How The FDA Cut Bureaucratic Red Tape To Make Coronavirus Home Testing Available – Forbes

Posted: June 24, 2020 at 8:48 am

Everlywell COVID-19 Home Collection Test kit

Startup Disrupts Medical Testing Industry

Sometimes, to disrupt an industry, you need an outsider's perspective. Other than being a dissatisfied consumer, Julia Cheek had no expertise in healthcare. Trying to find out why she was experiencing debilitating fatigue, doctors ordered a battery of tests. Even with good insurance, she still had to pay more than $2,000. Fortunately, it turned out she had easily treatable vitamin and hormone deficiencies. There had to be a better way, she thought. And, that better way could be used during the coronavirus pandemic.

The technology to do biological testing at home has existed for more than a decade think DNA genetic testing like Ancestry and 23andMe but no one had thought to use it for medical tests. Cheek launched Austin-based Everlywell in 2015 to provide at-home lab testing kits and digital results within just days for things such as cholesterol, food sensitivity, fertility, STDs, and thyroid problems.

Even though she had a Harvard MBA, as a woman and solo founder of a healthtech company, she was ignored by venture capitalists. "What I learned is that it only takes one 'yes,'" said Cheek. Helping to get people to say "yes" was the fact that the company had significant market traction generating $250,000 in sales per month.

An angel investor, Craig Barrett, and a micro venture capital firm, SoGal Ventures, invested in the first quarter of 2017. She landed a $1 million loan at 8% plus help with sales and marketing for a 5% stake from Shark Tank investor Lori Greiner in November 2017. Sales doubled overnight, said company spokesperson. Christina Song. In April of 2019, the company received $50 million in venture capital led by Goodwater Capital. The capital round also included Highland Capital Partners and NextGen Venture Partners. In March 2020, Everlywell was recognized as the third fastest-growing company in Texas, by Inc. 5000. Thanks in large part to Greiner's knowledge of brick and mortar retail, in the two years since her involvement, Cheek announced on a recent Shark Tank update segment that Everlywell's sales have grown from $2.5 million in sales annually to $65 million.

Spotting The Potential For A Pandemic Early

Everlywell's Chief Medical and Scientific Officer, Frank Ong, MD, had been in Asia when SARS broke out in 2002-2003. He understood the risks posed by the new coronavirus identified at the end of 2019. On a business trip in January 2020, he and Cheek discussed his fears that COVID-19 could develop into a pandemic. By February, it was clear the virus was spreading and testing was not keeping pace. "That's when we got into gear," said Ong.

With over 250,000 CLIA-certified labs in the U.S., Cheek saw an opportunity to increase the United States' capacity to do COVID-19 testing as well as to limit exposure to the coronavirus and reduce the potential overload of healthcare facilities through home sample collection. For Everlywell, increasing lab testing capacity wasn't a pivot. It was in line with its values of providing easy and convenient testing. Even though the startup wasn't profitable, the board gave Cheek a quick thumbs up for a $1 million initiative to help smaller labs be FDA compliant.

On March 8, 2020, the company announced a $1 million development incentive to any certified laboratories who fulfilled requirements set by the Federal Drug Administration (FDA) and Everlywell to prioritize the development of a COVID-19 diagnostic test. "The money would help small labs get proper testing up and running," said Ong. This would help home testing to become an essential part of the national response.

Earlier in March 2020, a couple of other companies started selling at-home COVID-19 tests for consumers. Everlywell announced the launch of an at-home sample-collection kit that it believed was permitted under an FDA policy. The FDA stopped everyone because it said it had not yet authorized any self-administered tests at home. The false start was due to confusion in the interpretation of FDA guidelines. The good news was that the FDA did see the public health value in the tests and wanted to work with companies.

If At First You Don't Succeed Try, Try Again

Everlywell worked with the FDA to secure an Emergency Use Authorization (EUA) for its kits before sending any to consumers. EUA allows the FDA to help strengthen the nation's public health protections against chemical, biological, radiological, and nuclear (CBRN) threats by facilitating the availability and use of medical countermeasures (MCMs) needed during public health emergencies. Without the EUA, Ong's experience was that it took 1 1/2 to 2 years for FDA approval. Under the EUA and with Ong's knowledge of aggregating clinical trial research, including data from studies from the Bill & Melinda Gates Foundation and UnitedHealth Group, showing self-collected specimens could remain stable through the mail.

Everlywell COVID-19 Home Collection Test Kit

Everlywell's COVID-19 Test Home Collection Kit became the first stand-alone sample collection kit to be granted an EUA by the FDA. Everlywell's offering is unique because its sample kit is independent of any specific testing lab. It can work with a variety of labs to potentially provide a broader testing footprint.

"The authorization of a COVID-19 at-home collection kit that can be used with multiple tests at multiple labs not only provides increased patient access to tests but also protects others from potential exposure," Dr. Jeffrey Shuren, director of the FDA's Center for Devices and Radiological Health, said in a statement. "Today's [May 15] action is also another great example of public-private partnerships in which data from a privately funded study was used by industry to support an EUA request, saving precious time as we continue our fight against this pandemic."

For now, Everlywell charges for its home test but makes no profit. However, the company is working with insurance companies to get the test covered and with Congress to make the test free.

During the eight weeks Ong was working with the FDA on approval for the company's COVID-19 test, Everlywell implemented work-from-home procedures and cut all discretionary spending. It also provided tests to healthcare and frontline workers.

How can you put together the team and the resources to help you overcome hurdles?

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How The FDA Cut Bureaucratic Red Tape To Make Coronavirus Home Testing Available - Forbes

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