Companies are bursting at the seams with tools to engineer pharma’s next magic bullet: the new and improved antibody.

After selling his first company to Merck in 2006 for $400 million, Dartmouth bioengineer Tillman Gerngross faced a tough decision about starting another company: choose a field with minimal competition but high risk of failure, or enter a space that was already clinically and commercially successful but crowded with rival technologies. He chose the latter when he chose antibodies. “I hypothesized that if we had a truly better way of discovering antibodies, there was business to be had,” says Gerngross.

Professor Tillman Gerngross

Still, at the time, the pharmaceutical industry was already saturated with companies looking to identify new antibodies and engineer existing ones to be more effective. From a distance, pharma’s obsession with these Y-shaped proteins is baffling. Big and clunky proteins, antibodies take twice the time and money to develop into a marketed drug that small molecules do, are terribly complicated to manufacture, cannot be taken orally, and have a history of causing harmful immune reactions.

Yet antibodies have something that small molecules, growth factors, and cytokines lack—exquisite precision. Unlike any other class of drug, an antibody gloms onto a target like a magnet latching onto a needle in a haystack. As therapeutics, antibodies can be used to specifically bind a diseased cell, ignoring healthy cells, and cause the diseased cell to self-destruct, for example, or activate the immune system against it. The large molecules can also suppress the immune overactivity that characterizes autoimmune diseases, bind rogue proteins, deliver toxic payloads to sites of illness, and more. In the late 1990s, antibodies finally lived up to their promise as companies learned how to successfully engineer them. First there was Rituxan, then Herceptin, then Remicade. All are billion-dollar blockbuster drugs, for non-Hodgkin’s lymphoma, breast cancer, and Crohn’s disease, respectively.

Gerngross joined the fray in 2007, cofounding the small New Hampshire-based biotech Adimab, and spent the next 2.5 years building a yeast-based antibody-discovery platform designed to be less complex than existing technologies. And it worked: in 2009 the company signed five partnership deals with pharmaceutical companies; the following year, they inked 10 more. Last year, the first of the company’s antibody therapies headed into clinical trials.

Gerngross’s success is not only a tribute to his company’s technology, but an indication of the industry’s continued thirst for new antibodies. “There’s been a sea change,” says Bassil Dahiyat, president and CEO of Xencor, a California-based antibody biotech. “Because there has been a lot of success with antibodies, the industry now feels that this is actually viable—that there are many multibillion-dollar drugs to be had.”

Today, biotech companies left and right, far more than can be described in a single article, are inventing ingenious new ways to discover and engineer antibodies by tweaking every part of the proteins, from the tips of the Y to the bottom of the stalk. “It’s a great time to be in this space,” says Gerngross. “I’d do it all again.”