In Israel, embryonic entrepreneurship is lifeblood, but growing companies a challenge

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In Israel, embryonic entrepreneurship is lifeblood, but growing companies a challenge

By Alfred Romann, Staff Writer                                                                                                                                                                                                                      

TEL AVIV, Israel – When Yuval Mor took the stage at a conference in Tel Aviv to pitch his idea of using the tone of voice to predict Parkinson’s disease or cardiac events, he was unwittingly underscoring the good and bad of the entrepreneurship that is driving Israel’s growing med-tech market.

Unfortunately, the same early-stage entrepreneurial drive that makes it possible for Israeli companies to pump out new and very innovative projects in the biotech and med-tech space faster than almost anywhere else in the world may also be playing a role in holding back the development of large companies of a truly multinational scale.

For decades, Israeli entrepreneurs have been building companies and selling them at relatively early stages with significant success. They are supported by peerless research – Israel produces four times as many patents per capita in the life science space than the U.K. – and plenty of government support for young companies.

Israel has several basic building blocks to facilitate med-tech innovation, said Aharon Aharon, the CEO of the Israel Innovation Authority speaking at MIXiii Biomed 2017 conference in Tel Aviv this week. It has medical records for 98 percent of the population that go back almost 20 years. It has well developed knowledge databases. It has untapped human resources,

“We have the entrepreneurial spirit that is the basis of this country. And then we have the leading medical device inventions. So, we have all those ingredients,” Aharon said in a keynote address. “The first few signs are already here.”

In 2016, there were 64 venture capital-backed life science deals that added up to $470 million, about 15 percent of all the venture capital invested in the country, according to research from the IVC Research Center. That’s just the tip of the iceberg. There are also investments from private equity firms, private and government funded incubators, government grants that are relatively easy to access and more.

Mor’s interesting five-year-old company Beyond Verbal Communication is not atypical of the types of unique projects being developed in Israel. The company is looking to bring together digital health technologies and artificial intelligence along with the Internet of Things to turn vocal intonation into biometrics. Around the world, some 17 million people die every year from heart disease, so being able to identify and perhaps prevent events using phones or home speakers could be a game changer.

“We found early signs that the tone of voice could be used to differentiate between patients with the Parkinson’s condition and without,” said Mor. “This gave us the indication that the voice could be used in the early detection of Parkinson’s.”

“This is the vision. We are definitely not there yet, but now we feel more comfortable talking about this in public,” said Mor.

There are hundreds of young companies in Israel with unique technology and many of them were on display at MIXiii Biomed. Among them were the winners of the #Biomed #Startup of the #Year #competition which included digital health care company Nutrino Health, which helps diabetics track their diet and medical device company E-Shunt, that developed a minimally invasive surgical procedure for glaucoma.

Universities in the country produce plenty of research, much of which can be turned into viable and marketable products. Israel has plenty of experience in this. Two out of the three oldest university-based technology transfer companies in the world are here. One of them is Yissum, which is owned by The Hebrew University of Jerusalem and is the third tech transfer company ever set up in 1964. The first one was in Wisconsin, and the second was Yeda, at the Weizmann Institute also in Israel.

The amount of sheer innovation coming out of Israel is truly impressive.

“We need to exist. This is a survival mechanism, the fact that we are so flexible, so quick with ideas, so innovative. That’s what keeps us alive here, not only financially but literally,” Yissum’s VP of marketing Dana Gavish-Fridman told Medical Device Daily. “There is a real understanding from a young age that our kids need to be quick, they need to innovate.”

Yissum’s mission is “to let the public enjoy the fruits of the innovation that is discovered in the labs… that means anything that can come out of the labs should go back to the public in the shape of products,” Gavish-Fridman said. “To do that, you need to make business from that.”

“The first challenge is getting that seed money for the proof of concept… for the scale up. These things that are difficult when you only have a proof of concept and a patent,” said Gavish Fridmam. “That’s why we have our own funding. We have seed money. We also have to VCs.”

“The idea really is to get that extra funding for the scale up, for the proof of concept for the early stage technologies and then it would be licensed out under better terms. We’d be launching a start up that is a lot more mature,” she said. “Everybody is looking for the mature stuff, it is easier that way.”

In the pharma space, the process has led to the development of a couple of blockbuster drugs. One is Novartis’ Exelon (rivastigmine) for Alazheimer’s disease and dementia and the chemotherapy Janssen’s Doxil (doxorubicin HCI liposome injection), both of which were sold for more than $1 billion yearly.

Technology transfer companies like Yissum combined with government programs that fund very early stage and risky ventures, along with incubators, and private funding combine to create a very nurturing ecosystem for entrepreneurship and the early development of companies. After that, things get tricky.

“The good companies manage to raise the funds and find the investors. And yes, it is challenging. It has always been a challenge. That’s life, that’s business life,” said Gavish-Friedman. “What you need to have present is a really good team and a really good technology and then life becomes easier.”

Source: Medtech Insight

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By | 2017-06-01T07:35:24+00:00 June 1st, 2017|Blog, News|Comments Off on In Israel, embryonic entrepreneurship is lifeblood, but growing companies a challenge

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