It was just a short time ago that we questioned why we hadn’t heard more about Daktari Diagnostics. It was co-founded by former Clinton Foundation Medical Chief Bill Rodriguez, and its backers include the Gates Foundation. And it's on the brink of a relatively large-scale roll out of its HIV/AIDS point-of-care CD4 tester. Considering all that, we continue to find Daktari’s low profile a little puzzling.
On the other hand, we’re also finding that Bill Rodriguez continues to be a master at the art of raising money.
Daktari was established in 2008, and Mr. Rodriguez and company have managed to pull in $30 million since then. That number just got bigger, and Daktari is inching closer to commercializing its CD4 tester with a $15.5 million investment, thanks to a handful of funders including the Merck Global Health Innovation Fund (GHI). On a side note, the company also secured $1.2 million from the NIH for its second-stage study to develop portable diagnostics for hepatitis C.
What’s even more impressive is that given the regulatory challenges, the diagnostic and medical device industry isn’t necessarily considered prime space for investors. But in an age when impact investing is white-hot, companies like Daktari are going beyond traditional investment and venture capital firms. Merck’s Global Health Innovation Fund is a prime, non-traditional VC target.
Daktari works to create cheap, easy-to-use, point-of-care products to overcome some of the most persistent problems in global health. The company is particularly seeking global health solutions in the world’s poorest countries.
Its CD4 tester, which has garnered the funding interests of Merck GHI, is a portable, point-of-care device that measures CD4 cell counts. CD4s are white blood cells that fight infection and are also known as T-helper cells. Testing these cell counts determines a patient’s HIV stage and can also determine whether a patient needs to start antiretroviral therapy. The test can also determine if HIV/AIDS patients can fight off opportunistic co-infections such as tuberculosis. The device is battery-powered and fits in a backpack. It’s cheap, easy to use and now offers same-day results.
Daktari’s CD4 tester is basically the embodiment of projects in which Merck GHI likes to invest.
Merck GHI currently holds $500 million under management and is pretty heavily focused on investing in digital health companies. At the same time, Merck is super-selective about the companies it chooses to back, having only done so with 20 companies since 2010.