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South Dakota wants to lure biotech companies
by Cara Hetland, Minnesota Public Radio
September 15, 2003

George and Charlie are the oldest living cloned animals. They live a quiet life on an Iowa farm. A longer gestation period meant that George and Charlie were born after Dolly the sheep. (MPR Photo/Cara Hetland)

There's a new effort to make South Dakota competitive in biotechnology. Many would say the state is about 20 years behind the times. But Gov. Mike Rounds says whether it's agricultural products or medical breakthroughs, he's ready to offer an office and financial assistance to companies willing to move. Unfortunately, many biotech companies are either well established elsewhere, or are still just someone's good idea.

Sioux Falls, S.D. — Biotech industries make Roundup Ready corn. They produce insulin for diabetics, mechanical body parts for amputees and they even clone animals. The idea is using biology and technology to make something new. For Gov. Mike Rounds, biotech means money.

"In this state, we still believe that profit is not a dirty word," Rounds says. "It means not only providing a favorable tax climate, but also providing the infrastructure to do their research and development and eventually allow their business to grow."

	Jim Robl

Rounds has pledged economic development money for a new building in Sioux Falls. It will house about a dozen start-up companies. The idea is to help a scientist with an idea and turn it into a business. The state will take care of the details. State money will provide the special requirements technology companies need, such as particular air handling or special countertops.

"If they do have to begin from scratch -- build their own building, do the design work, lay out all of their plans -- they might well fall behind someone else competing for the same type of technology," says Rounds.

One biotech company has taken South Dakota's governor up on the offer. Hematech recently received $7 million in grants and loans to build a new building. Hematech moved its research lab to Sioux Falls two years ago, to be close to cattle and to a slaughterhouse.

Hematech clones cows. But they're not ordinary cows -- they have human antibodies. And once the process is perfected, blood from the cows will be used to make medicine.

	C-section delivery

"We actually do our genetic modification in a dish with a skin cell. Once we've chosen the appropriate cell with the appropriation modification, then the trick is, how do you turn that single cell into a cow," Jim Robl, chief scientific officer, says. "We use a cloning procedure, which involves going to the slaughterhouse and collecting a bunch of ovaries, sucking the eggs out of the ovaries, and then putting the DNA from that cell into the egg. The egg turns it into an embryo and eventually into a cow."

All those cows are the same. The process removes the individual DNA, which makes the eggs identical.

Technicians sit in a dark room behind large microscopes and remove bovine DNA from each egg. The cells in each egg are stained with a flourescent dye. That's why the room needs to be dark -- because light can kill the egg. Then, human DNA is injected.

"They pull up an egg and click the shutter, and it gives a flash of light, and they locate where the DNA is. They'll click it a couple of times and have to pull it out kind of blind," Robl explains. "That's the process, and that's why you hear the clicks moving it around, so it's in the right place to go in and suck that baby out."

In this state, we still believe that profit is not a dirty word. It means not only providing a favorable tax climate, but also providing the infrastructure to do their research and development, and eventually allow their business to grow. - South Dakota Gov. Mike Rounds

The eggs are taken to an Iowa farm, where each week hundreds of embryos are implanted into surrogate cows But very few make it full term. Hematech has been at this a year, and so far it's successfully cloned only 80 cows.

Jerry Palmer, quality systems director, says when the cow is ready to deliver, the calf is born by cesarean section.

"It's actually a standing c-section. We make a midline incision between the rib and the hip bone, and take the calf out," says Palmer.

The calf is watched closely to make sure it's free of disease. For two weeks it lives in a sterile pen. Then the calf is transferred outside, and for six weeks it's in its own large plastic kennel. Palmer says they stay there for another six weeks before they are grouped in a herd.

"This way, too, the herdsman can have the opportunity to monitor them, to make sure they're drinking their water and eating feed," says Palmer. "It's kind of a monitoring system, too. If you had two or three calves in here you couldn't tell who was eating and who was drinking."

All the cows look alike. They're brown with a white spot on the face and the underbelly. Biologically, these animals are identical.

But for Hematech they're only the first step. It's the offspring of these calves the company is really interested in. Ultimately, they will manipulate the blood of those second-generation cows.

Jim Robl says each cow can be immunized with a different infectious disease, and will produce antibodies as a result. Those antibodies can be given to humans to help them fight disease.

The antibodies won't replace immunizations as we know them today like polio or chicken pox. Rather an antibody injection can help someone with a chronic disease or a defective immune system. Jim Robl says he wants Hematech's first product to be an antibody that kills staph infections.

	A cloned calf with human antibodies

"A couple of million patients a year get an infection as a result of going to the hospital. The result of the surgery is fine, but they get a staph infection. Staph is an organism that has become very resistant to antibiotic treatment," Robl says.

"So our applications would be to make antibodies that are a natural product to fight disease. So when a patient comes out of surgery we simply give them a large infusion of this antibody that protects them from this staph agent, for let's say, up to a month following surgery," says Robl. Robl says once cloning is perfected, Hematech will begin testing the antibodies for FDA approval. It'll take several years before anything is on the market, and then the options are endless. He says the cows can be injected with anthrax to produce an antibody against a possible terrorist attack. The same could be said for smallpox.

Hematech may soon be ready to start testing the antibodies from cow plasma. One sign of that is the company's new 40,000-square-foot lab. It's also hiring additional staff.

Gov. Mike Rounds says he wants businesses like Hematech in South Dakota, because he says it's a clean industry and will offer the state new, high-paying jobs. He also hopes it'll prevent younger people from leaving South Dakota when they graduate.

"In order to do that, we have to challenge them with jobs they want to hold. We think biotech holds some of that promise, and it's one step in the process of keeping those young people here," says Rounds.

"We've got the open spaces, we've got the background of animal husbandry, we've got the plant sciences and we've got a great medical community here that also participates in that. What we've got to do is blend them all together -- bring them together and bring the best of all those worlds into the concept of biotech," Rounds says.

Some economists predict biotechnology is this decade's boom industry, like the dot coms of the 1990s. But there's also caution. Biotech companies don't require a huge work force, and that makes many wonder what kind of economic impact biotech can really deliver.

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