2012-05-31 / Local & State

Penna. Firm Pioneers Rapid Medical Tests



BETHLEHEM, Pa. (AP) – On Jan. 31, 2003, during a speech about the fight against HIV, President George W. Bush announced a key approval for a rapid test that could get far more infected people into treatment and slow the spread of the disease.

Earlier this month, a federal advisory committee approved selling an oral swab version of that test over the counter to what regulators projected could be 2.8 million people in the first year. And ... the Centers for Disease Control and Prevention proposed that every baby boomer in the United States should be tested for hepatitis C.

The common thread? Only one company – Ora- Sure Technologies Inc. of Bethlehem – makes an oral rapid HIV test. It also makes the only fast test for hepatitis C.

President and CEO Douglas A. Michels was in the thick of it all week: Tuesday watching the Food and Drug Administration panel that recommended the HIV test for use at home; Wednesday and Thursday as the industry representative on the Presidential Advisory Council on HIV/AIDS; and Friday in New York City, which kicked off a hepatitis C screening campaign using his test.

The HIV test alone could bring $50 million in annual sales at the end of five years to a company that had less than $82 million in revenue last year, said analyst Jeff Frelick of Canaccord Genuity, a Boston investment bank.

The week’s events were “a reaffirmation of the value of our rapid technology and how it can be used and how it can make a big difference in public health,’’ said Michels, whose reserved demeanor as head of a publicly traded company contrasts with the quirkiness of its founders.

They still seem to get a kick out of how it all started in 1987. The cofounders who grew the company were friends of friends – a scientist, a finance specialist, and a marketing executive – with an idea for a sunscreen towelette. They decided to move forward over pizza and beer.

“We had no idea what we were getting into, to be completely blunt,’’ said Mike Gausling, who left his job as a young financial analyst at Procter & Gamble to try life as an entrepreneur.

Chemist Sam Niedbala, who had been at Hoffman- LaRoche and started working on the towelette in his home basement, ascribed the small company’s ability to get a range of products – the sunscreen (licensed to Coppertone), cryosurgical wart remover, tests for drugs of abuse – on the market to a “fighter pilot mentality: we were never going to get shot down.’’

They settled in Bethlehem because Niedbala knew from his doctoral work at Lehigh University that there was a state-funded business incubator there. The incubator provided $245,000 in seed money to what was then known as SolarCare Inc.

It also played a role in putting the company atop an old iron ore pit, with skeletons of the old Bethlehem Steel complex a few hundred yards away – a symbolic decision as the city struggled to evolve from old tech to new.

The company “was one of the early success stories that created that whole metamorphosis,’’ said Laura S. Eppler, marketing director for Ben Franklin Technology Partners of Northeastern Pennsylvania, which operates the incubator.

People inside and outside the company note its success at quickly adapting as market conditions change.

By the late 1990s, much of its business involved laboratory substance-abuse tests. An Oregon company, Epitope, had developed a device that could collect and transport oral fluid specimens without the hazards of needles and blood. The executives in Bethlehem wanted it for a broad array of drug tests.

The companies merged in 2000 as OraSure Technologies. The new public company provided a windfall to the several dozen employees. The founders, now millionaires, left over the next few years.

Epitope also had developed a rapid HIV test but had not yet sought FDA approval. A strategic review suggested a major new direction: rapid tests for infectious diseases. An Internet survey confirmed huge interest in tests that could be done in the privacy of the home. How much people hate needles soon became clear as well.

“Patients prefer an oral sample 10 to 1 vs. blood,’’ Michels said.

OraSure’s rapid oral fluid HIV test for professionals was approved by the FDA in 2004 and is still the only one on the market. That test had been approved for blood two years earlier, a milestone announced at a news conference by Tommy Thompson, the U.S. Health and Human Services secretary. More than 25 million have been sold.

More than half of the estimated 50,000 new cases of HIV every year were caused by by people who did not realize they were infected. Some got laboratory blood tests but never returned to hear the results, which take days. A rapid test gives results in 20 minutes, and the CDC has run large campaigns around OraSure’s product.

Powerful new drugs have made HIV “a chronic condition that can be managed,’’ said Stephen Lee, OraSure’s chief science officer.

The weak link in the chain is finding out whether one is infected, which requires visiting a testing clinic or getting a test from a physician. Many people don’t feel comfortable doing that. Many would, however, buy a test in a pharmacy that they could take at home.

Until last week, no FDA advisory committee had ever approved an over-the-counter test for infectious disease, fearing that untrained people would make too many mistakes or that the results would not be accurate. The agency usually follows its committees’ advice but is not bound by it.

Over the years, OraSure has developed close ties with the HIV community, hiring workers from nonprofits and health departments, helping to organize testing campaigns, and seeking advice.

“They listen to the community,’’ said Karam Mounzer, medical director of the AIDS service organization Philadelphia FIGHT. Mounzer was the principal investigator for the Philadelphia sites of two recent OraSure clinical trials, for the rapid HIV and hepatitis C tests.

The HIV test is simple. With a swab of the gums (or a stick of the finger), a minuscule amount of fluid is absorbed by a pad. The pad is then inserted in a vial of liquid. The liquid travels up the strip, picking up nanoparticles of gold conjugate.

If there are any human antibodies to anything in the solution – basically, if it is human fluid – the gold shows up as a reddish-brown horizontal line. If there are HIV antibodies, it creates two horizontal lines.

Because the immune system does not produce antibodies for a couple of months after infection, it will not pick up new infections. And positives must be confirmed by a laboratory blood test.

The hepatitis C test works only with blood and is not being considered for over-the- counter sale, at least not yet. Still, the product could be lucrative. The CDC estimates one in 30 baby boomers – up to 1.5 million people – are infected with the virus but don’t know it.

Chief operating officer Ronald H. Spair said Ora- Sure was profitable several years ago but decided to burn through millions of dollars in cash to simultaneously pursue the first rapid hepatitis C test, which won FDA approval last year, and home use of the rapid HIV test.

The professional version of the HIV test accounted for more than half the company’s revenue last year. Officials said they could have the test on retail shelves 30 to 60 days after FDA approval. It is manufactured in Bethlehem, where most of OraSure’s roughly 300 employees work, and executives said there was plenty of capacity to ramp up production.

“We don’t expect competition in over-the-counter in the near term because as far as we are aware, no one has even begun the study process,’’ Michels said. “I think it will be years.’’

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