XY Inc. Wins Biotech Award

By Erin Hottenstein
The Northern Colorado Business Report

July 26, 2001

FORT COLLINS - When Dr. Mervyn Jacobson talked about the development of a commercially viable sperm sexing method, he didn't start with the launch of his company, XY Inc., in 1996.

"It's been a dream of mankind for more than 5,000 years, since man became a herder," he said. "For some situations, you want males and for some situations, you want females."

The first known artificial insemination took place in 1780, followed much later by development of flow cytometry machines in the 1970s and resulting in separating X- and Y-bearing sperm in the late 1980s.

In 1992, scientists helped produce the first sex-selected calf using in-vitro fertilization and by the mid-1990s scientists used artificial insemination.

Now, the company has developed ways to make sex selection possible on a commercial scale. XY Inc. announced the breakthrough at the British Royal Agriculture Show in July 2000.

For that technological development, XY Inc. has earned the Northern Colorado Business Report's IQ Award for biotechnology and agribusiness.

"Every year, we developed the program further and further to get it out of the lab and onto the farm," Jacobson said.

Worldwide, perhaps $50 million has been spent over the past 20 years to make predetermining livestock sex a reality. XY itself invested more than $10 million in research and development since its inception, he said.

But the potential market is worth $6 billion, he said.

"This is what the market wants and now we're able to deliver it," he said. "There is no competition. There are lots of people with lots of claims, but they've never produced a reliable method of sperm sexing. Some haven't even produced a pregnancy."

XY Inc. has a 92 percent success rate with horses and better than 90 percent with cattle.

The method will increase efficiency in global food production and improve animals' lives, Jacobson said. For instance, 1.2 million dairy cattle are born in the United Kingdom annually, but only the females are kept for their milk. About 600,000 male calves are slaughtered and incinerated shortly after birth, he said. "That traditional process is inefficient, uneconomic and inhumane," he said. "If you don't want them, don't have them. In England, we're developing the concept of every calf (being) a wanted calf."

XY is also looking at the broader implications of its work, such as saving endangered species and in furthering pharmaceutical research.

IQ Award judges noted the importance of XY's work.

"It has a tremendous impact on the whole livestock industry. Also, it's a shift to a more humane process," they said. "It's a win-win-win in every direction."

XY is honored to be working in this field, Jacobson said.

"It's humbling to be in a position to make a difference in an area of technology that's so important - given my awareness that this has been described as the most sought-after technology of all time, given that's it's been described as a breeder's dream and given that it's calculated to be a $6 billion industry," he said.