Biotech startup, Palladium Diagnostics moves from San Diego to New Mexico’s Borderplex

While San Diego is renowned as a biotech hub, Palladium Diagnostics believes that Southern New Mexico’s largest city has just as much, if not more, to offer. The company was founded by Jeff and Nolan Bauer, a father-son duo, in late 2021. Jeff Bauer serves as Palladium’s president and CEO, with his son Nolan as the vice president of research and product development. Kevin Jones, the company’s chief technology officer, completes the core team.

This trio boasts an extensive history in the field of biosciences, particularly in the development and manufacturing of rapid diagnostic tests, such as pregnancy tests or tests for Covid-19. Jeff Bauer previously founded DCN Diagnostics in the early 2000s and later launched Kestrel BioSciences, primarily based in Thailand. In 2012, they moved from Thailand to San Diego to establish Kestrel’s operations in the U.S. Subsequently, Kestrel was acquired by Planet Innovation, an Australian health-tech innovation and manufacturing company, and rebranded as Lumos Diagnostics. Lumos merged with RPS Diagnostics in 2019 and went public on the Australian Securities Exchange in the summer of 2021. A few months after this, Jeff and Nolan Bauer left the conglomerate of over 200 people.

Palladium Diagnostics initially launched in Florida to tap into the post-Covid market. However, Jeff Bauer’s return to Thailand prompted Nolan to relocate the newly established startup to San Diego, where most of their family resided. At that time, the company had three employees in San Diego, but this would not be their permanent location.

The decision to move to New Mexico’s Borderplex was driven by the high cost of living and the need for suitable lab space in San Diego. The Bauers started considering the move in September of the previous year, and their connection with Las Cruces was established through Nolan’s former father-in-law, who had ties to New Mexico State University (NMSU). This connection led them to the Mesilla Valley Economic Development Alliance (MVEDA), an organization that assists companies in relocating to or expanding within the Southern New Mexico “Borderplex” region.

MVEDA introduced Palladium to Wayne Savage, the executive director of Las Cruces’ Arrowhead Park, a planned technology and office development located south of NMSU’s campus. Following a phone interview with Savage, the startup visited NMSU’s Arrowhead Center in January of this year, and one month later, Palladium officially settled in Las Cruces.

The move to Las Cruces was a long-held aspiration for Nolan Bauer, who believed that Southern New Mexico offered great potential for biotech growth, given the presence of New Mexico State University and its abundant resources. Cost savings and fully equipped lab space were key factors that influenced Palladium’s decision to establish itself in Las Cruces.

Palladium currently rents approximately 1,100 square feet of lab space and 400 square feet of office space at the Arrowhead Center, paying around $2,100 per month, which includes all utilities and resources like hazardous waste disposal. This setup eliminated the need for extensive retrofitting, providing an ideal environment for the startup’s operations.

The Arrowhead Center also provided Palladium with valuable connections and resources, including collaboration opportunities with other New Mexico-based companies and organizations. Palladium has partnered with NMBio, an organization focused on accelerating bioscience company growth in the state. Additionally, the startup has utilized NM FAST, a program run by the Arrowhead Center, to aid in federal grant applications.

In addition to Palladium Diagnostics, the Bauer family and their colleagues have initiated Acadia DNA, a service-based company specializing in paternity testing. While in its early stages, Acadia DNA aims to secure initial funding to generate consistent revenue between contract cycles.

Palladium’s future plans include expanding its manufacturing capabilities, which could lead to a significant increase in staffing. While currently focused on contract-based research and development, the startup is poised to enter manufacturing to create job opportunities in Las Cruces. Palladium is in the final stages of a manufacturing contract, with the potential to produce between one to two million diagnostic tests annually, resulting in a substantial revenue boost.

This expansion would necessitate the hiring of 10 to 15 employees, encompassing lab and manufacturing technicians, a manufacturing manager, and administrative staff. The startup plans to begin recruitment in the coming months.

Furthermore, Palladium intends to take over an adjacent 800-square-foot space within the Arrowhead Center. If the company continues to grow, it may explore additional space options outside the Center while maintaining a presence there.

Palladium’s partnership with NMSU is expected to assist in filling positions, particularly for high-skilled quality assurance roles. The startup believes that being in proximity to the university provides a valuable advantage, as it can tap into the university’s talent pool to support its growth and development initiatives.

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New Mexico INNO