2000 visitors attended the first Biotech conference in Israel in 2002. Over the years the conference experienced a significant growth reaching more then 4000 participants in 2005, and in 2007-2008 the ILSI took control of the conference and transformed it from a conference on Biotech only, into the Biomed conference which then included the field of medical devices. Since then the conference has gained international acclaim, and this year it attracted more than 6500 participants, from close to 40 countries, mainly leaders in industry, scientists, researchers, venture capitalists, and angel investors. This is an increase of over 200% since 2002.

For comparison, the Bio International convention, which is probably the World's biggest annual event in the field of Biotechnology, took place in Atlanta (USA) a month before ILSI Biomed, and attracted 14000 participants from 58 countries and 48 states. This puts the attendance at the ILSI-Biomed in Tel-Aviv in a very positive light: A more than respectable achievement for a country only 60 years old, with a population of 7.5 million, in an area roughly the size of New Jersey and situated in an area of considerable conflict and tension!

What is Israel's secret?  

An Ecosystem of Support

Built on a foundation of academic excellence, a highly skilled workforce, an entrepreneurial spirit and cutting-edge technological innovation, Israel has rapidly evolved into a recognized world leader for breakthroughs in medical devices, biotechnology and pharmaceuticals.

Through government agencies like the Ministry of Industry, the Trade and Labor's Office of the Chief Scientist and Investment Center, a network of technology incubators for very-early-stage technologies and an active and alert private venture capital system, Israel provides extensive support for new ideas and technologies, as well as the refinement and further development of more traditional industries. Israel invests strongly in its educational system, the source of many of the new technologies for which it is famous, and in R&D, where the investment of 4.8% of the GDP is the highest in the world. The investor-friendly environment is enhanced by government polices including tax breaks and investment benefits.

Figures reported by the Chief Scientist's office show that in the six months from November 2007 to April 2008, the Chief Scientist's office earmarked US$81.79 million in budgets for the life science industry. When broken down into industry segments, bio-pharma received US$20.62 million, biotechnology US$41.22 million, and medical devices US$19.95 million. In all, the Chief Scientist processed applications from 49 companies for support in 100 specific projects. Of the US$81.79 million given to the life science industry, research and development budgets accounted for US$32.81 million. The figures also show that support of the life science industry continues to grow in its share of the Chief Scientist's "budget pie", currently accounting for almost one third. In 2000, the Chief Scientist's office allocated 14% of its budget to this area. By 2003, the rate was 22%, in 2006 28% of the total budget, and by 2007, it was 30%.

The Chief Scientist, Dr. Eli Opper, commented on these reports that "Israel has prime academic centers of excellence, entrepreneurial spirit and technological capabilities. These factors join to position Israel as a significant global biotech force. The uniqueness of Israel's biotech industry lies in the combination between life science and other areas, such as nano-technology, smart materials and advanced electronics." The Chief Scientist added that his office is committed to continue supporting the life science sector, which is placed high on the Office's priorities. To realize its potential, he believes the industry has to be given large scale and long term investments. Dr. Opper pointed out that the funds provided are used to leverage even larger investments which would have been impossible without the State's support. The direct leverage ratio is 1:3 and can be as high as 10 or more as the projects develop.

In recent years, Israel has also become a magnet for foreign investors. A survey conducted by the Israel Venture Capital Research Center (IVC) before the ILSI 2009 Biomed Conference, showed that Israel-based Life Sciences companies received the largest share of seed- and early-stage investments in the Israel hi-tech industry in the first quarter of 2009 with 43% and 34% of all hi-tech investments respectively. Twenty-five seed and early stage Life sciences companies raised US$50 million in the first quarter of 2009, equaling the capital raised in the entire hi-tech industry. Medical device companies raised US$28 million, 56% of the total capital raised in the life science sector, and 11% of the capital raised in all hi-tech sectors. The IVC survey, conducted across the entire Israeli hi-tech industry, also revealed that the life sciences industry in Israel raised the third highest amount of funds (totaling 19% of all hi-tech capital raised) over the first quarter of 2009. "These results, appearing only weeks before the ILSI-Biomed Conference, highlighted how important the Biomedical and Life-sciences industries have become, even during the economic slowdown." Said Ms Ruti Alon, ILSI* chairperson, Biomed Conference chairperson and associate partner in Pitango Venture Capital Fund. "The clear interest and financial support reaching the life science industry makes the ILSI Biomed Conference even more important, giving international CEOs, experts, academics, scientists, researchers, venture capitalists and angel investors the opportunity to gather together to provide and gain insight on the future of the Biopharma and Medical device industries."

While 2009 statistics show an evident decline in the total capital raising compared to 2008, this does not worry the market's professionals. "The Biotech / Biopharma sector in Israel is not different from other sectors: it suffers from the international crisis and recruitment processes are at a standstill. However, the situation here is probably less bad than somewhere else: many Israelis that used to hold high-level positions in Europe or in the US are now coming back to Israel to take opportunities here. Moreover, despite the decrease in capital raising since 2008, the fact that we are continuing to see strong investments in Israeli seed-early-stage life sciences companies shows a lot of promise for the future of this sector. The evolution of the sector should come from outside because here the infrastructures are not prepared enough for near-term results" Ms. Alon says. "The last ILSI Biomed Conference provided many of the country's seed– and early- stage life sciences companies with an opportunity to showcase their technology and to attract investments."

ILSI Biomed on the International map

Thanks to the efforts of Ms. Alon and Mr. Makov (former TEVA general Manager and Co-organizer of the ILSI Biomed with Ms. Alon), the 2009 ILSI Biomed panel was attractive enough to bring thousands of visitors from all over the world and included subjects such as medical technological breakthroughs in a time of economic turmoil, investment strategy in a time of crisis, facing the change of regulation and legislation in the US markets (hosting Dr. Jesse Goodman, Chief Scientist and Deputy Commissioner, U.S. Food and Drug Administration whose keynote lecture focused on strategies to facilitate innovation in medicine and public health), impact of new FDA regulations on development of new medical devices (with the presence of three FDA staff members who talked about the evaluation of medical devices at CDRH) and cardiovascular therapies in 2020.

ILSI-BIOMED showcased Israel's extraordinary life science technologies (especially with the third international Embryonic Stem cell meeting, research domain where Israel appears to be an international leader), and provided the opportunity to explore and create significant collaborations between life science companies from Israel and leading U.S., European and Asian companies.

At the first show in 2002 there were only 40 visitors from abroad. This June 2009, more than 800 visitors from 40 different countries attended, in addition to the 62 Medical Device and Biotechnology local companies. A closer look reveals that from 2005 (400 visitors from abroad), the conference experienced significant annual growth. ILSI was launched in January 2005; however the organization took the lead role in the scientific and steering committees in 2007 a role which increased in 2008 and 2009. During this time there has been a significant increase in the number of attendees, and, although non-quantitative, a senior level was noted as well.

As in the past, most of the visitors from abroad (40%) came from the USA with the presence of leading companies such as BMSJ&Jand Merck & Co. Taking a growing interest in the Israeli Market, European presence in the show was considerable. France was represented with the second largest delegation, and together with Denmark and Italy presented their own events during the show, emphasizing the growing cooperation between Israel and Europe in the Biotechnological field.

There is already some cooperation between French and Israeli companies in this field. Sophia Antipolis and RadBiomed, the two leading innovation-clusters in France and Israel are proclaiming their intent to enter into a collaborative agreement towards joint establishment and nurturing of successful early-stage life science and other knowledge-intensive ventures. This joint effort will bring together the Israeli entrepreneurial spirit and forward looking innovation and the vast richness of infrastructure, resources and skills in France. There are also contacts and negotiations for a joint venture between the French cluster Alsace Biovalley and Hadassa, the Jerusalem hospital, or negotiations for the inclusion of Israel in the Bio-CT project headed by the French cluster Genopole, and the Pole Cancer Bio santé has made serious contacts for partnership with some Israeli companies.

Mr. Philippe Tramoy, Managing Partner of CBDM.T, the Market and Business Intelligence company specialized in the life science market, quickly understood the importance of the life science Market in Israel and opened an Israeli office at the end of 2008 as the company's investment in this market. "When I came to my first Israeli Biotech show in 2004, there were only 4 French companies attending it, and not many more from other European countries. Most were from The USA. This year, we were part of 34 other French companies – among them some of our clients – together with tens of other European companies which attended the Biomed show." says Mr. Tramoy.

"Israel's life sciences industry is recognized as a fast-growing, vibrant force with a strong global reputation. Today almost every multinational pharma or medical device company is represented in Israel. In 1998 there were less than 100 Israeli life science companies (among them 25 Pharma biotech companies). Today there are over 1000 active life sciences companies (among them more than 200 Pharma biotech), with over 80 new companies starting up each year. The result of this rapid growth is that half of all Life Sciences companies operating today are less than 5 years old and 70% have fewer than 20 employees. Nevertheless, in contrast to the accepted characteristics of the sector, an astounding figure of 40% of Life Sciences companies already generate revenue, demonstrating that Israel has crossed the threshold of excellent early-stages R&D activity and has moved into running attractive and commercially viable businesses. At CBDM.T we specialize in providing business development and market intelligence services to small and mid-size companies and this is one of the reasons we believed in the opportunity to open an office In Israel to meet the needs of most companies."

Whether as a direct result of the Biomed or simply a coincidence, the French Pharmaceutical leader Sanofi-Aventis (Sanofi-Pasteur) recently signed a 1.8 million euro contract with the Israeli government for Flu vaccines. Another suitable example of the European interest in the Israeli Biotech Market is the intention of the Swiss Pharma giant, Roche, to invest in some Israeli companies through its very new partnership with Pontifax, one of the local Venture Capital Companies.

France is not the only European player active in the Israeli Biotech market. Headed by its dynamic ambassador in Israel, Ms Liselotte Kjærsgaard Plesner, Denmark gave a great show and a noticeable presence in the conference. "7 companies participated this year in Biomed from Denmark, together with the flagships of Danish industry, Novo NordiskLundbeck, and Novozymes: a significant increase from last year" Said Ms. Ilana Krasnik Rawlings, the Danish embassy's economic attaché."This year we held a booth and an event at Biomed, while last year we were only visiting, and had our event outside the venue. The results are apparent. The first example is a cooperation agreement between Novozymes and Matimop. We observe much more cluster cooperation focusing on Biotech, since I started at the embassy. We have a Memorandum of Understanding with Israel, regarding pre-project funding for Eurostars projects between Israel and Denmark within industrial R&D. The Danish biotech cluster is one of the largest in Europe and we see great possibilities for cooperation between the Israeli and Danish cluster." concludes Ms. Krasnik Rawlings.

Besides Europe, there is a growing interest from Asian countries including Japan, China and especially Korea, since 2008. For the 8th Biomed this year, 13 Korean companies were a part of a big delegation. Among them were big players such as: KolonSK Chemicalsand GCC. Korea seeks to learn from the Israeli example. With a population of 48 million and only 600 Biotechnology companies (Israel: 7.5 millions / more than 1000 Biotechnology companies) Korea has set as a national aim the development of this sector. There is a growing demand from the Korean population for advanced technological and medical services. Korea couldn't find a better source of inspiration and example than Israel in this field.

In the near future, many International companies may follow the trail of big Pharmas and companies such as CBDM.T that have already invested in the Israeli Biotechnology market. "There is a growing demand for partners in business development in Israel and in Europe. The Israeli government has instituted various programs such as the agent detection program which is being implemented by the Israel Export Institute. From the European side there are programs such as Eurostars, which is the first funding and support program dedicated to funding SME's and start-ups collaborative research in the field of biotechnology. There are also joint programs such as FIRAD, which is a French-Israeli initiative for technological cooperation. CBDM.T can play an important role in creating the necessary links between the Israeli and European companies" says Mr. Olivier Soussan, managing the CBDM.T office in Israel. "Since the last Biomed several promising biotechnology companies from domains such as Pharma, Drug discovery and Medical devices have signed agreements with CBDMT, in order to develop their business in France and Europe. France is currently the biggest European market for most products, and CBDM.T, with its offices in Paris and Geneva, its 25 worldwide experts and thousands of market contacts offers the advantage of in-depth knowledge of the European market. At the same time, the company's office in Israel provides a vast source of information for European companies that seek to invest in Israel."

Is Israel then a 'Promised Land' for the world Life Science Industry? In the words of Mr. Paul Smith, Senior VP of Philips Medical, after a visit in Israel in July 2004: "In two days here, I saw more opportunities than I saw in a year in the rest of the world".

To contact Olivier Soussan directly

Sources

IVC Research Center; IMD Competitiveness Report; Israel Export & International Cooperation Institute; Industry Cooperation Authority (ICA); The Israeli Investment Center (IIC); The Office of the Chief Scientist (OCS); Israel Science and Technology Homepage; Manufacturer's Association of Israel; The Israel Association of Software Houses.

* ILSI is a non-profit organization, representing the mutual goals of approximately 800 Israeli life science companies. Its mission is to research, develop and advocate policies and actions that promote medical device, biotechnology, pharmaceutical and Ag-Biotech in the State of Israel and increase awareness of its strength and innovation worldwide.

For detailed information, feel free to read full article at: http://www.lifescience-online.com/

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