To catch a glimpse of evolution, Pim Stemmer doesn’t have to set sail for the Galapagos. He needn’t trudge through the Costa Rican rain forest or blast into Antarctic sea ice. For a front-row view of evolution in action, Stemmer simply walks over to a lab bench at Maxygen, a biotech startup in Redwood City, Calif., where he oversees research and development. At Maxygen, researchers are tapping evolutionary principles to “breed” new proteins, successively fine-tuning specific traits-say, heat tolerance or the ability to stick to a cancer cell-by tinkering with the underlying genetic code and selecting only the best of the new genes for the next round of improvement. In farm fields and kennels, exploiting evolution is old hat. Farmers favor a corn crop that best survives summer, for instance, and with decades of patience, breeders can produce dogs as specialized as poodles and Pomeranians. But in the lab, evolving better proteins is a recent feat-and a faster one. By focusing their efforts at the genetic level, one molecule at a time, researchers can coax a protein toward perfection in just a matter of weeks. In the process, companies like Maxygen hope to crank out safer medications, more potent cleansers and healthier crops. Just a few years out of the gate, these young firms are already bringing new protein products to market, forging alliances with such giants as Dow Chemical, DuPont and Novartis and launching successful IPOs (see table, “Evolving Industry”)-all evidence that “directed evolution” is really happening, not just in the test tube, but also in the marketplace.

Evolutionary Alternative

Directed evolution is an alternative to “rational protein design, ” a technique that became popular in the 1980s. In rational protein design, researchers try to craft a new molecule-perhaps an antibody or an enzyme-by first studying an existing protein’s structure and then modifying it via targeted mutations to the gene that encodes it. But that sort of painstaking methodology can prove to be difficult. Not only must researchers determine the sequence of amino acids-the 20 building blocks that make up all proteins-but they must also understand the complicated pattern of folding that the chain of amino acids undergoes to become a functional, three-dimensional molecule. Even after bringing sophisticated computer tools to bear on the problem, researchers say, it’s hard to unravel the workings of a protein folded up like origami, much less create a new one that behaves the way you want it to. “Rational design has failed miserably at helping us make useful proteins,” says Caltech’s Frances Arnold, who sits on Maxygen’s scientific advisory board.

Frustrated with the limitations of rational design, a growing group of researchers are borrowing from nature’s tool kit instead, mimicking the basic processes of evolution-the generation of genetic diversity and the selection of desirable traits-to improve proteins, even without understanding their complicated structures. And turning to nature can pay off quickly. A team led by MIT chemical engineer Dane Wittrup, for example, evolved an antibody fragment to bind 10,000 times more tightly to its target in just four rounds of directed evolution. Researchers like Wittrup hope better-binding antibodies might someday be used to fight cancer: Attach a cell-killing agent to an antibody that binds specifically and tightly to molecules found only on cancer cells, the logic goes, and you can wipe out the cancer without damaging healthy tissues. And it’s not just antibodies but a wide range of potentially useful proteins-from industrial enzymes to protein pharmaceuticals-that stand to benefit. “With just a few evolutionary cycles, we can dramatically improve molecules that have frustrated companies for years,” says Stemmer.

Do the Shuffle

Stemmer invented his version of directed evolution, called “molecular breeding,” seven years ago, while working at Affymax, in Palo Alto, Calif. The brainchild of entrepreneur Alejandro Zaffaroni, Affymax was the first company to focus exclusively on discovering new drugs through combinatorial chemistry-a shotgun approach in which huge libraries of unique molecules are randomly generated, and then the useful ones are fished out through clever screening. Extending the combinatorial idea into the realm of protein development, Stemmer struck upon the idea of shuffling DNA. The basic concept: Start with a few different versions of the gene for a protein you’d like to improve, cut them up and mix the pieces together to generate a diverse pool of new versions of the gene, fish out the ones you like best, and start all over again. In 1997, Zaffaroni spun off Maxygen to take molecular breeding to market.

Larger companies, sniffing the commercial potential of evolution in a test tube, began hooking up with Maxygen. One of the first was the Danish firm Novo Nordisk, the largest industrial enzyme maker in the world, which had already been dabbling in directed evolution on its own. Reporting last year in the journal Nature Biotechnology, scientists from the two companies showed how directed evolution might churn out a new laundry detergent enzyme. The researchers began with the structural gene for Savinase, a stain-eating enzyme developed by Novo Nordisk. Next they collected DNA for the naturally occurring version of the enzyme, subtilisin, from 25 different strains of Bacillus bacteria. With scissors-like enzymes, the team chopped up Savinase and wild subtilisin DNA, shuffling it together to create a new generation of unique “daughter” genes. Then the researchers inserted each gene into a bacterial cell. Finally, they exposed those cells to different temperatures and pHs to see how the resulting proteins held up.

The results were intriguing. While Savinase works best in a limited range of conditions-cool water and a fairly alkaline environment-some of the new proteins produced by the experiment worked four times better, and under acidic conditions. Many of the daughter molecules also performed better than their parents when heated or dunked in organic solvents. For 35 years, Stemmer notes, teams of industry scientists have tried to rationally design an improved subtilisin enzyme. “Within a year, three of our scientists turned out a much better molecule,” he says.

Celebrate Diversity

And who couldn’t use a better molecule? Analysts say the market for directed evolution stretches wide, including medicine and agriculture in addition to the chemicals industry. “This is no fad,” says David Molowa, a biotech analyst at Chase Manhattan in New York. “I think this technology is very real, and it’s already generating new products.” This list today includes a potential new catalyst for penicillin production, developed by Maxygen and now in commercial development at Dutch conglomerate DSM, and a fat-stain-removing enzyme from Novo Nordisk called Lipoprime, already on the market.

Indeed, the $2 billion industrial enzyme market is a logical niche for directed evolution, says Carolyn Fritz, global director of industrial biotechnology for Dow Chemical. Fewer than 30 enzymes generate more than 90 percent of industrial enzyme sales. That’s not for lack of trying on the part of the chemical companies to make new ones. The problem is that most enzymes fizzle under harsh, real-world conditions. Manufacturers could use new enzymes to make everything from paper to ethanol, low-cholesterol cooking oils and blue jeans. “We have a lot of different customers who could use better enzymes,” Fritz says.

To bring those enzymes to life, Dow has partnered with another biotech firm, San Diego-based Diversa, which has a different take on directed evolution from Maxygen. Rather than starting with a few different versions of a gene and shuffling the DNA, Diversa researchers typically begin with one gene and then introduce a multitude of mutations.

This technique generates maximum diversity in the pool of new candidate proteins. Indeed, using a procedure called “gene-site saturation mutagenesis,” Diversa researchers can try each of the 20 possible amino acids in each position along the protein chain-in less than two weeks. “It’s a numbers game,” says Dan Robertson, head of enzyme technology at Diversa, a game the company hopes will yield hardier and more effective proteins.

Diversa researchers stack the odds in their favor by choosing unusual genes as starting points. The company has hired far-flung scientists to collect microbes from extreme locations-the gut of a bug from the Costa Rican jungle, an industrial dump site or the rotting skin of a submerged whale carcass. By harvesting DNA from bacteria on that dead whale, Diversa scientists collect the raw genes for enzymes that naturally break down polymers or fats in nasty environments. “If we need a high-temperature enzyme to work under an alkaline pH, we go looking for places that already have those kinds of conditions,” explains Diversa CEO Jay Short. “We discover enzymes that are optimal in those settings, and then we can use directed evolution to push favored traits even further.”

Short says Diversa hopes to spread its discoveries around, selling improved proteins for everything from animal feed to human medicine. “I think directed-evolution tools are going to be very important for evolving human therapeutics-increasing a drug’s binding affinity or its half-life, or lowering the dosages necessary for it to work,” Short says.

Diversa isn’t the only evolutionary firm sizing up the $300 billion worldwide pharmaceuticals market. After working on enzymes for the oil industry, Enchira Biotechnology of The Woodlands, Texas, is moving toward crafting antibiotics and drugs that fight cancer, says Peter Policastro, company president. San Diego’s Applied Molecular Evolution is packing an extra punch into existing drugs by changing their protein structures, evolving more powerful medicines. Currently, AME is partnering with Gaithersburg, Md.’s MedImmune to churn out second-generation versions of several MedImmune drugs.

For now, Chase Manhattan’s Molowa says that directed-evolution firms will continue to sell themselves as technology-platform providers, partnering with industry giants that promise dollars and distribution. In addition to its deal with Novo Nordisk, Maxygen has forged collaborations with DuPont subsidiary Pioneer Hi-Bred, AstraZeneca and others-and has “proof-of-principle collaborations” with Abbott, Pfizer and Novartis under way. Diversa has joined forces not only with Dow, but with Novartis and Rhone-Poulenc, among others, as well. Eventually, Molowa adds, look for firms like Maxygen and Diversa to roll out their own products.

White Potato, Red Potato

As in nature, however, evolution in the lab can be a bumpy ride. Some researchers caution that the new technique has its limitations. “You’re not going to turn a potato into a broccoli,” says Arnold at Caltech. “Maybe you can turn a white potato into a red potato. The question is, what’s close, in terms of evolution? We just don’t know yet.”

It’s a question lacking easy answers. At Maxygen, company president Simba Gill says DNA shuffling has worked in 90 percent of experiments-and the firm drops the experiments that fail. Duke University biochemist Homme Hellinga says he would like to see chemists combine aspects of rational protein design and directed evolution, using computers to model new proteins and then testing well they can adapt to different environments.

But even proteins that evolve beautifully in the lab face classic development hurdles, warns Arnold. When Arnold’s lab evolved a detergent enzyme for Procter and Gamble, the new enzyme passed lab tests with flying colors-only to fall apart inside company washing machines. “You can’t mimic a washing machine in a high-throughput screen,” Arnold says. “You eventually have to try it.” In the same way, she adds, companies such as Diversa and Maxygen will have to prove that each of their evolved molecules works in the real world.

Yet another obstacle could crop up in an arena that is becoming central to almost all of high technology these days: intellectual property. Both Maxygen and Diversa have staked relatively broad patent claims, which some industry observers say might not survive litigation. And a patent issued to AME in 1998, if broadly interpreted, might force some players in the field to seek licenses from AME in order to continue their projects. AME set up a licensing program this spring and has already successfully defended its patent against one challenge in Japan. Regardless of how the legal landscape shapes up, though, directed evolution seems certain to offer researchers in academia and industry alike a faster route to better proteins for years to come.

CompanyYear of IPO,
Dollars RaisedClaim to FameMajor PartnersApplied Molecular Evolution
San Diego, Calif.2000,
88 millionTeaching old medicines new tricksMedImmuneDiversa
San Diego, Calif. 1999,
174 millionImproving on nature’s extremesDow Chemical, Novartis, AventisEnchira Biotechnology
The Woodlands, Texas 1993*,
16 millionA new push toward pharmaceuticalsGenencorMaxygen
Redwood City, Calif.1999,
96 millionMolecular breedingNovo Nordisk, DuPont/Pioneer Hi-Bred, AstraZenecaNovo Nordisk Biotech
Davis, Calif.–R&D subsidiary of Novo Nordisk, the world’s largest maker of industrial enzymesMaxygen, UC-Davis