COVID-19 pandemic is still sweeping through the world impacting the global economy in significant ways. However, many countries have been able to start economic activities by adopting the testing, tracking, and tracing (TTT) strategy. Due to the emphasis on testing, the global demand for COVID-19 testing is expected to go further up in the coming months. Diagnostic companies are at the forefront in assisting governments to meet the rising demand for testing in their countries. Several in vitro diagnostic (IVD) companies based in the Asia Pacific (APAC) region have emerged as key suppliers of COVID-19 testing.
In Malaysia, the government relied on stringent movement control restrictions (MCO) during the initial stages of the pandemic as the country was trying to meet the rising demand for COVID-19 tests. The diagnostics and life sciences companies in the country rose to the challenge and assisted the government by developing the required reagents as well as tests. Currently, many of these companies have expanded beyond the borders of Malaysia by exporting their COVID-19 tests and to international markets.
Dr. Syamala Ariyanchira, Research Director of AcuBiz Consulting talked with Mr. Law Eng Lim, Founder, and CEO of Vivantis Technologies and Reszon Diagnostics International, about the emerging market trends in various countries for COVID testing and how he plans to navigate through this uncertain terrain.
SA, AcuBiz: Thank you very much for taking the time from your busy schedule. In fact, I had listened to one of your talks during the BioMalaysia conference many years ago. At that time, Vivantis was being recognized as a promising start-up life sciences company in Malaysia. It was amusing to hear the story of how you coined a unique name for your start-up, Vivantis, from ‘We Want This’.
When did you start Vivantis and Reszon Diagnostics? What are the focus areas of these two companies?
Mr. EL Law: Well, Vivantis is a research-based biotechnology company, founded in 2002. Way back then, I had this idea of studying biodiversity – of screening the enzymes of various environmental bacteria, especially the bacteria found in the soil and water, for extracting the enzymes that can act as molecular scissors to cut a given DNA at a specific sequence. I sent my business proposal to a few big venture capital companies in the country. I received initial funding from Mayban Ventures, which was used for founding Vivantis. About 2 years later, I got another round of investment from MTDC (Malaysian Technology Development Corporation). Vivantis has also received BioNexus status from the Malaysian Bioeconomy Development Corporation.
Vivantis is producing and supplying reagents for our research customers in Malaysia as well as abroad. We have the platform technologies to screen, extract, and purify valuable enzymes and compounds from bacteria for further development into useful end products. Basically, we specialize in the production of restriction enzymes, nucleic acid (DNA/RNA) extraction kits, DNA/RNA amplification reagents, and other related products for molecular biology research.
Reszon Diagnostics was established in 2010 as an IVD company for developing, manufacturing, and marketing IVD tests. The main focus of Reszon is the development of innovative immunodiagnostics including lateral flow-based rapid tests and ELISA kits.
SA, AcuBiz: Please give an overview of Vivantis and Reszon’s activities in the IVD market and the reasons for your decision to add COVID-19 tests within your product portfolio.
Mr. EL Law: Originally, Vivantis was a research-based company and its products were intended for research use only. Our focus changed this year, as Vivantis entered into the IVD market with Viral Nucleic Acid Extraction Kit and Real-time PCR-based tests for COVID-19 testing.
In fact, we were already supplying reagents for COVID-19 testing since early 2020, when the first few cases were being reported in Malaysia. We offer GF-1 Viral Nucleic Extraction Kit for purification of viral RNA from various clinical samples including serum, plasma, nasopharyngeal swabs, etc. So, when COVID-19 hit we already had the products required for the preparation of the viral extraction kit. We also produce many other enzymes and reagents for life sciences research. The only thing that we needed to do was to put everything together and develop a kit for testing the clinical samples. Our main goal was to prepare testing kits that are effective, viable, and durable. So, it was easy for us to upgrade our products into IVD kits. I could say that we are lucky that we could do all this within such a short period of time.
SA, AcuBiz: What are the COVID-19 tests offered by Vivantis and Reszon? Which are the countries where these tests are currently available?
Mr. EL Law: Vivantis offers a real-time PCR-based molecular diagnostic test, ViPrimePLUS 2019-nCoV Multiplex RT-qPCR Kit for COVID-19 testing. This is a Taqman probe-based real-time PCR assay for the detection of the 2019-nCoV genome in clinical samples. It targets the N, RdRP, and E genes of the SARS-CoV-2 virus. We have been focusing on meeting all the ISO requirements and getting the registration done for our PCR test in many countries.
Reszon Diagnostics offers Reszon COVID-19 Rapid Antibody test. This rapid IgG/IgM Test is an immunochromatographic assay designed for the qualitative detection and differentiation of specific IgM and IgG antibodies to SARS-CoV-2 in human serum, plasma, and whole blood. It can offer results within 15 – 20 minutes.
Currently, we are developing a rapid antigen test for COVID-19. We expect to launch the test soon, either in August or early September. We intend to sell it outside Malaysia too, and the availability in those countries will depend upon the time to complete the registration requirements in each country. Malaysia has already approved the use of rapid antigen test kits for COVID-19 testing and currently procures the tests from South Korea. Though these tests will give results faster, the low sensitivity of rapid antigen tests is a concern.
In Malaysia, our first response to the pandemic was by supplying our GF-1 Viral Nucleic Acid Extraction Kit. In April, we gained recognition for playing an essential role in assisting the medical and health authorities in Malaysia with the immediate supply of RNA extraction kits to use in COVID-19 testing. We plan to move into offering testing services soon, by opening our laboratories across Malaysia.
We are also offering our rapid tests to diagnostic companies in countries like India and Germany on OEM basis.
From the supply point of view, China and South Korea have emerged as the leading suppliers of COVID-19 tests. We are currently offering COVID-19 testing products to European companies, China, India, Pakistan, Bangladesh, and Indonesia.
In India, there is an increasing demand for the test kits as the local players are not able to meet the rising demand. Many foreign suppliers are already active in the Indian market. We are currently in the process of registering our test kits in India, while we are already supplying our products in Pakistan and the Bangladesh markets.
We are strategizing our entry to the USA market through the emergency use authorisation (EUA) route of the US FDA. There is a very high demand for these tests in the USA, which is in the range of 1 million tests or more per day. We already have a distributor in the USA. We hope to export our COVID-19 rapid tests to the USA market, soon. In addition, China is an important market for us for our viral nucleic acid extraction kits.
SA, AcuBiz: What is your opinion on the supply and demand situation for COVID-19 tests in Malaysia? Are Malaysian companies meeting the demand?
Mr. EL Law: The demand is big and growing in Malaysia and most suppliers of COVID-19 tests have been struggling to meet the demand. In fact, only a few companies in Malaysia are fully integrated diagnostic companies, which are capable of developing, manufacturing, and selling their own kits. There may be only 1 – 2 such companies, in addition to Vivantis. Most of the other IVD companies are buying kits from China or Korea. Often, these are bought from the OEM companies for re-packaging and selling to the local hospitals and to the distributors in Malaysia as well as other countries. We probably could be the first company in Malaysia, which is fully integrated with capabilities to cover all the steps from making the test components to marketing the end products. We supply our reagents to other diagnostics companies as well.
Globally, most of the suppliers are overwhelmed by the sudden increase in demand worldwide. Flight cancellations had a strong impact on the established supply chains, resulting in long delays. The cost also increased significantly. I think now it is getting better as the international flight boardings are going back to normal. So, Malaysia can now buy the kits from overseas to meet the demand.
SA, AcuBiz: Many rapid tests for antibody as well as antigen are entering the market, lately. Do you think this will impact the demand for the PCR tests for COVID-19?
Mr. EL Law: There is a decline in the demand for PCR tests, as some percentage of the demand is being replaced by antibody and antigen tests. Cost is a major concern for PCR tests. Countries like India and Indonesia with a high population cannot afford to carry out PCR tests on everyone. Moreover, the tests may have to be repeated a few times, since accurate diagnosis depends upon the stage of infection. So, there is a demand for tests that can give the results within a shorter period of time than PCR tests.
For example, when international flights are allowed, and people are coming back to their home countries, the authorities will have to depend upon a quick test before releasing them. In such cases, rapid tests are preferred by the authorities, even though test results will depend upon the stage of infection. The current approach is to take the swab and immediately release the person with quarantine restrictions. The swab is later analysed in the laboratory. In the case of people who are traveling, if the antigen test is done on the second day after they enter the country, screening tests are done using antibody rapid tests. Follow-up confirmation tests are done using real-time PCR tests after the quarantine period.
SA, AcuBiz: What is your manufacturing capacity for COVID-19 tests?
Mr. EL Law: Currently we have 2 production facilities. One facility is producing a couple of million tests per month. We have invested in a new manufacturing facility now. Once completed, we will be able to produce about 30 million tests per month in this new facility. One-third of this capacity will be for PCR tests and the remaining would be for rapid antigen and antibody tests.
SA, AcuBiz: That is great. I have noticed a few other IVD companies are also investing in expanding their production capacity. Do you think these investments will give them the returns expected? What are your views about the demand for COVID-19 testing in APAC in the coming months?
Mr. EL Law: In terms of controlling the pandemic, many countries have been able to control the infection rates through social distancing and periodic lockdown. There is an expectation that once the vaccine is available, the disease can be controlled. Many companies are working on vaccine development. We still don’t know, even if the vaccine is out by the end of September, what will be its effectiveness and what will be the period of protective immunity one can gain.
Moreover, we are still learning about SARS-CoV-2. Like the HIV virus, this virus will probably stay with us. If we learn to live with it, testing would become an important measure since diagnosing the infection early and implementing appropriate social distancing measures would become a way of life for us. So, the demand for testing can increase globally.
Based on these assumptions, many COVID-19 test suppliers are currently increasing their capacities anticipating a growth in the demand for these tests for a long period. Another important development during the past 6-7 months is the impact other IVD segments are facing since COVDI-19 testing is the top priority in the market. Many COVID-19 test suppliers – including those in Korea and China – have stopped the production of other diagnostic kits and are mainly focusing on COVID-19 test kits to meet the unprecedented demand. This has happened by stopping the production of other rapid tests as well as molecular tests for other critical diseases. This will impact the availability of tests for many diseases. Hence, production capacity expansion is a strategic response to balance the growing demand for COVID-19 tests with the need for tests for other critical diseases.
With respect to the return on investments (ROI) for COVID-19 test production capacity expansion, I think the demand for all categories of COVID tests currently being used – PCR, rapid antigen as well as rapid antibody tests – will increase.