Every year, the average American eats 18 pounds of bacon whether that be alongside their eggs, in tandem with tomato and lettuce, covered in chocolate or just all by its lonesome. Go to any media platform and plug in the word “bacon” and you shall see for yourself, but the next time you take a bite out of that crispy piece of smoked cured pork we want you to think about xenotransplantation. Here’s a primer on xenotransplantation to get you all caught up:
That very important oddball word comes from the Greek word for “foreign” and refers to transplanting living tissue, cells or organs from one species to another, specifically, from a non-human species to a human being. Still want bacon with your breakfast? Maybe not after you just digested what xenotransplantation could mean for the 22 people who die every day waiting for a transplant. Every 10 minutes, another person is added to the list in total 119,000+ men, women and children currently wait, wait, wait and wait for what may never come. Humans have 5 vital organs that are essential for survival. Here are each of these organs along with the number of people who are waiting for a transplant:
- Kidneys – 101,076
- Liver – 15,000
- Heart – 4,206
- Lungs – 1,563
- Brain – (everyone who keeps up with the Kardashians)
As of 2016, 51% of adults in America are registered organ donors and there is not enough supply to meet demand. An individual can donate up to 8 lifesaving organs but the problem is that the donor has to be dead in order to give, and only 3 out of 1000 allow for donation. Why so low? This is because the method of death influences whether the organs can be harvested with the most viable donors being victims of head trauma, stroke and aneurysm.
So why pigs? Pigs are the animal of choice because their organs are anatomically similar to human organs. Primates were looked at in the 1990’s but virus transmission was much too high, and the larger the primate, the more problematic it became. Whether we like it or not, a pig’s organs are closer in size to human organs and take less time to gestate, making the time to harvest them a no-brainer.
Some people new to the idea of xenotransplantation may be asking why we can’t just throw a pig pancreas into a human and see what happens. The organs of pigs obviously have a different genetic makeup and mixing human cells with pig cells isn’t as easy as throwing ingredients in a blender and pressing the on button. Organ rejection and infection are two separate hurdles, each with their own complexity and individuality. Let’s look at three companies that are looking to make xenotransplantation a reality.
If you haven’t heard of United Therapeutics (NASDAQ:UTHR), they’re a $6-billion drug company with 5-year stock price return of +194% vs. the Nasdaq return of +91% over the same time frame. Maybe that’s because their revenues and profitability that look something like this (revenues in millions):
The first thing mentioning here is that UTHR has one of the coolest looking corporate websites ever. Just look at their leadership page.
Love that message. In addition to mandating humility in leadership, the company’s founder and co-CEO, Martine Rothblatt, has spent millions in supplying researchers with pig organs, specifically pig’s lungs through their subsidiary “Lung Biotechnology”. Through this subsidiary, UTHR is engineering pig embryos with human genes and then inserting the pig embryo into pigs that they are raising simply for organ harvest. Note that this is all early stage and none of their revenues come from xenotransplantation. What they’re envisioning though is a future solar-powered pig organ harvesting farm with helipads for organ transplant that looks something like this:
Now here’s where things start to get very interesting. It turns out that we can use CRISPR gene editing to edit pig genes so that we can solve the rejection and infection problems “much more quickly and accurately than has been possible in the past” according to this article by Nature. Now here’s where our ears really perked up. As it turns out, UTHR has invested $100 million into one of the single most promising synthetic biology companies out there, Synthetic Genomics. We’ve written about them before here and here, and also listed them in our list of biofuels startups to watch a few days ago. Here’s a quip from the latest UTHR 10-K regarding their ongoing relationship with Synthetic Genomics (SGI):
In addition to the SGI investments noted above, we entered into a separate multi-year research and development collaboration agreement with SGI in May 2014, whereby SGI will develop engineered primary pig cells with modified genomes for use in our xenotransplantation program. This collaboration was initially focused primarily on lungs and was expanded in September 2015 to include an additional focus on kidneys. Under this agreement, each party assumes its own research and development costs and SGI may receive royalties and milestone payments from development and commercialization of organs. During the year ended December 31, 2016, we made payments of $36.0 million for investments held at cost.
In July of last year, the CEO of UTHR made some remarkable statements on CNBC. Firstly, she said that her firm will grow from $6 billion today to “Google-like proportions” which implies a 96X increase in share price. She also predicted the “first transplantable organs in human patients before the end of 2019” and “FDA approval around 2023“. Martine was the highest paid female executive in 2013 with a pay package of $38 million so definitely someone who has credibility. As compelling as UTHR sounds, they’re not alone in their quest to master xenotransplantation.
Xenotransplantation came across our radar recently when a startup called eGenesis took in a $38 million Series A funding round a few weeks ago, bringing their total funding to around $40 million. eGenesis scientists are also editing pig genes using CRISPR genome editing, allowing for less rejection and infection in the host. Incredibly, the company was founded by someone who we ascribe deity status to – none other than George Church himself. Just two years ago eGenesis had spliced, diced and edited the pig genome in 62 places. With these advances in CRISPR technology, some researchers say human trials can begin with genetically modified pig kidneys in the next few years.
Founded in 2008, Miromatrix Medical Inc has taken in $41.75 million in funding so far to create replacement organs using a technology they call “decellularization”. The idea is that they can use this particular process to make organs transplantable from one species to another, not just necessarily pigs to humans. This would probably give them more options for testing, and the technology has been successfully used to create two FDA-approved products that are being sold today.
The first of these products called Miroderm (seen above) is a wound matrix made from pig liver tissue that is used for surgical and trauma wounds. Their other product, Miromesh, is also derived from pork livers and used for patients requiring soft tissue repair or reinforcement in reconstructive surgery. They plan to rescue a pig by the end of this year using one of their “recellularized” livers. So kind of xenotransplantation in reverse.
There are certainly other ideas about how to solve the organ supply problem such as growing organs or 3D printing organs (we’re looking at you Organovo (NASDAQ:ONVO)) but xenotransplantation seems to show the most promise. Whichever company nails xenotransplantation stands to benefit tremendously because customers are literally lining up, at least 120,000 that we know of. When George Church takes $38 million in funding to work on this, you know that it’s on now baby. As retail investors, we were really taken by UTHR’s compelling value proposition and frankly, we’re going to start accumulating a position using dollar cost averaging. Stay tuned and we’ll tell you the real reason why we think a prudent investment in United Therapeutics (NASDAQ:UTHR) should be on everyone’s radar.
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