COVID: The Great Saliva Rotation

Published on August 24, 2020

A steady drum beat of news reports of potential COVID vaccine and therapeutic treatments has kept investors guessing as to the timing of “the great equity market rotation,” where virus battered sectors such as travel, entertainment, hospitality and financial firms finally catch up, either on a relative or absolute basis, to the high-flying, “stay at home” mega-tech names that have represented the singular most powerful investment theme of 2020.

But we suspect advances in fast, cheap, and reliable COVID testing – including, in particular, saliva-based tests — could present a more near-term, if not slightly more pedestrian, breakthrough in the hoped-for return to some semblance of “normal” social and economic activity than the critical race for therapeutics and vaccines.

To get an objective overview of the science and potential behind these saliva tests, we asked Dr. Sarah Zaidi, who has contributed her expertise on epidemiological issues to SGH Macro Advisors through the course of this crisis, for her quick thoughts last week. We share those brief comments with you below.

As a reminder, these are the views solely of Dr. Zaidi, generously simplified for us to layman level. They are not produced by SGH research, are for informational purposes only, and do not represent investment advice:


Saliva-based Testing: Game Changer

There is clear need for a reliable, non-invasive, and easy-to-perform test for the COVID-19 pandemic, which has disrupted people’s lives and the global economy through most of 2020. Saliva-based testing is showing itself as a promising testing alternative and could be a game changer for bringing the virus under better control before having a vaccine fully in place.

The gold standard for diagnosing COVID-19 is the nasopharyngeal swab (NPS) method using the real time RT-PCR detection. It is expensive to perform this test and all types of material inputs including nasal swabs, personal protective equipment, reagents, and laboratories are required. In saliva-based testing many of these components are not needed, and an individual can eventually self-administer the test.

The results of NPS and saliva-based testing are similar in terms of diagnostic accuracy. In a review of all currently available studies (meta-analysis) comparing NPS to saliva-based diagnostics, the accuracy was 91% (CI 80-99%) for saliva tests and 98% (CI 89-100%) for NPS tests in previously confirmed COVID-19 patients. Since the CI (Confidence Intervals) overlap, these results show that saliva tests are broadly speaking as accurate in detecting the virus as NPS tests.

On August 8, the FDA authorized a fifth saliva test for COVID-19 (earlier four tests yielded varying results). Developed by researchers at the Yale School of Public Health—SalivaDirect has a >94% agreement with NPS testing. SalivaDirect appears to be flexible in use, inexpensive ($1.29-$4.37 per sample), and is validated for use with products from multiple vendors, addressing supply chain bottlenecks of the RT-PCR tests. The National Basketball Association, who also provided funds for the research, is currently using SalivaDirect.

Other companies are also producing saliva-based tests. Sorrento Therapeutics is producing a saliva-based test developed by fertility researchers at Columbia University that will have results available in less than 30 minutes. COVI-TRACE is a single-step test that will require no laboratory equipment. An individual will deposit saliva into a vial then apply a little heat, after which enzymes and reagents react to the presence of the virus and change color from red to yellow to show positive results.

Among RNA viruses, the use of saliva for diagnosis has been seen for the Zika and the Ebola virus, as well as for a few SARS-infected cases from 2002-2003. The technology is not new, but it has many advantages. Saliva-based tests are many, the process is much less invasive and can be carried out by the individual, they require fewer material inputs (just a sterile container or reagents), are cheaper to produce, and take less time to diagnose. This flexibility will be critical in launching widespread COVID-19 testing and in getting a handle on the pandemic, even before a vaccine.

Prepared by Dr. Sarah Zaidi for SGH Macro Advisors


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