Diagnostic device company Advanced Animal Diagnostics has secured $11 million in a series B round of equity financing that the company will pour into continued research and development of a detection tool for mastitis in dairy cows.
The round was led by Durham, North Carolina venture capital firm Intersouth Partners and included participation from Novartis Venture Funds as well as other private investors. Durham-based Advanced Animal Diagnostics, or AAD, is developing a diagnostic test for mastitis, an infection of the cow’s udder caused by bacterial infection. The global dairy industry loses billions of dollars each year due to the disease. AAD President Joy Parr Drach said the new financing should take the company all the way to commercialization of its first product.
“We’ll have a test on the market in less than a year and a half,” she said.
AAD is based on technology originally developed at medical technology company BD (NYSE:BDX). AAD Chief Scientific Officer Rudy Rodriguez, former vice president of R&D for BD’s primary care diagnostics division, was the BD project leader of the team that developed the core technology that is the basis for AAD. The company was spun out of BD’s in-house incubator. While AAD’s core technology has applications in human diagnostics, AAD chose to focus on animal diagnostics, which is an underserved market and offers a quicker path to commercialization. While mastitis is AAD’s current focus, Drach said the technology is a platform that the company will eventually develop into tests diagnosing disease in other farm animals.
AAD has not received all of the $11 million from the round, yet. A securities filing dated March 14 shows the company has raised $5.7 million. Drach said that the filing represents just the first tranche of the $11.3 million round. The company will use the money to hire for positions in production and manufacturing, and also to conduct on-farm economic trials of its first product line. These trials will demonstrate the impact of the AAD test on farm economics and milk quality. The company is currently looking for farms to participate in those trials.
AAD was founded in 2001 and funded by a U.S. Department of Agriculture Small Business Innovation Research grant. The company was also supported by funds from the North Carolina Biotechnology Center and the North Carolina State University College of Veterinary Medicine. Prior to the announcement of the series B round, AAD had raised $1.1 million in a 2009 series A round from BD and angel investors.