The Moos Room™

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Joe: Welcome to The Moos Room, everybody. We are back and it's the OG3 yet again, and we have the same guests as last week. We are still with Vytelle this week. We're talking about a slightly different topic this week, but we still have Owen Weikert here and Bryce Schumann. They're going to walk us through some of the technology that we didn't really focus on too much last week, and that's IVF. Specifically some of the things that they do that are different than everybody else. We're not going to hesitate. We're going to jump right in. Owen, the big question is definitely your set of protocol has no shots. Tell me what's going on.
Owen Weikert: I know. It's the big dun, dun, duh. Like curtain rises and here we are.
Emily: Everybody's eyes get huge.
Owen: I know. I saw Bradley is really leap there. I came to Vytelle just about two months ago. I have felt I've been able to rediscover IVF and what can really be possible. I think a lot of that starts with our proprietary system of no FSH. I know a lot of people listening that have experience with IVF or conventional flushing. That word is four letter word, FSH. Costs a lot of money. I think it's up to $250 a bottle. I think that long term, I'm really, really proud of Vytelle for saying our system and our media is going to be able to do the work without FSH.
We're going to be able to deliver the results without the use of the hormone itself long-term. Do we really know the direct effects on those individual donors? We know that it's not good for them long term. Can we pinpoint overstimulation issues? Can we pinpoint donors that have chronic cysts that boils down to FSH and overstimulation? Absolutely. In terms of the animal, in terms of the embryo, and in terms of the food supply chain, is less hormones in all aspects of meat and milk production probably a better thing? Our stance is 100% yes.
How we come up with no shots? Those of you that have IVF experience with other companies, you're probably used to a one to a six-shot schedule, which typically takes between a 2-cc dose to a whole bottle of FSH. $250 is the retail cost of that right now. Thinking about that, the cost that can be billed in per embryo cost saving without the use of FSH. We're really, really excited to say that IVF is more viable to a larger audience because of the labor that's decreased with no FSH, the time, the welfare of the animal is enhanced. It's a much less invasive procedure when we have to give less shots and have less animal movement. We're really, really proud to say that Vytelle really putting the producer, the animal as the end goal that we don't need to rely on a drug to make embryos.
Joe: That's a big deal. Well, first of all, I'm going to be looking at it at the animal side. The repeated shots and the repeated movement. Those cows get used to going through the shoot so they're pretty good there and it's not a huge deal to get them to go. That many shots is not great for the animals. Anybody who's ever run any kind of shot program on their farm when we're looking at reproduction knows that it's a lot of work, it's a lot of time, it's a lot of money.
I'm excited to hear that there is somebody that's challenging that setup and feels like they can do it in a way that's beneficial for everyone. With that, tell me, what's the biggest challenge when you try to get this to go? Where do you see the hiccups? Where are the bottlenecks when you're trying to get this to work?
Owen: I think people get really scared because people that have IVF experience have relied on FSH to create big follicles on the ovary. This is an ovary. You can see here, let's pretend. [laughs] It's covered and hopefully, if you have a donor population or an individual that has a nice follicular population. She's going to have small and medium follicles. Probably mostly small depending on her wave and her cycle. What FSH does is that expands all of those follicles. It doesn't create more of them.
It doesn't create success in IVF. We've again, proven that, and that's a stigma is that we need FSH to make IVF work, and we need big follicles. We need medium and large follicles. We need a follicle that's big enough so that we can actually aspirate it. Really just the technique has changed. The technique and the science behind the culture with Vytelle, we're saying that a small follicle is really valuable to us. A medium follicle is really valuable to us. That OSI no matter what stage she's in, coming from a small follicle and being a little bit immature, our technology has the ability to meet that OSI where it is and help accelerate it.
It has the ability to nurture that OSI hopefully into the day seven embryo. I think that's a big, big shock to people. My advice is trust the science and trust the data behind it and trust that this is a new movement of a technology that's been around for a while.
Joe: We're going to have to ask you. Conception is the big deal. Is the conception any less compared to AI or even to IVF with other companies, whether you're utilizing FSH?
Owen: I would say the IVF conception rate, the Vytelle embryo versus the competitor is going to be nearly identical. We're going to be finding in a commercial dairy system conception rate of 40% to 45% is completely aligned with industry norms. We got there without that additional cost, the additional pain of a shot schedule. I 100% stand by the performance of the embryo in any setting. Whether that's the kid with the show cow that wants to haul into a satellite center of ours or the dairymen that says, �I need genetic progress double as fast. I need it from the female and the male side. I really need to do this. I need to correct issues that I have. I need to correct inbreeding coefficients that I've realized that I'm struggling with.�
The embryo has the ability to fix those things while in my opinion being very competitive within the embryo community. Also, I think we're getting to the point where, our 2023 goals, we really want to say that our Vytelle embryo is really competitive with sex semen. I think it is now, but we're going to keep improving every day.
Joe: The big question that comes up is that in a lot of cases when we're talking IVF, when we're talking about any of that kind of work. We're talking about the potential for higher abortion rates as well. Is that something you guys see?
Owen: Again, we're trending. I�d say we've reviewed 25,000 data points with pregnancies, conception rates, all the way through many different systems. I think that's a pretty robust database in the IVF game. We're running a very industry average of 6% to 8% abortion rate and that is throughout the whole pregnancy. You're going to have slightly higher at that 8%, most likely with a heifer population as your recipient. You're going to have a little less preg rate in a milking herd, but you're going to be picking up maybe a couple of points advantage in overall live calf numbers.
I often tell people that yes, we're in the embryo business, but we're actually in the calf business. We're not here to perpetuate all of this time and all the science and the work that our crew does, the producer does, to give you an aborted calf at the end of the day. The competency of our embryos is completely aligned with the industry average.
Joe: The question that we've come to that I left you guys on a cliffhanger before we started. The question I've always asked, and I subjectively see is that compared to AI calves, IVF calves are less viable after they're born, they're less healthy, they have more problems. Is there anything to tell me that I'm right or wrong in your mind?
Owen: I think that there is some differentiations in different IVF systems with birth weight, and I think that's important to point out. Vytelle is a system that is fetal calf serum-free, and that is an ingredient that really makes robust embryos and lots of pregnancies. It can lead to big birth weights that lead to unthrifty calves. Some systems do contain that ingredient. Building, Joe, on what you said just about general thriftiness, I think when we look at homozygous populations of full sublings, even though they're on a genetic bell curve, just like you and your siblings, you're all from the same mom and dad, but you have varying genetic value, I think what's missing specifically-- [chuckles] I have an identical twin so I can say it, I think, right? [laughs]
Joe: I'm sorry. That just made me think that now I'm going to have to get in touch with my brother and tell him that we have to argue about our genetic value.
Owen: Yes. You're the superior one I know that already.
Joe: Yes, that's right.
Owen: I think specifically in purebred cattle, maybe just Holstein breed I think is an example. I think we have a lot of undiagnosed recessives in purebred cattle. I think that as we make more and more homogeneous populations, a lot of those recessives are starting to show up. I don't know that for sure, just knowing the trends that I've seen just were getting such a tight population that I think maybe the next step of analyzing a lot of these really similar full siblings, I think there could be some genomic markers there. I would say in terms of my experience with embryos for five years before Vytelle is that there should be no statistical difference in the survivability of an IVF calf versus an AI calf.
Joe: I'm kind of on board with the same. My thought process has always been the birth weight and the delivery score is what has differentiated the two and so I'm glad that at least someone out there agrees with me.
Owen: That's really system-specific especially I would say back when companies were really trying to define what the median culture system could do and should do, I think that should do is maybe the big thing. Should it make these beautiful Grade 1 Stage 7 embryos or should we be focusing on live calves? I think that's a paradigm shift that the industry went through a couple of years ago. I'm really, really proud as a supporter of IVF technology of where we've come with the embryo today. I think maybe my message on a whole is for everybody is to trust the science. It's not a product or a solution for everybody. I love when it is of course but I think that it's a tool to get somewhere that you really aspire to.
Joe: Bradley, do you utilize any IVF up at Morris?
Bradley: We do not just for the simple fact of half of our herd is organic. It changes everything. If you don't have to give animals shots then well maybe there might be an opportunity there.
Owen: My real passion is more sustainable bovine in the world. I am currently a student at Harvard and I talk to my professors about this all the time. First of all, I think they think I'm crazy for being so engaged and involved in ruminant agriculture because, not in every case, but in some cases that's a big hex. Those cows are bad, cows are bad. I think that the more that we can adapt as an industry to trying anew, to being open to saying an embryo can bring me value not just by the maternal value of this milk cow or this maternal beef replacement that I'm making, but also, what value can be created from the terminal uterus that would have been used to make an average replacement animal.
I think that's a really compelling story that we don't speak as an industry enough. I think that each uterus and each heat cycle has a prescribed value and while I believe that we should maybe be turning the dial down on how quick and how fast and how forward we want to make volumes of pregnancy, we really need to be focusing on the quality of each pregnancy.
Joe: The value of each pregnancy I think is something that we struggle with and that's this whole dairy-beef discussion, right? It's trying to figure out how to take that terminal animal or as you described, the terminal uterus and make it more valuable. I think it's a great conversation to have and something we need to talk about more. Bradley, you had something.
Bradley: Well, it seems to me that you could really use this technology if you're genomic-testing your animals. We've genomic-tested everything here. You could look at those animals that maybe not as good of genetics compared to the other ones in your herd and maybe take some embryos from the good ones and put someone in the not-so-good ones so you're not necessary perpetuating those sort of-- I don't want to say [unintelligible 00:15:02]
Owen: Call them marginal. I call them marginal, yes.
Bradley: Yes, and improve the genetic level of your herd, or maybe you want to put beef embryos in those marginal dairy genetics and create beef populations.
Owen: Correct. I think Minnesota as a state has probably been the most progressive in that area of saying we can utilize a cow herd, maybe our aging or older lactation cow herd as a new value center via the embryo and that's exciting. Everybody wants to keep that fourth lactation that's just doing her job and she's the invisible cow but maybe we don't necessarily want a female replacement out of her. I think that's where IVF and embryo transfer even as a terminal entity makes so much sense.
Joe: One of the things that always comes up in my brain when I'm thinking about this is maternal influence on the pregnancy, right? Walk me through how you think about that.
Owen: If we're talking about recipient selection, Joe, is that kind of your thought? I think that this is such an untapped part of embryo transfer. The story doesn't start and stop in the petri dish. It means so much to have a competent recipient. We know how I can-- the nuts and bolts of that embryo being a seven-day organism and aligning with the seven-day heat. That's basic, I think, biology but we're able with the embryo to have actually stretched that heat cycle so we can go 24 or 12 hours on either side of that heat so that maybe that dairy wouldn't have to breed on Sundays per se if that makes sense which I really like.
I think that's an untold fun thing about the embryo, but if we're looking at populations based to find good recipients. If dairies are having, dairies or beef operations, if they're having problems making pregnancy with semen, an embryo is probably not going to fix those problems. It's probably going to actually punctuate them and make them look even uglier. Joe's like, "Yes, exactly. Yes." I will say that there are some really interesting management things that we can talk about to increase the value of heat because we can make a pregnancy more efficiently. I think sometimes again, going back to that dial on pregnancy creation that we've been pushing days open so, so hard I think an embryo has great success in 80 days open to 100. I really do.
That's probably a little bit scary for some people that say, "I really don't want my cows to be open that long. I keep pushing, pushing, pushing to shorten my days open." The competence of that uterus and just regaining tone in that uterus, having everything firing on all cylinders, and actually, having the strong enough CL to hold that pregnancy really, really starts to evolve around 75 to 80 days after calving. Just in terms of recipient selection, I know that Vytelle, Bryce, and myself, we want to be able to provide levels of analytical tools in the near future to help us recipient herds or commercial guys make the right decision on recipients.
I have guys that have a lot of success looking at genomic values. They're looking at HCR, for example. They're not putting an embryo in really, really ugly HCR at first. I wouldn't say I'm a believer yet but I think that's the right train of thought. Again, if we're going to create value, let's put this into an environment where it has a shot so that's a big thing.
Joe: All right, so now we have to talk about cost. That's the least of the question that it's going to come up and if we don't address it it's just not going to work. So Owen or Bryce, who's the one to talk to about cost?
Owen: That's me.
Joe: Owen it is. All right.
Owen: From the embryo side. Yes. What's awesome about Vytelle and what got me involved and engaged in the company and some of these discussions before I came to the company were just so, so positive about the fact that Vytelle is only selling number 1 frozen embryos. We can sell a number 2 embryo if that's the client's choosing at a discount but our entire model is based off of just the frozen number ones. I think that's really, really revolutionary when our biggest competitor in the embryo world, the sexed semen essentially. If we can take a frozen product versus a frozen product but have potentially double the genetic gain, there's an incredible story for that to continue to evolve and move forward in the commercial space. I think a lot of other companies relied on fresh transfer. A lot of that kind of goes back to just IVF was at one time just for really elite seed stock and that's just not the case anymore. Elite seed stock guys wanted every shot at every pregnancy. Even that grade 3 or stage 4, grade 2 embryo that looked really crappy in the dish and had maybe a 10% shot at making a pregnancy, they were still going to put that embryo in because that could have been $100,000 world dairy expo sale topper or the mile-high sale in Denver sale topper and the Angus side.
What I think is very, very inspiring is that we are only charging for the number one frozen and we have a great network of satellite centers where you can get that work done. We're really, really able to come on farm for a very comparable price to a client hauling into a satellite and typically an embryo commercially. We're really, really trying to say that we want to maintain our market, but we want to be fair to the dairymen. Depending on the volume, I think that Vytelle is as competitive as anybody in that commercial space with a frozen embryo.
Joe: You're not going to say a number for me, are you?
Owen: I don't because it can really be variant and I just want to keep it on that point.
Joe: No big deal. Bryce, are we looking at the same thing on the beef side? You guys feel like you're very competitive price-wise on that end?
Bryce: I think we have a great go-to-market strategy. I think the thing that differentiates us is what Owen is talking about is you pay for a grade 1 embryo. There's no other ancillary fees for setting them up or freezing them. It's simple. The folks that I'm talking with really like that because they know when they get the call or they call into the lab, eight days later they know exactly what they have, exactly what the bill is going to be.
Joe: Transparency on that end is great. We've got to talk cost even though no one will tell me a number, which is fine. Let's talk about benefit. Obviously, that's a ratio that is actually probably more important. When it comes to cost, how am I offsetting the cost?
Owen: The story really can be told most easily in operation before dairy that has a big genetic spread and that's really, really common. We all talk about bell curves and populations and population genetics. I think that what's so amazing is to see an operation that we can increase the genetic value in one generation by double at least. We can do that even more with purchased embryos. A lot of our clients are looking for markets. In the dairy space in particular, I think that the value of seeing a marginal or just antiquated Holstein herd being upgraded to the most elite cheese merit Jerseys in the world probably scares people to think that switch.
It sounds a little bit like Jurassic Park or sci-fi because they're that opposing almost in a way. The value of that genetically I think can be really easily proven on paper. I'm working with some great professionals at University of Wisconsin-Madison to help quantify that, to help quantify the lifetime production of an increase with a breed change. I'm really, really passionate about showing that value. That's something that Vytelle is working on as we look more and more at analytics and how we can provide comprehensive solutions. That is a point of interest that no one else in the industry seems to be addressing.
I think the Bull Studs are trying but a lot of their IP is based off of semen usage. I think what's so nice about the embryo is the value of one generation change and speed has value. I think that is even more and more evident at the milk buyer cooperative level. We need X amount of valuation in the milk that we're buying by this date, and the embryo is the way to get there. Same with guys who want to be crossbreeding. You can make a three-way cross of your ideal cross in every generation with an embryo.
What's your value there? I think a lot of it is situational, but I think the ability to double or triple the genetic value of a herd is inconceivable to think of that small embryo, that small one organism, how that can really shift the whole population.
Joe: Well, this is a discussion that I have with cattle producers everywhere. It doesn't matter, beef, dairy, and the discussion is how to bring the bottom up in your herd. We've always talked about how everyone is looking to go higher on the top end. Well, in my opinion, in 99% of the cases, bringing the bottom up is going to be more beneficial for that herd than ever taking the top higher. I really like the ability to do that quickly because like you said, speed has value. My question on the beef side, Bryce, am I wrong or am I on the right track when I'm saying that the bottom needs to come up usually before the top goes higher?
Bryce: I think you're spot on and it can actually be a combination of the two. I'm just thinking about the data I got a week ago on my feed efficiency. I had a two-year-old heifer that raised my most efficient gaining bull. Well, she just calfed yesterday so in a manner of weeks, I can start to gather IVF embryos. In that same data set from my feed efficiency, I know the calves that aren't getting it done and they can raise something out of my best one so in that combination, I take my poor producers out of production and I put my elite producers in production.
Joe: Perfect. I think we've got most of it. I think what we need to touch on before we wrap up here is that we got to come back to this whole sustainability conversation Owen is on so we can't avoid it. We got to talk about how does IVF contribute to sustainability? We covered it a little bit last episode, but give us a rundown again.
Owen: I worked in my past before Vytelle in genomic testing and a lot of that was building and thinking about repro strategies and genomic strategies to create a whole milk shed of hundreds of thousands of animals that was actually over four continents. How could we improve on that the most quickly? Every time I made a decision tree with a producer, whether he was milking cows in Wisconsin or in Kansas or in Italy, we always got asked the question, but I need to do this faster. I need to do this better. I need to make more animals of value and find solutions to create value from other pregnancies as well.
That is sustainability to me. I work with John Noble up here in New York, and I'd like to give him a shout-out if he's listening. I think he's one of the most reputable people in this entire business and just the most progressive, thoughtful person that gives a darn about his community and the state. I was sitting at his office and he told me, I asked him, I said, "What does sustainability mean to you?" He said, "Sustainability means vibrancy, and it means the ability to shift and to be able to change."
I think the more pressure that is put on our ruminant agriculture, beef, and dairy production in the United States, the ability for the embryo to shift populations, or whole milk sheds or entire feed yards for miles about the genetics in those yards. That's the discussion that gets me really excited, especially if we're using genomics and other tools to get there. All the different things we can use to be really, really analytical and push progress faster. I think that's at the end of the day what sustainability means is being vibrant and able to think on our toes.
I think the embryo from a genetic standpoint does that as good as anything. I'm really, really excited about the future for the IVF embryo as we are so, so, so lucky to push it out of its stigma of only being for a certain amount of people. I really think that we can start to spell out the value that it's for everybody.
Joe: Well, perfect. I don't think we can wrap it up in any better than that. We're going to cut it there and call it a day. Thanks again to Bryce and Owen for being on for two weeks in a row here. We really appreciate it.
Byce: Thanks.
Owen: Thank you.
Joe: All right. With that, you know the drill, scathing rebuttals, questions, comments, they go to the moosroom@umn.edu.
Emily: That's T-H-E-M-O-O-S-R-O-O-M@umn.edu.
Joe: If you want more information about what we talked about today, please reach out to us or visit vytelle.com. That's V-Y-T-E-L-L-E.com. Catch us on Facebook. We're on Facebook most days @UMNBeef and @UMNDairy. We're on Twitter as well @UMNmoosroom. Emily is also on Twitter at?
Emily: UMNFarmSafety.
Joe: Perfect. All right. Thank you everybody for listening. We'll catch you next week. You don't get a shout-out, Brad. You just don't get one.
Emily: Bye. Come on, you're done.
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