COVID-19: 'There will be a longtime and very stable demand for COVID tests,' says iHealth CEO
Traditional medical diagnostics companies have been in high demand in the past two years, but the unprecedented need for testing during the pandemic also opened the door for new entrants.
Among those is iHealth maker Andon Health. Andon is a China-based company with a subsidiary, iHealth Labs, in California. The medical device maker has become one of the most popular for at-home antigen tests — and the U.S. government is its biggest customer in an effort to provide free COVID tests to all Americans.
iHealth CEO Jack Feng told Yahoo Finance the company began developing an antigen test in March 2021 and received authorization in November, with the company easily able to ramp up production amid the pandemic.
"We are one of the test kit makers who can provide massive production capacity, because we have production in China, and we are manufacturing mainly in China," Feng explained.
The company can produce more than half a billion tests a month, he added, noting that demand has cooled in recent months — even with ongoing surges.
The Centers for Disease Control and Prevention (CDC) estimates more than 67% of the U.S. is now in areas of medium or high risk of COVID-19.
Meanwhile, the company is keeping busy developing new products including a multi-panel flu and COVID test, as well as working on scaling up manufacturing in the U.S., Feng said.
"Hopefully, we will have our own manufacturers in the U.S. in two months," he said. Onshoring would likely increase production costs compared to China, Feng noted, "But I don't see that will dramatically affect the retail price," he said.
A captive market
iHealth has been selling its products direct-to-customer on its website, and is now also on Amazon, and the tests are selling very well, Feng said, though demand is nowhere near what it was in January of this year.
"But we do see that there will be a longtime and very stable demand for COVID tests," said Feng, who believes the company could easily have about 50% of the at-home antigen test market share.
That explosion in business is likely to help build brand recognition for the company in the future, he said.
In April, the company received the greenlight from the FDA to distribute its test under the brand name "GoToKnow."
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