Cue Health, a rapid diagnostics startup with a connected testing device platform, has been awarded $481 million from HHS and the Department of Defense (DoD) to expand production of a COVID-19 molecular test that received an Emergency Use Authorization back in June.

According to announcements from the government and the startup, the money will be used to deliver six million COVID-19 molecular tests by March of next year, by which time Cue is expected to have a production capacity of 100,000 tests per day.

The point-of-care test uses a nasal swab sample collected from the lower nose to detect the presence of SARS-CoV-2 RNA, and transmits its test results from the startup's reusable cartridge reader device to the corresponding Cue Health App. Each single-use test kit produced by the startup includes a sample wand and COVID-19 test cartridge.

WHAT'S THE IMPACT?

Diagnostic testing has been something of a sore spot amidst the U.S.'s response to COVID-19, with shortages and long turnaround times keeping individuals from receiving the diagnoses they may need to self-quarantine. Ample production of a point-of-care test that delivers its results in roughly 20 minutes can help address that.

"We are excited to be part of this historic, first-of-its-kind initiative led by the U.S. Government to deploy point-of-care molecular testing to protect the health of Americans,” Ayub Khattak, founder and CEO of Cue, said in a statement.

“Our vision in designing the Cue Health Monitoring System was to enable individuals to have more control over their health and lives by providing access to actionable, accurate health data in real time. The U.S. government’s support has and will allow us to fulfill this vision in this particularly critical moment.”

But of course, the deal is also a major boon for the San Diego connected diagnostic developer. In addition to its COVID-19 efforts, Cue Health has also been working on a version of its platform for at-home influenza testing, and has said that it wants to expand its capabilities across a broader spectrum of infectious diseases.

Cue Health will be coming out of this project with a major upgrade to its manufacturing facilities, as well as a high-profile contract with the U.S. government that should help the startup make a name for itself within the busy field of rapid diagnostics.

THE LARGER TREND

Yesterday's announcement comes only a few months after Cue Health hauled in a $100 million Series C funding round, which it said at the time would be put toward test development and scaling its manufacturing capacity.

Also of note is that this isn't the startup's first brush with government agencies. Since 2018, it's held a partnership with the HHS' Biomedical Advance Research Development Authority (BARDA) that supported the development of its molecular influenza test, which was expanded in March to help accelerate this same COVID-19 test.