The U.S. Food and Drug Administration (FDA) has approved an at-home coronavirus testing kit from Quest Diagnostics (NYSE: DGX). 

The FDA has authorized the emergency use of six at-home testing kits. One of the first testing kits was approved on April 20, providing public access to those afraid of going into hospitals or testing sites to see if they have the virus or not. It also allows the public to feel a little safer when returning to work or school. Testing has been scarce since the beginning of all of this but now that there are more sites to get tested, it’s best to call ahead to make sure you can get a test. 

These at-home testing kits may or may not be covered by your health insurance, which could result in you paying out of pocket for the at-home test. Additionally, the market for these types of tests is vast because in order to return to “normal,” employees and students will first need to ensure they’re coronavirus-free before returning to offices, schools, and universities. 

Brian Tanquilut, health care service analyst at Jefferies LLC, said: “With more than 20 million college students in the country, that’s a fairly sizable number of tests. It could be a really big market for that reason.”

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These types of places will need to test their students and employees to give reassurance, which would bring a lot of business to the companies that are offering at-home tests. Even Amartya Bose, analyst from Frost & Sullivan, says that at-home COVID-19 diagnostic tests could reach as high as $816 million this year. 

Quest Diagnostics says that it’s planning to get 500,000 kits ready to be sent out by the end of June. These at-home testing kits will allow people to test themselves from the comfort and safety of their homes, and all they have to do is take a swab from their nostril and then send the sample overnight to the testing lab via FedEx. That seems really simple. 

These at-home testing kits would help people determine if they are healthy enough to return to work or visit family they haven’t seen in months. But there are some concerns about the accuracy of these tests. According to Alan Wells, a professor of pathology at the University of Pittsburgh and medical director at UPMC Clinical Laboratories, a sample taken from saliva or a nose swab could give a false negative, especially if the virus has moved to the lungs, which it usually does. 

While the FDA considers nasopharyngeal swabs to be the most accurate, it has authorized the use of nasal tests since they yield comparable results. And some companies have even been putting these at-home testing kits to good use as nurses are being senting to people’s homes with these at-home testing kits. For example, Microdrop LLC has sent nurses to Houston residents who are elderly, disabled, or don’t have access to mass transit to issue at-home testing for those who want it.

Quest Diagnostics CEO Steve Rusckowski said in a press release that: “The self-collection kit enables an individual to self-collect at home, and the process is far less invasive and uncomfortable than many traditional methods.” Not to mention, at-home tests give more people the ability to know if they are asymptomatic so that they can then take the necessary precautions to not infect others.

These tests are going to be more accessible to the public, putting some money into these companies’ pockets, so those 20 million college students plus faculty who will need to be tested regularly until there is a vaccine is just a glimpse at the demand of this market. Laboratory Corp. of America Holdings charges $119 to consumers for receiving their tests directly, so you do that math. With tests around $100-$150 and millions wanting to be tested, this will be big for companies providing at-home coronavirus testing kits.

Until next time,