Background
Fred Bang reported in 1956 that gram-negative bacteria, even if killed, will cause the blood of the horseshoe crab to turn into a semi-solid mass. It was later recognized that the animal's blood cells, mobile cells called amoebocytes, contain granules with a clotting factor known as coagulogen; this is released outside the cell when bacterial endotoxin is encountered. The resulting coagulation is thought to contain bacterial infections in the animal's semi-closed circulatory system.
In 1970 the U.S. Food and Drug Administration (FDA) approved LAL for testing drugs, products and devices that come in contact with the blood. Prior to that date, much slower and more expensive tests on rabbits had been used for this purpose.
Blood is removed from the horseshoe crab's pericardium; the crabs are returned to the water. LAL manufacturers have measured mortality rates of 3% in bled crabs, however recent studies indicate that this number may be closer to 15% or even 30%. The blood cells are separated from the serum using centrifugation and are then placed in distilled water, which causes them to swell up and burst ("lyse"). This releases the chemicals from the inside of the cell (the "lysate"), which is then purified and freeze-dried. To test a sample for endotoxins, it is mixed with lysate and water; endotoxins are present if coagulation occurs.
Read more about this topic: Limulus Amebocyte Lysate
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