The Israeli life science industry is healthier than ever, thanks to a record year of investments in 2014, according to Benny Zeevi, co-chairman of the Israel Advanced Technology Industry (IATI).
The industry, Zeevi said, “is rapidly and exuberantly growing, while playing an important role in the world healthcare market. Following a decade of significant growth, the Israeli life sciences industry is continually demonstrating encouraging parameters of maturity and promising signs towards a breakthrough decade.”
Zeevi made the comments in a report on the business in advance of this week’s BioMed 2015, an annual event that generally draws hundreds of industry executives, scientists and engineers, with thousands of attendees from over 45 countries. As in previous years, hundreds of Israeli life science companies will present and exhibit their products, services and technologies allowing for hands-on experience.
According to figures from the Israel Venture Capital (IVC) Research Center, quoted in the IATI report, $801 million was invested in 167 life sciences companies, a figure that was 55% higher than the $516 million raised by 142 companies in 2013, and 64% more than the $489 million invested in 133 life sciences companies in 2012. Between 2005 and 2011, an average of $371 million was invested in 99 life sciences companies annually.
Among the innovations at this year’s event will be a first-ever healthcare IT hackathon, in parallel to the conference and exhibition. Over three days, individuals with technology and healthcare backgrounds, including engineers, clinicians, entrepreneurs, software developers and designers, will divide into mixed groups of their choice and collaborate in order to come up with innovative solutions to health IT challenges. Among the projects hackers will be asked to take on: Technology solutions for monitoring patients outside the clinic and hospitals, such as telemedicine and solutions for preventive medicine; technology for improving patients’ information security, specifically when sharing information and coordinating between different healthcare systems; solutions for improving patients’ compliance with medical regime and medical care instructions.
Israel is the right place to look for that kind of innovation, said Zeevi. “Israel’s life sciences industry is innovative, where excellence in academic research, government support and increased availability of funding is translated into commercial success. It is based on a combination of highly educated professionals with entrepreneurial culture, innovative spirit and great technologies.”
Currently, according to IATI numbers, there are about 1,380 active life sciences companies in Israel, most of them (66%) less than a decade old. Ninety-eight new life sciences start-ups were established in Israel on average in each of the last seven years.
Besides start-ups, Israel is also a magnet for multinational health care firms, as it is for multinational information technology companies. There are dozens of global multinational life sciences R&D centers in Israel of global medical device, Healthcare IT and pharmaceutical companies. Most of these centers were established as a result of acquisitions of Israeli companies. Among the companies with R&D centers here: Novartis, Abbot Labs, Philips, GE Healthcare, Carestream, Johnson and Johnson, FosunPharma, and many others.
Over the past two years, Israeli life sciences companies raised about $1.4 billion on the NASDAQ. Out of 73 Biotech life sciences companies that underwent initial public offerings on the NASDAQ in 2014, 7 were Israeli companies (10%). Altogether, said the IVC Research Center, 11 Israeli life sciences companies went public on the NASDAQ, with average of $49.65 million raised. So far this year, one Israeli company, Check-Cap, has gone public on the NASDAQ. Meanwhile, said IVC, 51 life science companies are traded on the Tel Aviv Stock Exchange, making life science the exchange’s single largest sector. Since 2005, 62 Israeli life sciences companies have been acquired, woth the aggregate sum of the acquisitions nearly $8 billion – with $2.9 billion of those acquisitions taking place in 2013-14.
“Overall we are very optimistic about the future of Israel’s life sciences sector,” said Zeevi. “The industry has matured to the point where we can start seeing companies in advanced clinical development stages and companies entering commercialization and expansion phases. There is an increased interest in this sector from new foreign investors mainly from China and India as well as new US investors. Israeli life sciences technologies are being recognized by all the major multinational players in the field. We are witnessing growing numbers of quality, second timer, seasoned entrepreneurs especially in the medical device sector, emergence of seed ecosystem with the establishment of micro-funds dedicated to the sector on top of experienced angels, accelerators and the incubator system.”
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