One molecular diagnostic company is cutting through the noise and reaching investors’ ears with a rapid COVID-19 test. Cue Health said Wednesday it has raised a sizeable $100 million in a series C financing to help support the development and commercialization of its tests, which includes a molecular diagnostic for COVID-19.
Decheng Capital, Foresite Capital, Madrone Capital Partners, Johnson & Johnson Innovation - JJDC, Inc., ACME Capital, and other investment firms helped finance contributed to the San Diego, CA-based company’s Series C round.
“We’ve been working on this ever since swine flu, realizing the problem we saw then, was going to come back and be worse at some point,” Ayub Khattak, co-founder and CEO of Cue told MD+DI. “We knew we would need a better solution on the diagnostic side.”
Previously, Cue raised $45 million in a Series B round. The firm said in addition to private financing, it has been awarded contracts totaling more than $30 million by the U.S. Department of Health and Human Services’ Biomedical Advanced Research and Development Authority. The company said the BARDA funding has helped enable Cue to accelerate the development of its influenza and COVID-19 tests.
Khattack and Clint Sever, Cue’s Chief Product Officer founded the company with an emphasis on answering the question “What If?”
Khattack added, “We wanted to have a molecular test that was very easy to use and rapid in terms of the turnaround time. We also wanted to have it connected to a mobile device.”
But the COVID-19 diagnostic isn’t the sole test the company has in development.
“We have a number of products in development,” Sever told MD+DI. “One of those products is influenza and we’ve been developing the product for a long time. We’re seeking consumer and professional use as a 510(k) clearance for that product …”
If the diagnostic gets a nod from FDA it could be the first at-home molecular flu test that is rapid (~20 minutes) and enables connectivity via telemedicine networks to a healthcare provider of the patient’s choice. Cue also anticipates the introduction of a series of infectious disease tests and products for other test categories in the coming years.
He added, “For our COVID-19 cartridge, we’re seeking emergency use from FDA. That’s intended to be used by operators in a point-of-care environment.”
Eventually, the Cue plans to seek FDA clearance for the COVID-19 test.
Cue Cuts through the Clutter
There have been about 96 diagnostic-related products for COVID-19 that have received a EUA, according to FDA’s website. MD+DI has been documenting the companies receiving EUA’s since FDA announced its COVID-19 plan, earlier this year.
With so many tests already out there, the competition could be fierce. But Khattack doesn’t see it that way.
“Almost all of the (COVID-19 test) EUA’s – all but three of them - are for laboratory use,” he said. “So, in that situation, you’re probably looking at multi-day turnaround or at least several hours. So, in the category of quick molecular tests, there are three that have been authorized, so there’s not enough in our category.”