The drop in Abbott came after the Food and Drug Administration said it was investigating preliminary data that found the company's rapid test could miss covid-19 cases.
“Although it remains to be seen if there are repercussions from this study’s results, the headlines come at a time when new rival tests are coming online, including QDEL’s rapid antigen Sofia,” J.P. Morgan analysts, led by Tycho Peterson, wrote in a report obtained by Bloomberg.
The FDA granted emergency use authorization earlier this month for Sofia. Former FDA Commissioner Scott Gottlieb termed it a “game-changer,” according to Bloomberg
But not everyone is gung ho about the Quidel test. The J.P. Morgan analysts point out there are many doubters. And earlier this week, they lowered their rating on the stock to underweight, after it soared almost 200%.
As for Abbott, the FDA analysis found that its ID Now missed at least a third of positive cases detected with a rival test and much as 48% when using the currently recommended dry nasal swabs.
The test is used daily at the White House to test President Trump and other members of his staff, including the coronavirus task force.
Abbott rejected the findings, saying the researchers used the test “in ways that it was not designed to be used.”
Quidel shares recently traded at $195.11, up 5.05% and have jumped more than 130% over the last three months.