Lior Margalit was not nervous, he said. He pitches his medical devices start-up, Omeq Medical, to investors all the time.
This occasion was a bit different, though. He was going to present his company to about 50 Chinese investors sitting in three different cities via a conference call from an office on Tel Aviv’s trendy Rothschild Boulevard.
“How do you say hello in Chinese? ” Margalit urgently hissed to his chief technology officer, Assaf Gur, before entering a boardroom that had Chinese fans hanging from the ceiling and Israeli and Chinese flags on the table. Large wall screens broadcast the images of investors in the three rooms in three different cities in China: Beijing, Shanghai and Nanjing.
Margalit and Gur entered the boardroom and started their pitch. “Hi everybody,” Margalit said in English, and started to tell investors about his company. A translator, who had what seemed like flawless English, Hebrew and Chinese, fluently relayed his pitch in Chinese, then asked the Israeli developers, in English, questions posed by the investors.
Omeq, a maker of a sensor-based epidural injection system that allows for a more accurate performance of epidural injections, was one of the 10 Israeli companies invited to pitch their medical technologies last week to Chinese investors at TechCode Israel China Innovation Center’s first Tel Aviv-based virtual roadshow.
“We plan to hold this kind of roadshow from Tel Aviv twice a month with the aim of ramping up to once a week,” Holo Zheng, the general manager at TechCode Israel, said in an interview. Chinese investors are risk averse and generally want to make sure they are exposed to a great number and variety of technologies before making their decisions, Zheng said. The roadshows will include companies from a wide variety of sectors that already have a prototype product or a later-stage development, she said.
TechCode, which set up its office sharing space in Tel Aviv in March for entrepreneurs aiming to reach the Chinese market, provides enterprises with office space, business mentors, financial support, financial services, brand promotion and other services. The company is part of a global network of a dozen such workspaces in the US, Europe, and Asia.
Omeq Medical just completed a $1 million funding round and was looking to raise an additional $350,000 from Chinese investors and to access the huge market, Margalit said in an interview.
Epidural injections allow the delivery of drugs such as painkillers into the narrow epidural space that surrounds the spinal cord and its protective fluids. Because this area is only 4 millimeters wide, in 30 percent of epidural procedures the needle penetrates the wrong area or overshoots the target, as current technology depends on the skill of the doctor and his experience.
Omeq’s product, which has been developed but still needs regulatory approvals including from the US Food and Drug Administration, is a single-use device that costs around $30-$40. The product is added to existing epidural equipment used at hospitals, and includes a sensing mechanism and a probe that accurately identify the epidural space, Margalit said.
The mechanism prevents overshooting and can help save hospitals almost $500,000 a year by avoiding complications — these could range from severe headaches to impairment of the patient’s daily activities, he said.
There are other features and applications for which the product can be used beyond just providing much-needed pain relief to women in labor. Laparoscopy procedures or those around joints, in which the precise localization of a medical device is needed, could also benefit from the technology, Margalit added.
“The problem is how deep into the body you can go,” Margalit, whose father suffered from complications from a misplaced epidural injection, said. “Our system makes sure the injection doesn’t go in too deep into the spine. Today the standard care depends on the doctor using tactile feedback or a sense of feel. With our system the doctor uses the same techniques he has studied, but you add an additional layer of safety, similar to reverse sensors in a car. You are still the driver, but the sensors allow you to avoid bumping into other objects.”
The founders of InovyTec Medical Solutions Ltd., which has developed noninvasive and portable medical devices for out-of-hospital emergencies, were also at the TechCode event to pitch their technologies to the investors.
“Our focus is to provide safe and efficient solutions in the first few crucial minutes of medical emergencies,” Udi Kantor, the CEO and co-founder of the company said in an interview.
The start-up’s LUBO product, which has already obtained the necessary regulatory permits, including from the FDA, allows the opening of the airways in a safe and noninvasive way based on the field experience of an Israeli army veteran, Dr. Omri Lubovski. A veteran of Israel’s aviation rescue 669 unit, Lubovski realized the need for opening the airway in a noninvasive, quick and efficient manner, especially in complicated field or road situations.
In addition, Inovytec has developed the SALI, a portable device that can treat both cardiac and respiratory failures by allowing emergency responders to manage airways, oxygen therapy and defibrillation on site, and at the same time transmit signals and data to any remote emergency center for backup using cloud technology.
“We are looking for strategic partners and also for funding,” Kantor said.
Chinese investors have been flocking to Israel in search of new technologies as the world’s second largest economy shifts its focus from being a labor intensive economy to high technology.
Total capital invested in deals in Israel that have Chinese participation is expected to rise to $500 million this year compared to $118 million in 2012 and $467 million in 2014, according to data compiled by IVC Research Center, which tracks investment in Israel’s high-tech industry. IVC expects “the vast majority” of Israeli venture capital funds to have at least one Chinese investor in their financing rounds in 2016.
“The Chinese market is very interesting for us because the government has ended its one-child policy, creating a bigger market for epidurals,” Margalit said. “We are looking for funds and exposure to the Chinese market.”
And by the way, the Chinese word for Hello is Ni hao.