Hauppauge firm receives $28 million order from Brazil for COVID tests

Chembio Diagnostics Inc. has received an order for its coronavirus antigen test from Brazil that’s larger than the Hauppauge company’s sales for all of 2020.

The $28.3 million purchase order for the DPP SARS-CoV-2 antigen test is 14% higher, or $4 million more, than Chembio’s total sales last year of tests for malaria, HIV, syphilis and other infectious diseases.

The 20-minute test involves a nasal swab and detects the COVID-19 antigen that indicates an active infection.

The purchase order was made by Bio-Manguinhos, which supplies tests, vaccines and other medical supplies to Brazil’s public health system. Chembio has a subsidiary in the country and has collaborated with Bio-Manguinhos on fighting HIV, Zika and other diseases for years.

The antigen test was first approved by Brazilian regulators in November. After the United States, Brazil has recorded the most COVID deaths since early 2020 — nearly 546,000, according to Johns Hopkins University. Brazil is No. 3 in number of cases after the United States and India.

"Enabling providers to test patients at the point of care and determine their infection status in only 20 minutes can be one of the most effective methods for controlling the spread of COVID-19 and improving patient outcomes," said Javan Esfandiari, Chembio’s chief science and technology officer. "We believe the purchase order validates the investments we made earlier this year in inventory for the [antigen test] and look forward to ramping up production."

The test was developed in Hauppauge at the company’s headquarters, laboratory and factory. It also be produced in Hauppauge.

Development of the test was supported by two grants last year, totaling $13 million, from the Biomedical Advanced Research and Development Authority, which is part of the U.S. Department of Health and Human Services.

The U.S. Food and Drug Administration so far has declined to review Chembio’s antigen test for Emergency Use Authorization, or EUA.

In June 2020, Chembio’s COVID antibody test lost EUA after the FDA found inaccurate results in some cases. The company has since made changes to that test, but federal regulators have declined to review them so far.

Antibody tests check patients’ blood for antibodies, which can show if they had a past infection with the virus.

The purchase order for the antigen test comes as a revenue shortfall has "limited cash" for Chembio, leading to the proposed sale of up to $60 million in additional stock.

The company estimated revenue of $6.4 million for the three months ended June 30 compared with $8.7 million in January-March, according to a securities filing.

Chembio reported a loss of $25.5 million last year on revenue of $32.5 million.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.