LI manufacturer says it will make 1 million coronavirus tests in May

A Hauppauge manufacturer expects to produce one million diagnostic tests for the coronavirus in May and up to 2 million tests per month by September, according to a securities filing.

Chembio Diagnostics Inc. outlined plans Monday to convert all its production lines in Hauppauge, Medford and Brazil to  blood tests for the coronavirus. The result readers are made in Germany.

The company had been focused on tests for HIV, syphilis, Zika, Ebola, dengue and other infection diseases, but demand has dropped, executives said. They cited a 20% drop in revenue in the January-March period compared with a year earlier.

Chembio is competing in a crowded field with larger rivals that also have 15-minute tests for the deadly virus. They include Abbott Laboratories in Illinois, BioMedomics Inc. in North Carolina and SD BioSensor Inc. in South Korea.

Chembio’s new CEO, Richard Eberly, said, “We are scaling production of these tests due to the strong demand we are experiencing. We believe the features and benefits offered by our DPP COVID-19 System will make it a preferred solution.”

The company has begun shipping coronavirus tests to Brazil, from which it received a $4 million order in March, and some customers in the United States. To accommodate the production changes, 10 people  have been added to the factory workforce of 230, the securities filing states

Chembio received a $1 million grant on April 24 from New York’s primary business-aid agency, Empire State Development, to make tests for sale in the state. The company also secured a $3 million Paycheck Protection Program loan to pay the wages of 256 U.S. employees for two months.

Chembio has spent $800,000 on tooling, robots and hiring, the filing states. It also plans to mothball a plant in Malaysia and terminate 30 employees there, costing between $300,000 and $600,000 by June 30. 

“We are currently focusing our sales efforts on target hospitals and state and city health departments,” the company said in the filing. “We anticipate there will be increasing interest from larger institutions and employers as the world evaluates its path back to work and whether individuals may have been exposed to COVID-19 and may have immunity.”

The Chembio test, developed with British test maker LumiraDX, helps to determine a patient’s current and past exposure to the coronavirus by detecting IgM and IgG antibodies that are produced by the body in response to the virus. The test is being used at Stony Brook University for a 500-person study to see if the blood of coronavirus survivors can help those critically ill with the virus.

Chembio also announced Monday that its coronavirus test has won the CE mark, meaning it can be sold in Europe and most of the Caribbean.

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.