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$5, 15-minute COVID-19 Test Approved (making me money!)


MickinMD
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Abbott Labs just got FDA approval for it's new 15-minute, $5 COVID-19 test.  The stock is up over 7% at 11:20 am.  It will soon be shipping tens of millions and tens of millions and tens of millions beginning in September.

Hopefully, the tests will prove good.  Note it was FDA approved despite Trump saying tests should be cut way back, so there's good reason to expect it to work.

Abbott Labs is my largest and oldest (since 1993) stock holding and I still automatically contribute $25/month to it through it's no-fee DRIP administered by computershare.com (plus occasional larger purchases).  If I was allowed to own only one stock, it would be Abbott Labs: #1 in nutritionals (Similac baby formula, Ensure, etc.), #1 in quick medical tests, #1 in certain types of hospital equipment, and more with 60% of sales overseas.  Similac is so trusted it's the #1 baby formula in China as well as most of the rest of the world.  It's one of the safest stocks in the world with a long record of success, paying a dividend every quarter since the early 1920's - right through the Great Depression, etc.

If you research it, most analyses ignore that fact that it split in 2 in 2013 and only half the company remained as ABT - yet it's numbers are still good!

At the end of 2012, ABT stock was $57/share.  On the first business day of 2013, it spun-off its pharmaceutical division as AbbVie (ABBV) and we ABT stockholders got 1 share of ABBV (nominally worth $35) for every share we owned of ABT (nominally worth $32) - so we got a $10 profit just from the split alone.  Today ABT is around $110 (1.3% dividend) and ABBV $95 (5.0% dividend). I also automatically contribute $25/month to AbbVie's no-fee DRIP administered by shareowneronline.com

AbbVie is one of the major pharma companies working on a COVID-19 vaccine.  It owns and makes the world's largest selling med, Humira (reduces the signs and symptoms of moderate to severe rheumatoid arthritis in adults and inhibits further damage), whose U.S. patent expires in 2023 thanks to our corrupt both-parties in Congress passing loophole-laws so companies can get away with keeping patents beyond the designated 17 years., but it is quickly replacing lost sales with new meds (Europe, less corrupt than Congress, already has Humira generics and AbbVie worked out deals for 2023+ with American generic makers] and AbbVie bought Allergan (Botox, etc.). Humira, despite record sales in 2020, now represents less than 40% of Abbvie's sales compared to 62% a few years ago.  AbbVie is working on a successor to Humira which would have 17-year patent protection.

Note that Humira "generics" are actually called "Humira Biosimilars" because AbbVie uses a secret microbe to convert a synthesized part of the chemical components into a molecule used in the final synthesis of Humira, much like yeast converts sugars to alcohol.  So it's not clear if the "generics" are the same as Humira because their makers are guessing on the microbe, etc. and sales of Humira generics outside the USA began to drop when generics appeared in 2018 but, by late 2019, Humira sales were picking up in those countries: apparently the "generics" weren't as good.

Abbott Labs and AbbVie have made me very, very happy over the years.

Abbott Labs Stock Jumps After FDA Approves Its 15-Minute, $5 Coronavirus Test

U.S. government approval of a cheap and fast coronavirus test from Abbott Laboratories (ABT) sent ABT stock soaring to a record high Thursday. Shares of rivals Quest, Co-Diagnostics and Quidel, meanwhile, plunged.

The Food and Drug Administration late Wednesday granted approval for the test, which can deliver results in 15 minutes and cost $5.

Abbott Laboratories said it will ship tens of millions of tests in September, ramping to 50 million tests a month at the start of October.

ABT stock jumped 7.6%, near 111, in morning trading in the stock market today. Earlier in the session, it notched an all-time high of 113.72. That topped Wednesday's then-record high of 103.29 for ABT stock.

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8 minutes ago, Kzoo said:

Is this just one more in the growing pile of antigen tests that prove to be inaccurate?

I hope not, but Abbott had one before that wasn't so good.  Still, FDA approval despite Trump wanting to cut way back on testing is a good sign.

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Can't they price it at $500 and make more money?  Make the $5 price be the "negotiated" price, but keep it at a nice simple $500 or $5,000 for those without prescription benefits?  They could always then run ads mentioning their willingness to "help" if you can't afford the price.

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2 minutes ago, Razors Edge said:

Can't they price it at $500 and make more money?  Make the $5 price be the "negotiated" price, but keep it at a nice simple $500 or $5,000 for those without prescription benefits?  They could always then run ads mentioning their willingness to "help" if you can't afford the price.

You nailed it.

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12 minutes ago, donkpow said:

I note that pharmacies are pushing flu vaccines hard right now. Your CVS position will grow.

CVS stock has been a strange creature ever since I bought it a few years ago.

It acquired Aetna Insurance, which gave it 21 million additional Pharmacy Benefit Management customers and the stock dropped because of the new debt - which CVS can easily cover.

I added to it on 2/25 for a dirt-cheap $64.84 and it's $63.37 now.  I still think it will be over $100 within a couple years based on a detailed study of fundamentals including the three financial sheets in its annual reports for the past several years, etc.

Fortunately, my other two big adds while stocks were down have done spectacular.

Cracker Barrel Old Country Store, adding about 1/5 to my position on 3/16 at $62.27 is now $128.26. It's up over 5% today (the S&P 500 is up 0.6%) because it's 80-restaurant let's-do-alcohol experiment with beer, wine, mimosas, etc. has gone spectacularly well.

Southwest Airlines, adding 65% more shares to my position on 5/5 at $25.45, is $37.90 now. It's up over 4% today because "Southwest Airlines LUV dominated headlines by virtue of its commentary that air-travel demand picked up in August..." and because it turned down a government offer of a $2 billion plus loan, saying it didn't need it.

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Abbott had a factory next to the Great Lakes naval Training center in Michigan. They collected urine from the recruits to make a clotting agent for hemophilia. If you were a recruit back in the sixties you did your share of guarding the head. They had to make sure nobody tampered with the urinals.

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28 minutes ago, maddmaxx said:

Profiting from misery.

Charging $5/test is certainly not anything close to as vicious as what other companies are charging for multiple-day tests.

Maryland bought 500,000 test kits from South Korea, when none could be had in the USA, for $9,000,000.  That's $18/test for 5 day tests that required laboratory work with additional time and materials.  This $5 kit is all-in-one and will save states and countries millions of dollars and time in comparison.

IF if works!

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16 minutes ago, Razors Edge said:

Can't they price it at $500 and make more money?  Make the $5 price be the "negotiated" price, but keep it at a nice simple $500 or $5,000 for those without prescription benefits?  They could always then run ads mentioning their willingness to "help" if you can't afford the price.

Have you noticed that the companies with vaccine candidates are saying, "We don't want to profit" but are planning to charge hundreds of dollars more per shot than it costs to make?

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15 minutes ago, MickinMD said:

Have you noticed that the companies with vaccine candidates are saying, "We don't want to profit" but are planning to charge hundreds of dollars more per shot than it costs to make?

And they should!  Vaccines for something like this should be thousands of dollars (or more).  This is life or death for some folks, so why shouldn't folks be willing to pay for it?  Just makes no sense. No one's giving away Ferraris or Lambos!  You might want to speak at the next shareholder meeting and ask why your interests are being ignored.

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1 hour ago, MickinMD said:

Maryland bought 500,000 test kits from South Korea, when none could be had in the USA, for $9,000,000.  That's $18/test for 5 day tests that required laboratory work with additional time and materials.  This $5 kit is all-in-one and will save states and countries millions of dollars and time in comparison.

Now you are confusing antigen tests with viral tests.

 

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2 hours ago, maddmaxx said:

Profiting from misery.

And why is that wrong?

Marking up a drug 1000% percent is profiting from misery, and immoral

Letting people die for political gain is profiting from misery, and immoral

Selling snake oil is profiting from misery, and immoral.

Owning stock in a company that is going to make a profit selling test that will have a HUGE positive impact in stopping the spread of a disease, especially when they are selling it at less than 1/2 of 1% of the current testing cost, is just investing.  

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