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Silicon Valley steps in to save the bacon—literally

Friday, 9 Aug 2013 | 5:22 PM ET
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Alex Huang is a mechanical and electrical engineer from Stanford who once worked for Steve Jobs. Now he's trying to keep the world's porcine population healthy.

"I'd never stepped on a farm in my life," he said. "My friends are all techies."

Partnering with a veterinarian he knows from the medical device business, Gin Wu, Huang decided a few years ago to investigate a plant-based natural water purifier. They went looking for the kind of traditional herbal remedy that humans have used for thousands of years but one that had been difficult to capture in a bottle.

"Gin and I said, 'We can do this. We're from Silicon Valley. We're problem solvers,' " Huang said.

The result they came up with may solve more problems than either originally envisioned. With $6 million in angel funding, Huang and Wu formed LiveLeaf.

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They created a water purifier from ingredients including pomegranate and green tea and tested it at Chinese pig farms. Huang said the farmers told him, "Hey, you know it works. But did you know that it stops diarrhea really well?"

When Huang asked how they knew that, the farmers told him the pigs drinking the purified water didn't have stomach problems. They then shocked him by adding, "It worked so well on our pigs, we gave it to our kids."

This year LiveLeaf brought to market its first product, called Grazix, being sold as a feed supplement to hog farmers. The timing could not have been better. A deadly virus is currently afflicting pigs in 16 states, and it's believed to have taken hold in the No. 1 pork producer in the world: China.

"It causes nearly 100 percent mortality in the younger neo-natal and suckling pigs," said Dr. Ching Ching Wu, a veterinarian who worked for years at Purdue. The so-called PED virus is not harmful to humans, but the fear is that it could kill so many pigs that pork prices would skyrocket.

Current precautions include stricter biosecurity on farms and more water, but "they really can't stop it," she said.

'Across the world ... to different animal species'

The BLT economy
Hog farmers in the U.S. and China are grappling with an intestinal virus that is almost 100 percent fatal in young pigs. CNBC's Jane Wells reports that the bug has spread to hog farms in 16 states. (Also, what Jane thinks about TripAdvisor's pizza survey.)

LiveLeaf says that Grazix stops diarrhea in a matter of hours, keeping the pigs alive long enough for their own bodies to develop an immunity to fight off the virus, all without using an antibiotic.

The next step is to bring the product to humans. Some doctors are already using a version of it on people in poorer nations.

"This could have a tremendous impact on the developing world, because diarrhea is one of the major killers," Huang said. But he also sees a huge market in the U.S. as a health supplement for consumers.

The company has started selling NatriQuell.

"I take it regularly, my friends all take it, and I'm happy to give you some," Huang said.

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It will take years of trials get approval from the Food and Drug Administration to label the product as a medical treatment, so in the meantime, it can be marketed only as a type of general health supplement. Wu, the veterinarian from Purdue, was skeptical that a couple of Silicon Valley guys had solved a problem she had been working on for years. But she has become such a believer that she joined the company as its director of animal health.

"I would like to see this application across the board, to different animal species," she said.

LiveLeaf expects to generate only $1 million to $2 million in sales this year as it begins to launch the product, but the company has high hopes.

"We're looking at about three years from now hitting the $100 million mark, so that's pretty aggressive," Huang said. "That's not going to happen by ourselves."

LifeLeaf has one distributor and is set to sign on two more. It has been approached by large companies about potential licensing deals, Huang said.

A few, though, are waiting to see if the product has traction.

"This is a whole new category. People don't quite understand what we are yet," Huang said. "If you're constantly doing what everybody else is doing in that industry, you're not going to come up with innovation."

—By CNBC's Jane Wells. Follow her on Twitter @janewells