OraSure to conduct more testing on hepatitis C product

OraSure to conduct more testing on hepatitis C product
Thu Jun 25, 2009 8:59am EDT


* Says to conduct additional testing and trial of HCV test

* Sees $3 mln charge

* Says facing problems in manufacturing rapid HIV test

* Says advisory committee to review OTC HIV test study

June 25 (Reuters) - OraSure Technologies Inc (OSUR.O) said it would need to conduct an additional study for its hepatitis C virus (HCV) test as health regulators raised concerns of potential interpretation bias, delaying its marketing approval.

The U.S. Food and Drug Administration indicated that the clinical data could have been biased because the same operators performed the test and interpreted the results on multiple specimen types derived from the same patient, the company said.

In October, OraSure filed a premarket approval (PMA) application for its OraQuick HCV test for use wi th multiple specimen types, including venous whole blood, fingerstic k whole blood, oral fluid and other sample types.

OraSure had expected to address the FDA's concerns without material impact to the clinical program.

However, the FDA recently concluded that additional clinical testing will be required to obtain approval of the PMA for a venous whole blood claim, the company said.

A new clinical study will also be required for approval of claims for oral fluid and other sample types, it added.

The exact timing and costs related to the work will not be fully determined until after protocols are submitted and reviewed by the FDA, which should occur in the next several weeks, the company said.

The company expects to record a non-cash impairment charge of $3 million related to a portion of the milestone payments previously made under a license for certa in HCV patents.

MANUFACTURING ISSUES

OraSure also said it has been experiencing an intermittent difficulty in manufacturing a component required for its rapid HIV test, adding that second-quarter revenue would be hurt if it was unable to resume full-scale production of the test this week.

The OraQuick Advance Rapid test, which detects antibod ies to HIV-1 and HIV-2 in 20 minutes, is approved by the FDA for use with oral fluid, fingerstick or venous whole blood and plasma specimens.

The company also expects gross margin for the second quarter to be negatively impacted primarily due to higher unabsorbed production costs and scrap expenses.

COMMITTEE TO REVIEW OTC TEST

OraSure said the FDA indicated that an advisory committee should review and approve the results of an observed use study and the remaining clinical activities related to the company's over-the-counter (OTC) HIV test.

In August, the company had submitted the results of its observed use study to the FDA to obtain approval for an OTC version of its OraQuick test.

The study was designed to assess an individual's ability to interact with the product packaging, comprehend the instructions for us e, take the test and interpret the results.

Shares of the company closed at $3.28 Wednesday on Nasdaq.