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Fulgent Genetics, Aegis Sciences Win CDC Contracts for SARS-CoV-2 Surveillance

NEW YORK – Commercial diagnostic lab Fulgent Genetics announced Monday it has been awarded a competitive contract from the US Centers for Disease Control and Prevention to sequence SARS-CoV-2 virus. Separately, Aegis Sciences announced Tuesday it has also won a CDC contract.

Under its agreement, Temple City, California-based Fulgent will sequence the genomes of random samples that have tested positive for SARS-CoV-2 by PCR. The CDC contract has an initial term worth approximately $24 million, with the opportunity to increase to $47 million, according to a Fulgent spokesperson.

Fulgent was selected as a partner due to its access to samples, lab capabilities for processing and next-generation sequencing, ability to manage a significant amount of data, and ability to deliver data to the CDC under its strict specifications, the firm said in a statement.

"We are pleased to be able to leverage our NGS capabilities to aid the CDC in the study of SARS-CoV-2," said Harry Gao, Fulgent's chief scientific officer. "We believe that a thorough understanding of the genomic data of the virus gathered through this study will improve our collective ability to fight COVID-19 over the long term."

The CDC contract to Aegis, for an undisclosed amount, will support the Nashville, Tennessee-based firm's sequencing of samples from its national testing program.

Aegis' diagnostics program includes a collaboration with Walgreens to perform COVID-19 testing for over 3,000 of its pharmacy locations.

Aegis will perform NGS analysis of de-identified positive samples from all 50 states and Puerto Rico to assist in identifying regional and national transmission of variants of concern, the firm said in a statement. 

"This initiative, coupled with our significant COVID-19 testing relationship with Walgreens, will enhance efforts to more effectively manage the pandemic," said Frank Basile, CEO of Aegis. 

Aegis said that it has now begun testing under its initial agreement with CDC. "We are presently working on a longer form agreement but can't discuss the specifics at this point," the firm commented through a spokesperson.

The contracts are effectively a second tranche of funding from the CDC that was initially described as supporting sequencing of up to 6,000 viromes per week at commercial diagnostic labs.

The Biden administration announced in February that CDC will now invest almost $200 million to expand SARS-CoV-2 genomic sequencing and detect emerging variants, increasing from roughly 7,000 samples per week to about 25,000 per week.

In a note to investors, Steven Mah and his team at investment bank Piper Sandler noted that Fulgent's contract is the largest sequencing contract awarded by the CDC to date. Previously announced contracts to Illumina and Helix labs, Quest Diagnostics, and Laboratory Corporation of America (Labcorp), were each in the $5 million range, Mah and colleagues said.