and we do not have confidence in the reliability of the tests.” AdventHealth said it would contact affected individuals about the need for retesting.
However, MicroGenDX CEO Rick Martin refuted the health system’s claims. “You can go after me because I didn’t meet your capacity and I couldn’t deliver on your drive-through testing because of things that I couldn’t control, but don’t attack the reliability of my test,” he told the Orlando Sentinel.
According to MicroGenDX, the company received an emergency use authorization (EUA) from the FDA on April 23 for an internally-developed RT-PCR test that can be performed on nasal swabs or sputum samples, noted a press release. The tests are run in the company’s lab facility in Lubbock, Texas.
One factor in the dispute was the handling of patient samples, USA Today reported. Martin told reporters that representatives from AdventHealth had visited the lab and observed samples that were stored at room temperature. “[Martin] maintains the samples were still valid and that the delays were due to AdventHealth not providing proper patient data and the lab running out of plastic parts used in its equipment,” noted USA Today.
Mahon told Florida Bulldog that the state did not send samples to MicroGenDX for processing. And the Florida Bulldog reported that Martin said his lab was so “hammered with huge volumes of samples” that he would have turned down any requests, adding that Martin “stood by the reliability and accuracy of his firm’s testing and said he looks forward to a day of vindication after federal inspectors conduct any inquiries.”
Collectively, these news stories scratch the surface of a bigger situation involving COVID-19 laboratory testing. The fact that Congress authorized billions of dollars to fund COVID-19 testing was noticed by some individuals who saw the funding as an opportunity to “make a quick buck” if they could get contracts to provide COVID-19 testing—whether they owned a CLIA-certified complex laboratory or not.
Thus, it’s no surprise that more companies are bidding on COVID-19 testing contracts. What remains unknown is how many of those companies are actively soliciting COVID-19 testing contracts throughout the United States.
Given this situation, and the facts recounted above, it is reasonable to ask an obvious question: Why did Florida state officials not do a more rigorous check into the credentials of the clinical laboratory entities they were preparing to award no-competitive-bid contracts to for COVID-19 testing?
Australian government heralded April purchase of 10 million clinical laboratory diagnostics tests from BGI, but most of the nation’s states and territories say kits are unneeded or unable to be used by their health departments
While the United States and other nations attempt to bring the COVID-19 outbreak under control, many countries have turned to China to offset shortages of clinical laboratory SARS-CoV-2 test kits needed to diagnose the coronavirus. This did not work out well for the United Kingdom and Spain, each which purchased large volumes of COVID-19 test kits from Chinese companies in April.
Now comes news that Australia spent roughly $130 million US ($200 million AUD) in late April for COVID-19 RT-PCR tests from BGI Genomics. However, those kits are mainly going unused as Australian state governments say they are unneeded or incompatible with existing testing equipment.
This is the latest example of the problems plaguing governments worldwide as they scramble to boost SARS-CoV-2 testing capacity during the evolving pandemic.
The new problem is that COVID-19 testing capacity has increased so much it now exceeds demand for testing. This is true for portions of Australia and in some states in the US.
Demand for Testing in Australia Far Lower than Expected
With a population of roughly 25 million, Australia has a smaller population than Texas, which in 2020 stood at about 28 million. According to the Johns Hopkins COVID-19 Dashboard, Australia had 7,139 confirmed cases of COVID-19 as of May 27 and 103 deaths.
Australian billionaire Andrew “Twiggy” Forrest, former CEO of Fortescue Metals Group, orchestrated the purchase of 10 million COVID-19 RT-PCR testing kits for Australia from BGI. He did so through his philanthropic organization, the Minderoo Foundation, with the understanding that the purchase cost would be refunded by the Australian government.
On April 28, the Australian government heralded Forrest’s purchase as a commercial coup, because it occurred in the midst of sparring between the two countries over China’s handling of the coronavirus outbreak and fierce international competition for COVID-19 diagnostic testing kits.
Forrest credited his personal relationship with BGI for his ability to secure the kits for Australia. “Chairman Wang [Jian] and BGI kept to their word and resisted that very clear temptation of a businessman to make a much bigger profit and maintain the integrity of my relationship, and I’m very grateful for that,” Forrest told ABC News.
However, less than a month later, The Guardian Australia reported the taxpayer-funded coronavirus testing kits Forrest brought to Australia were not being used. Instead, the test kits have been added to the country’s strategic reserve. Three of five Australian states and both territories—Queensland, New South Wales, Western Australia, the Northern Territory, and the Australian Capital Territory—all told the newspaper they were not using the BGI tests. Only Victoria reported it was using the BGI tests.
“PathWest, Western Australia’s leading pathology laboratory, is not using the BGI-manufactured COVID-19 PCR testing kits,” the Western Australia Department of Health told The Guardian. “PathWest has capacity and sufficient reagent to provide testing throughout the state without the need to use these tests.”
“Queensland Health does not use the BGI COVID-19 test or its operating platform,” a spokeswoman told The Guardian. “Queensland already has ample testing capacity, illustrated by the world leading figures of 137,000 COVID-19 tests since January.”
According to ABC News, Minderoo also purchased 11 testing machines, which were installed around the country. Six Chinese experts flew to Australia to help oversee the testing machines’ installation.
Testing Capacity Also Exceeds Demand in US
Increased COVID-19 testing capacity has been considered a cornerstone to fully lifting stay-at-home orders and reopening businesses, schools, and entertainment venues. But Australia is not alone in ramping up testing capacity only to have public demand not keep pace. The Washington Post reported in mid-May that in at least a dozen states COVID-19 testing capacity exceeded the number of patients lining up for testing.
Utah Department of Health spokesperson Tom Hudachko is among those questioning why people aren’t getting tested in his state, which has a 9,000-test capacity, but was conducting only 3,500 tests a day.
“Well, that’s the million-dollar question,” Hudachko told the Washington Post. “It could be simply that people don’t want to be tested. It could be that people feel like they don’t need to be tested. It could be that people are so mildly symptomatic that they’re just not concerned that having a positive lab result would actually change their course in any meaningful way.”
Meanwhile, Australia’s federal government has the interesting problem of having purchased $130 million (US) of COVID-19 test kits from a Chinese company—test kits that most of the nation’s states and territories have yet to use. Could this be a sign that many clinical laboratory scientists in Australia have their doubts about the accuracy and reliability of these Chinese-manufactured COVID-19 tests?
In the absence of a “gold standard,” researchers are finding a high frequency of false negatives among SARS-CoV-2 RT-PCR tests
Serology tests designed to detect antibodies to the SARS-CoV-2 coronavirus that causes the COVID-19 illness have been dogged by well-publicized questions about accuracy. However, researchers also are raising concerns about the accuracy of molecular diagnostics which claim to detect the actual presence of the coronavirus itself.
“Diagnostic tests, typically involving a nasopharyngeal swab, can be inaccurate in two ways,” said Steven Woloshin, MD, MS, in a news release announcing a new report that “examines challenges and implications of false-negative COVID-19 tests.” Woloshin is an internist, a professor at Dartmouth Institute, and co-director of the Geisel School of Medicine at Dartmouth.
“A false-positive result mistakenly labels a person infected, with consequences including unnecessary quarantine and contact tracing,” he stated in the news release. “False-negative results are far more consequential, because infected persons who might be asymptomatic may not be isolated and can infect others.”
Woloshin led a team of Dartmouth researchers who analyzed two studies from Wuhan, China, and a literature review by researchers in Europe and South America that indicated diagnostic tests for COVID-19 are frequently generating false negatives. The team published their results in the June 5 New England Journal of Medicine (NEJM).
For example, one research team in Wuhan collected samples from 213 hospitalized COVID-19 patients and found that an approved RT-PCR test produced false negatives in 11% of sputum samples, 27% of nasal samples, and 40% of throat samples. Their research was published on the medRxiv preprint server and has not been peer-reviewed.
The literature review Woloshin’s team studied was also published on medRxiv, titled, “False-Negative Results of Initial Rt-PCR Assays for COVID-19: A Systematic Review.” It indicated that the rate of false negatives could be as high as 29%. The authors of the review looked at five studies that had enrolled a total of 957 patients. “The collected evidence has several limitations, including risk of bias issues, high heterogeneity, and concerns about its applicability,” they wrote. “Nonetheless, our findings reinforce the need for repeated testing in patients with suspicion of SARS-Cov-2 infection.”
Another literature review, published in the Annals of Internal Medicine, titled, “Variation in False-Negative Rate of Reverse Transcriptase Polymerase Chain Reaction–Based SARS-CoV-2 Tests by Time Since Exposure,” estimated the probability of false negatives in RT-PCR tests at varying intervals from the time of exposure and symptom onset. For example, the authors found that the median false-negative rate was 38% if a test was performed on the day of symptom onset, versus 20% three days after onset. Their analysis was based on seven studies, five of which were peer-reviewed, with a total of 1330 test samples.
Doctors also are seeing anecdotal evidence of false negatives. For example, clinicians at UC San Diego Health medical center treated a patient with obvious symptoms of COVID-19, but two tests performed on throat samples were negative. However, a third test, using a sample from a bronchial wash, identified the virus, reported Medscape.
Sensitivity and Specificity of COVID-19 Clinical Laboratory Tests
The key measures of test accuracy are sensitivity, which refers to the ability to detect the presence of the virus, and specificity, the ability to determine that the targeted pathogen is not present. “So, a sensitive test is less likely to provide a false-negative result and a specific test is less likely to provide a false-positive result,” wrote Kirsten Meek, PhD, medical writer and editor, in an article for ARUP Laboratories.
“Analytic” sensitivity and specificity “represent the accuracy of a test under ideal conditions in which specimens have been collected from patients with either high viral loads or a complete absence of exposure,” she wrote. However, “sensitivity and specificity under real-world conditions, in which patients are more variable and specimen collection may not be ideal, can often be lower than reported numbers.”
In a statement defending its ID Now molecular point-of-care test, which came under scrutiny during a study of COVID-19 molecular tests by NYU Langone Health, Northwell Health, and Cleveland Clinic, according to MedTech Dive, Abbott Laboratories blamed improper sample collection and handling for highly-publicized false negatives produced by its rapid test. An FDA issued alert about the test on May 14 noted that Abbott had agreed to conduct post-market studies to identify the cause of the false negatives and suggest remedial actions.
Issues with Emergency Use Authorizations
In their NEJM analysis, Woloshin et al point to issues with the FDA’s process for issuing Emergency Use Authorizations (EUAs). For example, they noted variations in how manufacturers are conducting clinical evaluations to determine test performance. “The FDA prefers the use of ‘natural clinical specimens’ but has permitted the use of ‘contrived specimens’ produced by adding viral RNA or inactivated virus to leftover clinical material,” they wrote.
When evaluating clinical performance, manufacturers ordinarily conduct an index test of patients and compare the results with reference-standard test, according to the Dartmouth researchers. For people showing symptoms, the reference standard should be a clinical diagnosis performed by an independent adjudication panel. However, they wrote, “it is unclear whether the sensitivity of any FDA-authorized commercial test has been assessed in this way.” Additionally, a reference standard for determining sensitivity in asymptomatic people “is an unsolved problem that needs urgent attention to increase confidence in test results for contact-tracing or screening purposes.”
Continued adherence to current measures, such as physical distancing and surface disinfection.
Development of highly sensitive and specific tests or combinations of tests to minimize the risk of false-negative results and ongoing transmission based on a false sense of security.
Improved RT-PCR tests and serological assays.
Development and communication of clear risk-stratified protocols for management of negative COVID-19 test results.
“These protocols must evolve as diagnostic test, transmission, and outcome statistics become more available,” they wrote.
Meanwhile, clinical laboratories remain somewhat on their own at selecting which COVID-19 molecular and serology tests they want to purchase and run in their labs. Complicating such decisions is the fact that many of the nation’s most reputable in vitro diagnostics manufacturers cannot produce enough of their COVID-19 tests to meet demand.
Consequently, when looking to purchase tests for SARS-CoV-2, smaller medical laboratory organizations find themselves evaluating COVID-19 kits developed by little-known or even brand-new companies.
Though experts say an antigen test is not as accurate as PCR tests, its low cost, ease of use, and widespread availability make it a boon for clinical labs performing COVID-19 testing
As former FDA commissioner Scott Gottlieb, MD, explained on Face the Nation, “this kind of technology is a real game changer … it’s a very rapid test that could be used in a doctor’s office. Doctors now have about forty thousand of these Sofia machines already installed in their offices … you do a simple nasal swab and the test itself scans for the antigens that the virus produces.
“The test is about 85% sensitive. So, let’s say a hundred people come into a doctor’s office who have COVID-19, eighty-five of them are going to be able to be tested positive with this test very quickly. It’s a cheap test. It’ll probably be about five dollars a test and you can get a result within five minutes … you’re getting a very fast result and you can start to take action immediately.
“The company itself said that they’re going to be able to produce about two hundred thousand of these tests starting right away. But in several weeks, they’ll be able to produce up to 1.5 million a week. So, this dramatically expands our testing capacity as long as doctors are able to run these tests in their offices.”
Other LDTs That Have Received EUAs
Here’s a look at other laboratory-developed tests from major manufacturers that have received emergency-use authorizations from the FDA:
This test is designed for use with Abbott’s m2000 RealTime system, which is installed in about 200 US medical laboratories, the company says. It can run up to 470 patient samples in 24 hours. As of a May 11 statement, the company said it had shipped more than two million tests in the US.
This test is designed for use with Abbott’s Alinity m system, which the company describes as its “most advanced laboratory molecular instrument,” with the ability to run up to 1,080 tests in 24 hours, according to a press release.
This is a rapid test designed for use with the ID Now system, a compact portable instrument for point-of-care settings such as urgent care clinics. As of May 11, Abbott said it had shipped more than 1.7 million tests in the US, and that it planned to increase manufacturing capacity to two million tests per month.
However, the test has encountered some stumbling blocks. On May 14, the FDA issued an alert stating that the ID Now COVID-19 test could produce inaccurate negative results. This came after researchers at NYU Langone Health, Northwell Health, and Cleveland Clinic reported problems with the test, according to MedTech Dive. Abbott issued a statement suggesting that the problems were due to improper sample collection and handling, however, the FDA said that Abbott had agreed to conduct post-market studies to identify the cause of the false negatives and suggest remedial actions.
This is a qualitative test designed to detect the presence of IgG antibodies following a SARS-CoV-2 infection. The FDA authorized use of the assay on Abbott’s Architect i2000SR system in April, and then followed up with a May 11 EUA for its use on the Alinity i system. In a statement, Abbott said it planned to ship 30 million tests globally starting in May.
In a March statement, the FDA touted this as the first point-of-care COVID-19 test to receive an EUA. The company estimates the detection time as approximately 45 minutes. It is designed for use with Cepheid’s GeneXpert Dx diagnostic software and GeneXpert Infinity systems, which have nearly 5,000 US installations, according to a Cepheid statement.
This test runs on Hologic’s Panther system, which, according to a Hologic press release, can provide results in about three hours and run more than 1,000 tests per day. The company claims that more than 1,000 Panther systems are installed in US labs, and that it expects to produce an average of one million tests per week.
Ortho’s antibody test is designed for use with its VITROS XT 7600, 3600, 5600, and ECi/ECiQ immunodiagnostic systems, which, the company says are installed in more than 1,000 US labs. The Total Reagent Pack is a qualitative test that detects the presence of all antibodies against SARS-CoV-2.
On April 24, Ortho announced it had received another FDA EUA, this one for its Anti-SARS-CoV-2 IgG test, which detects the presence of IgG antibodies. In a statement, the company said it expects to produce “several million” IgG tests per month.
This test is designed for use with Roche’s cobas 6800 and 8800 systems. The 6800 can process up to 384 results in an eight-hour shift, Roche says, compared with 1,056 results for the 8800 model. The company says results are available in about 3.5 hours. In a statement, Roche said it planned to ship 400,000 tests per week.
Roche describes this as a qualitative antibody test that can be used on cobas e series immunoassay analyzers. Testing time is 18 minutes. As of May 19, the test was live at more than 20 US labs, “with plans in the next several weeks to increase to more than 200 commercial and hospital lab sites with the ability to perform millions of tests per week,” the company stated in a press release.
It’s likely the FDA will continue to issue emergency-use authorizations as the agency receives more applications from IVD manufacturers.
In their letter, the Representatives wrote, “As you are aware, the recently enacted Paycheck Protection Program and Health Care Enhancement Act (PPPHCE Act) invests $25 billion in the [Public Health and Social Services Emergency Fund (PHSSEF)], including $11 billion for states, localities, territories, and tribes, to enhance all aspects of COVID-19 testing capacity. This funding is in addition to the funds already appropriated to the PHSSEF under the CARES Act.
“While laboratories are eligible, along with other providers, for these funds,” they continued, “there have been no federal funds specifically designated for the laboratories that have stepped up in this public health crisis and have made significant investments to expand access to COVID-19 testing despite 40-60 percent reductions in regular commercial volume due to the economic lockdowns.
“As laboratories work to maintain their investments in critical resources for testing platforms, reagents, swabs, and PPE, as well as hiring, training, and overtime pay for the laboratory workforce, we urge HHS to direct a portion of funding that has not already been allocated towards these efforts. These funds will ensure that labs can continue to rapidly scale up diagnostic and antibody testing, particularly for healthcare workers, first responders, and other Americans on the frontlines of this pandemic,” concluded the Representatives.
ACLA President Made Similar Plea for Direct Funding to Clinical Laboratories
“In order to deliver accurate, reliable results for patients at a national scale, we must allocate funding to support [clinical laboratories’] expanded efforts,” she said in a statement following an April 27 meeting at the White House.
In her letter, Khani wrote, “It is essential that HHS allocate $10 billion from the fund to support labs’ further expansion of testing capacity to fulfill the testing needs of all of the states and to protect the lives and livelihood of all Americans.
“Further,” she continued, “HHS should note that investing in the nation’s laboratories will not only enhance testing capacity in the short-term, but it also will allow the country to benefit from a robust testing infrastructure for the duration of the COVID-19 pandemic and beyond.”
President Trump signed H.R.266 into law on April 24. It includes $25 billion earmarked for research, development, validation, manufacturing, purchasing, administering, and expanding capacity for COVID-19 testing. According to the language of H.R.266, that includes, “tests for both active infection and prior exposure, including molecular, antigen, and serological tests, the manufacturing, procurement and distribution of tests, testing equipment and testing supplies, including personal protective equipment needed for administering tests, the development and validation of rapid, molecular point-of-care tests, and other tests, support for workforce, epidemiology, to scale up academic, commercial, public health, and hospital laboratories, to conduct surveillance and contact tracing, support development of COVID-19 testing plans, and other related activities related to COVID-19 testing.”
Financial Struggles for Hospitals and Clinical Laboratories
This new round of stimulus funding comes at a time when many providers and clinical laboratories are struggling financially, despite the influx of COVID-19 patients.
“Across the country, laboratories have made significant investments to expand capacity, including purchasing new platforms, retraining staff, and managing the skyrocketing cost of supplies. To continue to make these investments and expand patient access to high-quality testing in every community, laboratories will need designated resources. Without sustainable funding, we cannot achieve sustainable testing,” said Khani in an ACLA statement.
As the COVID-19 coronavirus pandemic evolves, federal regulations, as well as emergency funding for COVID-19 testing that is provided by federal legislation, will evolve in unexpected ways. For that reason, clinical laboratory leaders will want to closely track announcements by such federal agencies as the Department of Health and Human Services, the Centers for Medicare and Medicaid Services, the Food and Drug Administration, the Centers for Disease Control and Prevention, and the Federal Emergency Management Administration as decisions are made about how to assign the $25 billion authorized in H.R.266 for “testing.”