Despite the fact that modern magic revolves around refining life force into magic power, few magicians have a clear answer as to what the soul actually is. There are a few prominent theories but there is little proof as to which is correct. However despite not understanding the mechanisms of the soul, there are methods to duplicate it (like with cloning or transplanting on the science side), and magicians can create a physical body to act as a container for the soul even without properly understanding it.
The product of this process is a magical life form. They are not life forms in the same way as angels and demons which are energy masses present in different Phases - they are either subspecies created by applying processes to organic material or new species produced from inorganic material, and can be made in an unending variety of forms. In the case of Alfar, the material used to create her was a fossil.
Magical life forms are not popular among magicians nowadays as the creation cost for one is too high and their lifespan tends to be unstable, so it isn't unusual for it to die straight after it was created. They also have problems interacting properly with the natural world and can often only live in the flask, test tube or artificial environment they were created in.
Magical life forms all have one thing in common - they are capable of original thought, which factors into the use of magic. As there are various complex processes which go into a spell and changing any portion could cause it to backfire and put the user's life at risk, rather than focusing on unstable magical life forms, magicians find it better and more convenient to put the same amount of effort into a spiritual item to reinforce their own abilities.
In modern times, magicians who seriously work on creating magical life forms are themselves an endangered species. The lack of creators also means there are few magical life forms and likely none outside the specialized ceremonial grounds and temples where they are created as they have trouble interacting with the natural world and perish.