TO: American Wagyu Association Membership

DATE: March 16, 2010

FROM: Board of Directors, American Wagyu Association

SUBJECT: Testing and Breeding Program for Inherited Genetic Defects in U.S. Black Wagyu Cattle

Over the last five years, many breed associations have undertaken genetic improvement initiatives within their respective breeds. Often this was the result of a calf being born with genetic defects.

Genetic defects are due to an abnormal or mutated gene. They may impair animal health or cause a condition of abnormal function or structure. These hereditary defects occur in all breeds of cattle, and some are strongly associated with certain breeds. Over 200 different genetic defects have been identified in cattle. Most of them occur rarely and are of minor concern, but some increase in their frequency to the point that they become a significant economic concern and need to be selected against.

Following a discussion on genetic diseases applicable to Japanese Black Wagyu at the fall Australian Wagyu Association’s annual conference, David Blackmore authored an article in the Australian Wagyu Update. The article reported recent findings, the result of research completed on Mr. Shogo Takeda’s line of Wagyu AI sires. Mr. Blackmore stated that 5 of Takeda’s major AI sires (TF Itomichi ½, TF Itohana 2, TF Mitsuhikokura 149, TF Itozurudoi 151, and TF Itoshigenami 148) are non-carriers of four recessive genetic diseases outlined below. However, TF Itoshigefuji 147 has been identified as a Carrier and TF Hikokura 1/10 is highly suspected of carrying the recessive gene for Chediak-Higashi syndrome (CHS). The symptoms for CHS include increased bleeding tendency, abnormal granules in platelets, and partial albinism (cattle often have light coats).

In an accompanying article, a leading Japanese genetic scientist reported that the "incidence of these diseases has now dramatically decreased across the Wagyu industry, and the frequencies of the mutant genes in the population have also been reduced considerably...as a result of DNA testing."

The American Wagyu Board of Directors learned of the findings in January 2010, and determined to take immediate and proactive steps to address the matter. The Breed Improvement Committee, led by Jerry Reeves, was given the task of assessing the issue of genetic disorders of Japanese Black Wagyu in the U.S. and determining a sustainable method of effectively managing and alleviating the problem.

Don Brown, a Wagyu Association member from Texas, was appointed to lead the task force. Don has been deeply involved with genetic disorders in another breed association. His team includes Holly Neibergs (Animal Science Department at Washington State University) and Tera Eerkes (iGenix - a company that develops genetic tests).

At the Board meeting in Fort Worth on March 12, Don presented the task force findings and a proposed program to address the issue in a manner similar to that used in Japan. After thorough discussion, the Board approved the program, details of which follow below. The presentation slides and voiceover will be made available soon on the American Wagyu Association website for members to download and review.

Research findings indicate that there are five recessive genetic disorders where specific genetic mutations have been identified, thus making it possible to develop diagnostic testing. The first four disorders are the same ones used for Takeda’s sires; the Task Force uncovered the fifth.

• Claudin-16 (CL16) disorder causes renal failure and death of affected animals. Other symptoms include growth retardation, increased blood urea nitrogen and creatinine values, diarrhea and overgrowth of hooves.

• Chediak-Higashi Syndrome (CHS) is a disorder that includes increased bleeding tendency, abnormal granules in platelets, and partial albinism (cattle often have light coats). CHS disorder is usually not life threatening.

• Erythrocyte Membrane Protein Band III Deficiency (Band 3) disorder causes spherocytosis and hemolytic anemia. Calves are born weak and small (40-55 lbs birth weight) with severe anemia, labored breathing, palpitations, and not able to stand or suckle at birth. Early death usually follows.

• Bovine Blood Coagulation Factor XIII Deficiency (F13) disorder where one of the proteins needed to form blood clots is missing or reduced. Symptoms include severely prolonged bleeding time, bruising from castration/branding, and severe anemia. Death occurs in most cases.

• Factor XI Deficiency (F11) disorder causes hemophilia-like bleeding tendencies, either spontaneously or following trauma and surgical procedures. Death most often occurs.

The American Wagyu Association entered into an agreement with iGenix, Inc. to move forward with the development of a single test which will detect cattle that are Free (also referred to as unaffected or normal), Carrier ( also known as positive), or Affected (have the disease), for each of these five genetic diseases. The cost of the test will be about $53 for each animal. A major component of the testing will be available in June or July. After that, positive controls for each of the disorders must be established. There is a small possibility that the single test methodology may not work with all five diseases. If this occurs, an additional test or tests may need to be developed. The final cost of the test per animal and the launch date are subject to validating both the single test methodology and positive controls for all five disorders.

Based on the current plan, the Board anticipates that testing will be available for Wagyu breeders about August 1, 2010. Once testing begins, turnaround time is estimated to be 1-2 weeks. DNA samples can be made from nose swabs, blood, semen or hair; however, nose swabs have been selected as the standard sampling method. The sample submission process will be similar to what is now in place with MMI Genomics (parent testing) and Pfizer (GeneSTAR). All test results will be sent to both the breeder and the American Wagyu Association.

The Association will test all Foundation and second-generation sires not owned by individual members. Breeders who are members of the Association will be required to submit samples for testing on their respective AI sires and donor dams. The Board believes it is prudent to test sires from which semen will be marketed, as well as donor dams in embryo transfer programs. The Board encourages testing of all other breeding stock, but it is not mandatory at this time.

Beginning October 1, 2010, all AI sires and donor dams must be tested prior to being registered, and all cattle sold in public production sales must include the testing status for every animal listed in the catalog. When registering or transferring non-tested breeding stock, the Association will mark the registration papers as “Not Tested for Genetic Disorders”.

An exception to testing: when both the sire and dam of the offspring have been tested and their results indicated “Free” for all five disorders, the offspring will automatically be given the status “Free.” Breeders should notify the Association at the time of registration or transfer of this information.

In the United States Wagyu has a very small genetic base; therefore, we must consider the value of a known carrier’s genetic worth to the breeding program. For example, TF Itoshigefuji (TF147), which has been identified to carry one undesirable recessive gene for CHS, but has thousands of desirable genes that cannot be replaced with any other foundation sires. So it makes sense to strategically mate TF147 to non-carrier dams and test the offspring. The Free offspring can then be used in the breeding program and the Positive offspring can be sent to harvest to avoid transferring the defect to another breeding herd, including crossbred cattle.

Wagyu breeders and the Board share responsibility for control of genetic defects in breeding herd populations. As such, breeders have an obligation to customers to be honest and notify buyers of any positive genetic defects known at the time of sale. Breeders should also make certain that all buyers, especially those new to the breed, understand the consequences of using offspring from known carriers. Marketing positive cattle without informing the buyer can not only harm breeder’s reputation but may also reflect negatively on the Wagyu breed and the Association.

The Board has directed that all test results be posted in a timely fashion on the Association website. In addition, all registration papers will include a notation indicating the test results for each of the five disorders. There will be no cost to have current registration papers updated with the test results provided that the papers are returned to the Association on or before December 31, 2010 and that the test sample is received by iGenix on or before December 31, 2010.

Breeders should remain vigilant about observing calf crops for congenital defects, collecting appropriate records and animal samples for diagnostics, and reporting problems with defect occurrence to both the Association and iGenix. Many of the congenital defects can be environmentally caused as well as inherited. These environmentally caused defects may be related to malnutrition, toxic factors, infectious disease, or extreme weather. Some of these environmental defects closely resemble some of the inherited genetic defects. Therefore, due diligence is required.

The Board believes that the membership must be informed about these genetic disorders but not overreact. There has been a tendency in other breed associations to react negatively and disproportionately. This will only hurt our Association and our members. We must look at this genetic testing as a tool to help us improve the Wagyu in the U.S. This initiative is a breed improvement strategy, which will certainly pay enhanced dividends to breeders and feeders and ensure the long-term integrity of the Wagyu breed.

Should you have any questions, please direct them to Don Brown. Don will continue to lead this project at least through the end of 2010. He can be contacted by email at [email protected] or by phone at (940) 577-9400. Also, please feel free to contact Ralph Valdez or Jerry Reeves as follows:

Ralph: by Email: [email protected], by Phone: (360) 941-0644

Jerry: by Email: [email protected], by Phone: (509) 397 2502