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US Senate Passes Coronavirus Relief Package Including $25B for Testing Improvements

NEW YORK – The US Senate on Tuesday passed a $484 billion coronavirus relief package that includes $25 billion for COVID-19 testing.

The package is to help US small businesses that have been hurt by the pandemic, and the US House of Representatives is expected to measure on the bill on Thursday.

Included in the package is $25 billion broadly for testing for SARS-CoV-2, the coronavirus that causes COVID-19, including for the research, development, validation, manufacture, purchase, administer, and expansion of coronavirus testing capacity. The bill covers both molecular and serology testing, personal protective equipment needed to administer the tests, and support for increasing the workforce to do the testing. It also includes funding to scale up academic, commercial, public health, and hospital laboratories to conduct surveillance and contact tracing of COVID-19.

Specifically, $11 billion will go to states, localities, territories, tribes, and employers to scale up SARS-CoV-2 testing, including $2 billion allocated to states consistent with the US Centers for Disease Control and Prevention's Public Health Emergency Preparedness Program's grant formula, and $4.25 billion given to states based on the relative number of COVID-19 cases.

The package also allocates $1 billion to CDC to support surveillance efforts, expand laboratory capacity, and increase workforce support to improve testing.

The National Institutes of Health would get $1.8 billion to develop technologies for SARS-CoV-2 testing. The National Cancer Institute would get at least $306 million to develop coronavirus serology tests, while the National Institute of Biomedical Imaging and Bioengineering would get at least $500 million to accelerate the research and development of point-of-care and other rapid tests for the coronavirus. The remaining $1 billion would go to the NIH Office of the Director, also to develop and implement testing, and accelerate research and development in point-of-care and other rapid testing technologies.

The US Department of Health and Human Services' Biomedical Advanced Research and Development Authority would receive $1 billion for the research and development of diagnostic, serology, or other SARS-CoV-2 tests or related supplies.

Another $1 billion would be set aside to provide testing for the uninsured.

"ACLA urges HHS to quickly provide clarity on how the funding will be allocated to support hotspots and high-risk populations, as well as broader efforts to increase high throughput testing nationwide," American Clinical Laboratory Association President Julie Khani said in a statement. "Continued support and funding for high-throughput testing from commercial, hospital, and academic laboratories is essential to achieve both of these goals."

In a research note, Puneet Souda of investment bank SVB Leerink wrote that the $25 billion will help improve COVID-19 testing overall, while "expansion in testing research will help the diversified tools companies" such as Thermo Fisher Scientific, Bio-Techne, and Agilent Technologies.

Barclays' Jack Meehan, meanwhile, said that national labs "could see both a direct and indirect benefit from the fund, with direct investment and indirect test ordering if state and federal agencies order testing from the national labs."

He also noted that the $4.25 billion targeted to states, based on the number of SARS-CoV-2 cases detected, could push states to do more testing and identify more positive cases of coronavirus infection.

The lack of testing in the US has been an ongoing source of criticism of the Trump Administration. Because of what many has seen to be its slow response to the pandemic, as well as missteps along the way, too few people have gotten tested. According to the Covid Tracking Project, as of the end of Tuesday, just short of 4.2 million individuals in the US had been tested, with almost 800,000 positive cases confirmed. 

In contrast, Cowen analyst Doug Schenkel said in a research note on Tuesday that his analysis suggests that between 45 million to 85 million tests through Aug. 4 could be needed in the US and Europe in order to "return to normalcy." At least 20 million tests could be necessary in the US for symptomatic testing of patients through the 2020/2021 respiratory season, he said.