Conceived in the 1950s by New York State business man Joe Mancuso when he leased out space in a disused factory to attract companies to an under-developed area, business incubators seek to help entrepreneurs and start-ups overcome challenges in turning ideas into viable businesses.
Incubators give start-ups a home early on alongside like-minded individuals and companies. This collaborative approach allows start-ups to save on operating costs as they share facilities and associated overheads, as well as connecting them with future potential investors and the incubator’s wider network of industry experts and mentors.
Digital health and med tech start-ups require special support since their innovations need to be compliant with a particularly stringent regulatory system and are entering a particularly crowded sector.
Specialised med tech incubators are able to advise their start-ups on these issues and use their extensive industry expertise to point out gaps in the market or where potential partnerships could be formed. Therefore, incubators have a crucial role in bringing life-saving innovations to market.
Here is a list of five promising med tech start-up incubators from across the world that will contribute to improving human health in 2020.
BioCity: fostering innovation outside of the UK’s golden triangle
Founded by Nottingham’s two universities in 2002, BioCity focuses on making life science innovation nationwide and not just focused within the ‘golden triangle’ of London, Oxford and Cambridge. It defines its mission as “creating a UK-wide business collective…to help science entrepreneurs tackle global challenges.”
Now BioCity has five sites across the UK – two in Nottingham, two in Glasgow and one in Alderley Park, Cheshire. One of each of the Nottingham and Glasgow sites focuses on med tech specifically – in fact, the Glasgow site is Scotland’s primary med tech incubator – and Alderley Park encompasses both biotech and med tech on one site.
To date, the UK-wide incubator houses more than 200 companies across the life sciences; they are supported holistically through their journey from business inception to exit, however, the exact terms of the partnership BioCity has with its start-ups are flexible to suit their specific needs.
In addition to BioCity’s incubator approach, it also has an accelerator programme, which offers $100,000 over a 12 month period to mentor promising companies, and a venture development team that directly invests in the collaborative’s start-ups; to date 27 companies have received early stage funding from BioCity.
The success of BioCity’s model is proven by BioCity being chosen in February 2019 to run a similar business accelerator programme in an existing Newcastle City Council lab and office. Newcastle, and the North East of England, are promising areas for life sciences start-ups.
Cross-fertilising industry and academia with BioAlps
While other incubators have explicitly chosen to establish their hubs near to universities, Swiss BioAlps prides itself on the benefits of incubating start-ups so close to world-leading pharma giants as well as universities.
The incubator notes that Medtronic, the world’s largest med tech company, as well as pharma giant Johnson and Johnson, among other multinationals have established research and development (R&D, and commercialisation operations within the BioAlps cluster. In addition, the Ecole Poly technique Fédérale de Lausanne, Geneva University Hospital and University of Berne are all located nearby in Western Switzerland.
In addition, because of Switzerland’s central role in the global economy, BioAlps markets itself as being a good location to access international financing.
The incubator currently houses 257 med tech start-ups within its cluster. A noteworthy example of a promising start-up at BioAlps is EPFL spin out called Lunaphore; in January 2020, the precise diagnostics platform completed a Series C round that raised CHF 23m ($23.4m); interesting, the he primary investor in the funding round was Japanese PHC Holdings Corporation. This capital influx brings the start-up’s total funding for market launch of its product to CHF 111m ($113m).
From San Francisco to Hyderabad: the global reach of Novartis Biome
As incubators emerged as a successful approach to bringing innovative products to market, big pharma giants jumped on the bandwagon. AstraZeneca, Merck and Bayer, among others, have launched digital health-focused start-up incubators in various locations globally.
However, Novartis has set the stage of a particularly innovative 2020 by opening its fourth global innovation hub. Only 18 months after its initial San Francisco launch, in February 2020, the Swiss pharma giant unveiled its first Asia-based incubator in Hyderabad, India.
Novartis chief digital officer Bertrand Bodson explained the location choice was because of India’s strong, and growing, med tech industry. The pharma giant believes that creating global, interconnected, incubator hubs, will facilitate even better collaboration and connections across the world.
Novartis’ general plan for its Biome incubator project is to foster technology that can disrupt the healthcare industry and allow for better, quicker treatment of patients.
However, unlike other incubators, Novartis Biome provides its start-ups with access to Novartis’ datasets in validation studies, in order to further enrich their proof-of-concept studies. Importantly, Novartis does this without asking for ownership of the company – although it will obviously have the option to invest following positive trial results.
Combining consultancy and incubation at Intuitive X
Seattle-based IntuitiveX prides itself for more than halving the time to market, as well as cost of product launch, for life science start-ups it incubates.
The two defining features of IntuitiveX’s incubation model is its huge network of industry partners, investors, clinics and distributors, as well its ability to combine incubation with consulting services.
For med tech start-ups, and larger clients, IntuitiveX can advise on issues related to prototypes, regulatory compliance and manufacturing.
One of its flagship incubation successes is Amplify Surgical. Only a few months after the launch of dualX, a titanium expandable spinal implant, 100 devices had been implanted into patients. The feedback from various spinal surgeons noted that dualX improved significantly on the standard of care.
Spotlight on Israel: Alon MedTech Ventures
As can be seen from the previous four case studies, the vast majority of med tech incubators work generally across the life sciences ecosystem. However, Israel’s life science incubators largely buck this trend; this not particularly surprising due to the strength of the country’s general tech ecosystem and its outsized med tech sector.
One example is Alon MedTech Ventures, which leverages the extensive experience of its entrepreneur founder Dr Shimon Eckhouse in the med tech field; he has invested in two leading international med tech companies, ESC Medical and Syneron Medical.
At the end of January, Serenno Medical announced it has completed its first human clinical study for its automatic kidney monitoring device, which prevents hospitalised patients developing life-threatening acute kidney injury. As well as bringing value to patients, the hope is that this device will reduce the workload of nursing staff and ultimately save hospitals money.
While Butterfly Medical announced the completion of a $2m financing round that will allow it to initiate a pivotal clinical trial of its prostate implant. Eckhouse commented: “Butterfly is another great example of the original way of thinking and the level of execution of the founders we work with at Alon and our ability to develop together innovative solutions to medical problems with huge market potential.”