Israel Innovation Authority eyes second biotech incubator

bio, biotech, lab, microscope, medicine

The success of FutuRX in Rehovot has led the Innovation Authority to plan an incubator in northern Israel as well.

The Israel Innovation Authority has announced its intention of conducting a tender for the founding of a second biotechnology incubator, to be located in northern Israel, in addition to the FutuRX incubator in Rehovot. The tender for operating the incubator is scheduled for publication in mid-2018.

Innovation Authority VP, Startup Division Anya Eldan says, "The success of the FutuRX incubator led us to think that one such incubator is not enough. The franchise holders for the incubator - Orbimed Israel, Japanese pharma company Takeda, and pharma and medical equipment company Johnson & Johnson - have created 10 great companies in the incubator. They built most of these companies from scratch on the basis of technology they brought from the universities and a team assembled within the incubator. Two companies from the incubator have already raised more than $20 million during the incubator period, and a fund has also been founded for investments exclusively in companies from the FutuRX incubator.

"One such incubator, however, is not enough to create a real theater of biotech innovation in Israel. There are several other concerns that are initiating biotech companies in the early stages in Israel, for example the Pontifax fund and the funds founded by the universities in order to promote the technologies developed by their researchers. There is no substitute, however, for an incubator that can pull together the intellectual property, the team, and the support of international companies."

Eldan notes that one of the main requirements in the new incubator tender will be participation of a large pharma or biotech company, like Takeda and Johnson & Johnson in FutuRX. "We are talking with international companies about investment in Israeli biotech companies, but a company usually prefers to focus its early stage investments close to home, because they require a lot of care and investment by the large company. For example, since Takeda became a partner in FutuRX, its managers and researchers are constantly visiting here. It is worthwhile for them, because they are involved in at least 10 companies here. If there is a mass of early ventures here, it will also be worthwhile for other companies to come here frequently."

Eldan notes that the state of biotech in Israel has improved in recent years, and the industry has matured. "New service companies have arisen and are operating here, new funds have been established (such as Israel Biotech Fund and the AMoon fund), and they are all very happy about the exit of NeuroDerm, which was an incubator companies sold for $1 billion. Such events encourage us to operate a biotech incubator, even though it's expensive. Each company gets a $2.5 million budget for three years, but it appears there is good reason for doing this."

Published by Globes [online], Israel Business News - www.globes-online.com - on September 18, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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bio, biotech, lab, microscope, medicine
bio, biotech, lab, microscope, medicine
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