Transformative Technologies in Israel

Transformative Technologies in Israel – How JJDC supports healthcare innovation at MIXiii-Biomed

Some travelers make a pilgrimage to Israel for religious reasons.

Others visit for the nightlife, the history or the enviable Mediterranean climate.

But from May 14-16, 2019, healthcare industry executives, scientists, engineers, and investors will come to Israel for another reason – to meet some of the brightest lights in Israel’s thriving life sciences industry at the 18th MIXiii-Biomed Conference and Exhibition held at the InterContinental David Hotel in Tel Aviv.

The MIXiii-Biomed conference covers the full spectrum of healthcare from prevention to diagnosis, monitoring, treatment, and rehabilitation. This year, the event will also explore trends and innovations shaping the future of the healthcare system.

“Other than Silicon Valley or Cambridge, Israel is probably the most important innovation hub in the world today for life sciences, especially for medical devices,” says Zeev Zehavi, Vice President of Venture Investments at the Israel office of Johnson & Johnson Innovation – JJDC (JJDC), one of the MIXiii-Biomed sponsors.

JJDC is the strategic venture capital arm of Johnson & Johnson, serving as a passionate force of healthcare investing for more than 45 years. JJDC has pursued investments across the continuum of healthcare and life sciences, finding opportunities that complement the pipeline and products of the Johnson & Johnson Family of Companies.

JJDC invests in dozens of companies each year and also partners with companies to create entirely new entities. In 2018 alone, JJDC deployed more than $450 million in capital across approximately 46 investments via its team which is based around the globe, including Zeev Zehavi, Vice President of Venture Investments and Tamir Meiri, Senior Manager of Venture Investments for Johnson & Johnson Innovation – JJDC.

JJDC currently has over 120 active portfolio companies across consumer, medical devices and pharmaceuticals. In Israel alone, JJDC has 13 portfolio companies, nine of which operate in the medical device and consumer products sectors.

“The Israeli healthcare industry is changing,” says Zehavi. “Israel has recently gained a reputation as a ‘Startup Nation,’ but the reality is that we already have 20 years of experience in certain healthcare sectors, such as medical devices. A lot of the people who are leading innovation in the medical device space are serial entrepreneurs who are now leading their second or even third companies. Meanwhile, the Startup Nation moniker fits better in areas like digital health and AI where we’re seeing more activity and investments.” 

For example, JJDC participated in the financing of Zebra Medical Vision, an Israeli medical imaging startup that uses machine and deep learning to build tools for radiologistswhich in 2018 completed a $30 million Series C raise to further advance the company’s efforts around its deep learning image analytics platform for the medical industry.

JJDC also has invested in Cartiheal, which is a privately-held medical device company headquartered in Israel that develops proprietary implants for the treatment of cartilage and osteochondral defects in traumatic and osteoarthritic joints.

Meiri cites three factors that make Israel such a hotspot for healthcare innovation. “First, many Israelis gain hands-on technical and engineering experience even before university during their compulsory military service,” he points out. “Second, we have a very good universal healthcare system. And third, electronic medical records (EMRs) have been a prerequisite since the early 1990s, which means that our digital healthcare startups can draw on a wealth of patient data that has been collected over the past 30 years.” 

It’s the quality and dynamism of the Israeli healthcare innovation scene that attracts Johnson & Johnson leaders like Nicholas Pachuda, Vice President, Orthopedics Innovation, Johnson & Johnson, who will be participating in a panel discussion at this year’s MIXiii-Biomed conference.

A big part of Pachuda’s job is to help the DePuy Synthes orthopedics franchise create partnerships and make investments with external parties in universities, startups and development companies. “I’m not looking for incremental solutions, but for transformational technologies with the potential to change the standard of care from both clinical and business standpoints,” says Pachuda. “For orthopedics, the hottest technologies involve digital solutions – both in terms of acquiring data to help surgeons and patients make better choices, and using robotics and guidance tools to improve surgical accuracy and precision in the operating room. When it comes to connecting with the companies working on these sorts of transformational technologies, there are probably more opportunities per square mile in Israel than almost anywhere else.”

Not only does Pachuda try to attend the MIXiii-Biomed conference each year, he finds himself bringing more and more colleagues along for the journey each time he comes. While he originally tended to travel to Israel with one other DePuy Synthes colleague, this year he is bringing four colleagues. They plan to have meetings with around 20 companies – both to reinforce relationships with existing partners and to meet new firms that might be good candidates for collaboration or investment.  

Some of these meetings could very well lead to new business opportunities. “Last year’s MIXiii-Biomed conference led to five or six deals for the Johnson & Johnson Family of Companies,” says Meiri. “Some deals were signed at the conference. In other cases, meetings at the conference build the foundation for a relationship that can end up as an investment or collaboration months or years later.”

According to Meiri, one major advantage of doing business in Israel is that it’s relatively easy to make business connections. “Even though we have more than nine million citizens, we’re essentially still a one-degree-of-separation country,” says Meiri. “You’re always one person away from the person you want to meet. Odds are you already know someone who was in the military, went to school, or worked with that person.”

According to Meiri, MIXiii-Biomed attendees also benefit from an Israeli predisposition toward making introductions. "Israelis are naturally warm people!" exclaims Meiri. "If I can help you by introducing you to someone, I'm very willing to do that. People are amazed by the connections they make at the MIXiii-Biomed conference. They can finally connect here with the people they've been trying to meet all year!"