Aug. 13, 1998

For more information:
Dr. Mervyn Jacobson,
970-498-8856, 970-491-4764 or 970-491-0469
or ISIS Public Relations, 970-229-0972

WORLD'S FIRST SEX-SELECTED FILLY SETS PACE FOR BILLION-DOLLAR INDUSTRY

FORT COLLINS, COLO--A potential billion-dollar biotech industry is riding on a brand-new filly.

     Meet "Call Me Madam," the first horse in the world to have her sex selected prior to conception via a cutting-edge cell-sorting technology developed by XY Inc., a Fort Collins, Colo., biotech company that expects to commercialize the technique in the coming years.
      The birth of Call Me Madam on Aug. 6 is a first in the horse industry and a major breakthrough in one of the world's most promising biotech industries--sperm sorting, which separates sperm that carry the X chromosome and produce females from sperm that carry the Y chromosome and produce males.
     "Selecting whether a horse will be female or male before it's even conceived will revolutionize the horse industry," said Dr. Mervyn Jacobson, chief executive officer of XY.
      Applications of advanced sperm-sorting for artificial insemination in the United States horse industry alone could be in excess of $300 million a year, said Jacobson. An equivalent potential market exists in the U.S. cattle and pig industries. The market outside the U.S. could more than double those projections, he added.
      Jacobson pointed out XY Inc.'s sperm-sorting technology also has the potential to annually reduce the wholesale slaughter of millions of young animals within food and companion species throughout the world.

In addition, Jacobson said interest exists for sperm sorting to help increase the number of females among the world's endangered species.
      XY Inc., which holds exclusive global rights to the sperm-sorting license in non-human mammals, was formed as a joint venture of the Colorado State University Research Foundation and Cytomation Inc., of Fort Collins, Colo.
      Founded in May 1996, XY Inc.'s original mission was to provide semen-sexing services to the U.S. cattle industry. With the appointment of Jacobson in January 1997, XY Inc.'s mission expanded also to include horses, pigs and endangered species, specifically, and all non-human mammals, potentially.
      Call Me Madam, born on a ranch outside Fort Collins, was carried by a mare named, Feisty, impregnated via oviductal insemination, using sorted semen that was introduced by flank incision.
     " To produce a beautiful, live foal whose sex was predetermined 11 months earlier is a first on many fronts--scientific, economic and ecologic.
     " We're elated," said Jacobson.
      So, apparently are breeders within the lucrative horse industry, which reported $548 million in stud fees alone in 1994. That same year, breeders reported receiving more than $3 billion in proceeds from horse sales.
     " From a horse breeder's perspective, time is money," said Brigitte Von Rechenberg, head of the muscular-surgical unit of the University of Zurich, Switzerland, and owner of top-class Arabian horses.

"A horse's gestation cycle typically is almost a year long. That's a long and expensive wait for a foal that's the wrong sex. If breeders can select a foal's sex, they can plan and build their business based on what clients are interested in buying, breeding or raising for show."
      Currently, the success of in vitro embryo production in horses lags far behind other domestic animals such as cows or pigs because of the horse's complex reproductive biology and the incredibly high number of sperm--500 million--needed to impregnate a mare.
      The breakthrough science of horse sperm sorting via flow cytometry was developed by XY Inc. scientists in conjunction with three other respected research teams at Colorado State University, the U.S. Department of Agriculture and Cytomation.

USDA researchers developed and patented the technology that allows sperm to be sorted by flow cytometry. Cytomation built the computerized device--MoFlo--to speed the sorting process. Colorado State researchers discovered how to make female animals pregnant with unusually low doses of sperm.
      XY Inc. scientists perform sperm sorting, "a living engineering process," according to Jacobson, that allows XY Inc. to dictate the sex of horses, cows and other animals before artificial insemination occurs.
      XY Inc.'s Director of Science George Seidel, a world-renown Colorado State reproductive physiologist, said, "Left to natural means, horses, cattle or other animals typically require millions of sperm per impregnation. And the sex of the resulting offspring is typically 50-50. The waste from unwanted sexes in animal-breeding industries is enormous."
      For example, breeders of polo ponies and performance horses view the "correct" sex of their horses as a criteria essential to a winning performance. The polo industry typically prefers female horses, which learn more quickly and are more adept on the polo field than male horses.
      Successful performance horses--jumpers--typically are male due to their strength and muscle mass.
     " At birth, almost all polo ponies born male in South America are regarded as no better than garbage," Jacobson said. "We also know about 10 million dairy calves annually born male are slaughtered at birth. Not a pretty picture."
      Jacobson continued, "This is truly historic. For 5,000 years people throughout the world have yearned to determine the sex of their animal herds. In relation to the horse, it took the joint collaboration of four research teams to make this dream come true."