Date: Jul 17, 2018 Author: Jeremy Fugleberg Source: Sioux Falls Argus Leader (
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At first glance, they just look like plain old cows. They're white with black spots, lazily chewing inside a barn.
But these cows hold not just the future for a Sioux Falls-based biotechnology company, they are made to save lives.
SAB Biotherapeutics has developed these cows to be special. They are genetically engineered clones. SAB built them to essentially serve as four-legged, large-scale factories of human antibodies -- proteins that can be injected into people to give them an edge against diseases and infections.
And here they are, standing in SAB Biotherapeutics' new 80-acre facility outside Canton, looking like they don't have a care in the world.
More: Biotech firm SAB Biotherapeutics expands with Canton operation
"These are pretty happy, content animals," said Eddie Sullivan, president, CEO and co-founder of SAB Biotherapeutics. "And they don't know they produce human antibodies. They're pretty good with it if they do know."
SAB Biotherapeutics was founded in 2014 and was formerly known as Hematech. It's a pillar in the South Dakota biotech community, with an expanding footprint in South Dakota as it develops its products and moves them toward the market.
The company is based out of offices and lab space in the Sanford Research facility in Sioux Falls (Sanford has a minority stake in the company). It's now wrapping up the first phase of construction on its Canton facility and is slated to be an anchor tenant in the new University of South Dakota Discovery District in northwest Sioux Falls.
And the company is doing groundbreaking work that is showcasing South Dakota as no biotech backwater.
"This is not an exaggeration," Sullivan said. "In my opinion, this is the most complex genetic engineering project that has ever been accomplished anywhere, and it was done here in Sioux Falls, South Dakota."
Eddie Sullivan, president and CEO of SAB Biotherapeutics,
Eddie Sullivan, president and CEO of SAB Biotherapeutics, outside the company's facilities housed in Sanford Research in Sioux Falls. (Photo: Jeremy Fugleberg / Sioux Falls Business Journal)
SAB's core innovation was a 'big big challenge'
SAB's magic trick of science is to figure out how to create a cow that would develop a large amount of human antibodies. It's taken years of research, of trial and error.
"We can transfer the human antibody genes into the animals, but to have them function in such a way that they would produce antibodies as the same physiological levels as the cows normally do so that the cows are healthy, was a big, big challenge," Sullivan said. "So we had to do engineering within those genes to facilitate the production of the human antibodies at levels that were similar to what cows would produce naturally."
The cattle are vaccinated against a targeted disease, and they then produce human antibodies to fight the disease. The cows' plasma is collected, the human antibodies harvested from the plasma and then purified to isolate the proteins.
Other companies have figured out how to harvest antibodies from smaller animals for use in humans. SAB was the first to produce fully human antibodies in large animals.
Some of the first animals produced by SAB in the early 2000s only produced a small amount of human antibodies -- not enough to be profitable but a good proof of concept. The company kept working, and decided to move to Sioux Falls. Previously the company had a lab in Massachusetts, was making embryos in Kansas and was primarily working with cattle in Iowa.
SAB bet on its observations that South Dakota provided a welcoming business climate, access to local and state government leaders and a sound base to attract talent to its work.
"I think we were right," Sullivan said.
Cows at SAB Biotherapeutics's facility in Canton. The
Cows at SAB Biotherapeutics's facility in Canton. The spotted one on the left is part of SAB's herd of cloned cows capable of replicating large amounts of human antibodies. (Photo: Jeremy Fugleberg / Sioux Falls Business Journal)
Inside the SAB's 'pharm' near Canton
SAB's Canton facility was just finishing up construction when the Sioux Falls Business Journal visited in late June.
Some early residents, both cloned cows and sentinel cows meant to serve as early warning of herd problems, already called the facility home. But workers were hard at work finishing up the front office and birthing and housing facilities.
"Our first babies will be born here in about a week, that will be actually born on this farm," Sullivan said as he showed off the facility.
Genetically engineered embryos are implanted in and taken to term by mother cows who are genetically distinct. The babies are then removed via Ceasearan section at the Canton facility.
"We do that because they are immediately separated from the mother cow as a disease barrier for this production group," Sullivan said. "We consider this to be a closed production herd."
The cows are clones. They're all identical twins. And they're all females, because females produce more antibodies, Sullivan said.
The first phase of the Canton facility, or "pharm," includes a four-building, climate-controlled complex meant to hold and house 40 animals and a front office. Future phases would expand the facility even more, to hold up to 500 cows.
The Canton facility consolidates SAB operations by relocating its transgenic cattle formerly housed at Trans Ova Genetics in Sioux City, Iowa, and centralizing its plasma collection, veterinary care, feed and equipment storage and offices. The facility will also move the production herd much closer to SAB's headquarters, labs and production in Sioux Falls.
Part of the SAB Biotherapeutics labs inside the Sanford
Part of the SAB Biotherapeutics labs inside the Sanford Research facility in Sioux Falls. (Photo: Jeremy Fugleberg / Sioux Falls Business Journal)
Revenue plans center on keeping manufacturing rights
SAB Biotherapeutics goal is not to move its cow-produced human antibodies to the market and then hire sales people to hawk their products. The company is now conducting clinical trials, a milestone in its development. But there's plenty more work to be done.
"It takes close to a decade once a product is identified to take it all the way to (Food and Drug Administration) licensure, so for a company like ours, that is not the commercial end point of our company," Sullivan said.
The company has developed its research into products now in clinical trials, with the hope that a large pharmaceutical or biotechnology will license the marketing rights to the company's products. The large pharma or biotech company would then move the products into late-stage clinical studies and the market, all while SAB builds its operations in Sioux Falls.
"We will maintain the manufacturing rights, so we will manufacture the products here because of the unique manufacturing system that we have," Sullivan said.
Royalties and other funding mechanisms are also possibilities.
Discovery anchor tenant status means collaboration, milestone
SAB's commitment to become an anchor tenant of the USD Discovery District means it will move its labs to the innovation park and build manufacturing capacity on-site -- a key part of SAB's growth plan.
The Discovery District location also puts SAB in close proximity to research and university facilities, increasing collaboration opportunities.The 80-acre planned corporate and academic research park is adjacent to University Center in Sioux Falls.
SAB will move its headquarters to the first building planned for the $30.9 project: a 84,000-square-foot multi-tenant research lab, office and biopharmaceutical manufacturing space, that will also include other tenants including fellow anchor tenant Alumend. The second planned building: SAB's 42,000-square-foot commerical biomanufacturing production facility.
The Discovery Districts fulfills a need identified by biotech leaders in the state: a lack of facility space. But it leverages a strength: biotech expertise and an available workforce produced by the state's universities.
Sullivan helped found the South Dakota Biotech Association in 2006, when the state's biotech sector wasn't nearly what it is now.
"We had a vision for what South Dakota would become, and I would tell you, 12 years later, we can say that vision is happening," he said. "Across the state of South Dakota, we're finding that science -- and I'm talking world class science -- can happen right here."
