A Texas Tycoon Throws Millions at the Covid Testing Puzzle

NEW BRAUNFELS, Texas—A hotly debated attempt to solve America’s coronavirus testing shortage began with a sick, frustrated billionaire at home in a leafy Texas Hill Country town north of San Antonio.

Graham Weston, co-founder of cloud-computing company Rackspace Hosting Inc., owns a pair of homes in New Braunfels. When the pandemic hit in March, he flew his son back from studying in the U.K. and quarantined him in a spare riverside ranch house.

It didn’t work. Though Mr. Weston’s son showed no symptoms, he was carrying the virus; he gave it to his father at the airport pickup, the family suspects. Mr. Weston fell so ill he thought he would die.

Since then, he has been on a crusade to persuade high-level politicians, teachers and fellow business leaders that the key to reopening schools and the economy is to test people who don’t appear to be sick.

“It’s like looking for a needle in a haystack, except the needle is a match,” Mr. Weston says.

The 56-year-old, despite having no background in science, is part of a giant, real-time experiment to test asymptomatic people. The concept is fraught and has drawn a wealth of detractors who say precious testing capacity should be reserved for individuals with virus symptoms. Yet a growing number of public-health experts and fellow billionaires are backing Mr. Weston’s entrepreneurial approach to accelerate a return to anything close to normalcy in American life.

Today a school district just outside San Antonio will begin weekly testing of all its 4,000-plus students using a $2.5 million nonprofit lab Mr. Weston helped bankroll. It is the largest effort for schoolchildren in America to go operational.

Mr. Weston eventually hopes to expand the facility to test every student between kindergarten and 12th grade in San Antonio, the country’s seventh-largest city. Texas Gov. Greg Abbott, a Republican, has been calling Mr. Weston on his cellphone for frequent updates. Mr. Abbott says he envisions dozens of such labs around the state testing school children—if the early results are promising.

The effort puts Mr. Weston, an occasional Republican donor, at the center of a public-health rift. On the one hand, many epidemiologists and other health-care experts say that in an ideal world there would be no limit to testing if the coronavirus is to be contained. The Centers for Disease Control and Prevention estimates that 40% of people who get infected show no symptoms and can unwittingly spread the disease. With this in mind, the White House regularly tests staffers who come into contact with President Trump.

On the other hand, in the real world there are supply constraints, including lab space and access to chemicals and other testing material—and the money to pay for it all. That has tipped the argument toward limited testing, just as a scarcity of masks early on colored official guidance about whether the general public should wear them.

The Trump administration has delivered mixed messages. The president has said he thinks testing is overrated and blamed its widespread use for inflating U.S. coronavirus statistics. The CDC has flip flopped, initially recommending everybody get tested, then last month saying that people who appear healthy “do not necessarily need a test,” and finally last week revising the directive to say that asymptomatic people should be tested if they have been exposed to someone who has the virus.

Mr. Weston wants to show that general testing is viable. His effort is roughly based on one pioneered by Stacey Gabriel, a Boston geneticist, and is rooted in a shared conviction that testing can be performed at scale, outside existing commercial and governmental infrastructure.

The tests will be run with off-the-rack equipment, including mass-produced plastic tubes used in traditional blood tests, which Mr. Weston and his team found by calling around to pharmaceutical companies. The cost is about $35 per test, roughly 15% of what major commercial laboratories can charge, including the cost for medical professionals collecting samples.

These molecular tests, commonly called PCR tests, search for the virus’s genetic material and are seen as the gold standard in accuracy. They catch the virus in its earliest days.

Mr. Weston’s team says their cost savings come from using generic equipment, such as mass-produced swabs that go for a few cents each, rather than custom orders.

Dr. Gabriel used similar techniques this summer to turn her Massachusetts Institute of Technology-affiliated laboratory into a coronavirus testing facility for more than 100 Northeastern colleges and universities.

“It’s not hard,” says Dr. Gabriel says, who normally focuses on sequencing the human genome.

Part of the struggle is to get on the radar of hospitals and other providers that have long-term contracts with big laboratories, such as Quest Diagnostics. A Quest spokeswoman said the company has performed more diagnostic tests than any other provider during the crisis, at “competitive” rates.

Dr. Gabriel is a member of “Scientists to Stop Covid-19,” a group of researchers pursuing a “Manhattan Project” to combat the pandemic, as The Wall Street Journal earlier reported.

Mr. Weston hopes to prove that her laboratory can be replicated nationwide. He has opened up his Rolodex to line up other financiers to fund similar labs in their own hometowns. Russ Ramsey, a Washington, D.C., financier and former head of that city’s Olympics effort, is lining up money for a facility that will test students, as well as regional employees of companies such as Deloitte and Amazon.com Inc. as soon as next month in the Washington area.

The Professional Golf Association is watching too, with an eye toward possibly testing fans and competitors at events as soon as early next year, an executive says.

Mr. Weston has been surprised by the reluctance of Texas institutions to join in. The state’s largest medical school, University of Texas Southwestern in Dallas, told his team they had other plans. A university spokesman described the conversations as “a listening session.”

Fellow technology billionaire Michael Dell separately turned down entreaties to help fund a facility in Austin, people briefed say.

“I’ve watched all the naysayers slam all the doors in their faces,” says Dallas investor Joe Colonnetta, who is connecting Mr. Weston with policy makers nationwide. “The main innovation here is that they have the courage to try.”

At the start of the pandemic, the question was how, not whether, to test. The CDC shipped its first testing kits to local governments in early February. While those early efforts were flawed by accuracy and manufacturing stumbles, few disagreed on the need to expand the system. Manufacturers rolled out not just hypersensitive PCR tests but antibody tests that purported to measure, via blood draw, whether a now-healthy person was previously infected.

By June, some of the country’s most prominent doctors were calling for the country to conduct at least six million tests a week to better isolate infected people.

The seven-day average of new daily Covid-19 tests completed in the U.S. was 854,000 as of Monday, only modestly up over the past month.

Many government-run testing centers won’t test children at all. Major public school districts like New York City and San Francisco have repeatedly pushed back restart dates, citing uncertainty about the virus.

The lack of testing frustrated Mr. Weston, who now runs a startup incubator near a downtown San Antonio office tower that bears his name. Gun-shy because of his prior infection, he asked all his 77 employees to get tested before they returned to the office in August. Three came back positive for Covid-19 and were sent to quarantine. Mr. Weston suspects they would have infected many others at his company if he hadn’t known.

That set him off on a path to find broad, regular testing. The “Manhattan Project” group spent dozens of hours talking to elected officials in Wyoming about setting up regular testing for the entire state, but the idea was sidelined after a call with Gov. Mark Gordon, a Republican, people on the call say.

Mr. Gordon told the group that 30% of Wyoming residents were against vaccinations, and couldn’t be convinced of the need to be tested without symptoms, according to people on the call. A spokesman for the governor said conversations continue “to explore if a future collaboration is possible.”

“We’ve talked to decision makers in almost every state, most of Congress and the White House,” says Dr. Tom Cahill, organizer of the scientist group, of expanding testing. “They all say they want to do it, but no one wants to be the first one.”

Over barbecue brisket on a recent sweltering evening at the same house where his son was quarantined, Mr. Weston professed little faith in the institutions that have led America’s efforts so far: “All the greatest minds at the CDC had years upon years and billions of dollars to prepare for this, and what they came up with was: Wear a mask?”

The regulatory infrastructure, both state and federal, isn’t designed for regular, nationwide testing of hundreds of millions of Americans. Under many state health directives, only a health-care professional may perform the nasal swab, even though, in Dr. Gabriel’s case, the swab is only entering an inch or two into the nose. Hers is the so-called shallow test, not the “deep brain” one, though the accuracy is roughly equal, she says.

Dr. Gabriel’s laboratory is now performing 65,000 tests a day for about 100 Northeastern colleges and universities. She does it for around $25 each.

George Washington University’s public-health dean, Dr. Lynn Goldman, built a lab following a similar model but faced internal resistance. She is now sitting on excess capacity, with more tests available than patients waiting for them. While she is screening hundreds of asymptomatic collegiate athletes and undergraduate students a week, the university elected to have most students stay home this semester, rather than be tested regularly in person.

The school’s dean of medicine, Dr. Barbara Bass, says she doesn’t believe doctors, patients or medical students need regular testing. Masks and other personal protective equipment are enough, she says.

“We don’t do it, because it’s not necessary,” Dr. Bass says. “Maybe we will figure out later it was the right answer, or maybe we will figure out it was a massive waste of resources.”

In San Antonio, Mr. Weston’s experiment is close to the proving point.

Though he hoped to be operational at the start of this school year, hiccups arose. He linked up with a local laboratory, Biobridge Global, which acquired equipment sitting idle in warehouses across the country. They wound up designing a system reliant on what they call “plug and play” machines, like the $200,000 Hamilton Microlab STAR, a robot that automates moving samples from tubes en mass.

They say it was easier for them to amass supplies like reagents because they designed a process that worked with multiple, generic alternatives, unlike some commercial laboratories. The Food and Drug Administration in July validated supply alternatives for certain scarce testing components. “It’s an open format and an open platform,” says Scott Jones, Biobridge’s vice president of scientific affairs.

The team also found a workaround to the requirement for a doctor to order every test. Under emergency order from the Texas commissioner of health, every state citizen is considered having been prescribed a test during the pandemic. Because the center will be testing only asymptomatic people, it is being pitched as one that only screens for Covid, rather than diagnoses it formally.

Still, regulatory approval has run long. Mr. Weston hoped to be ready by Labor Day, but the team discovered early this month that they hadn’t tested enough known positive samples to get FDA laboratory clearance. The group’s CEO considered posting on Facebook to hunt for coronavirus patients, before scrounging up enough Covid-positive samples from the local University of Texas hospital system.

After calling around, Mr. Weston found a school district south of the city, Somerset Independent School District, ready to take a leap of faith. Superintendent Saul Hinojosa says the solution comes at a dire time: Just 35% of the district’s students showed up in the first week of classes. Many of their parents work as day laborers or at a local Toyota factory.

Local foundations connected to Mr. Weston are picking up the bill. Gov. Abbott says he plans to use federal funding on the initiative, too.

Mr. Hinojosa plans to test every student and staffer every week, with parental permission, mostly in the cafeteria or gymnasium. At-home instruction will be mandated for anyone who comes back positive. Students who refuse to be tested will be barred from after-school activities.

Sen. Bill Cassidy, Republican of Louisiana, says he favors the mandate, and is hoping to apply Mr. Weston’s approach in his own state. “One person’s liberty to be tested or not does not extend to potentially exposing others to disease,” says Sen. Cassidy, a physician.

Though Mr. Weston has some prominent support in San Antonio—including from the county judge, a Democrat and the region’s highest elected official—he hasn’t yet cracked the main school district in his hometown.

San Antonio’s medical director said in a late-August town hall that she didn’t favor testing asymptomatic students, citing CDC guidance and potential cost. The school board, too, will have to give its assent.

Who will get them all to change their minds? “I will,” says Mr. Weston.

Write to Rob Copeland at [email protected]