"I believe that over the coming year, two or three of our companies will list on the Tel Aviv Stock Exchange , another one or two will list in New York, and we may see one of our companies being acquired, too," said Biomedix Incubator Ltd. (TASE:BMDX) CEO Ran Nussbaum at the incubator's first investors conference. Nussbaum is also a partner in Pontifax Ltd., which owns 20% of the incubator. He told investors why he felt biomed itself is an opportunity, why the Israeli market represents a unique opportunity, and why Biomedix represents an option on this market.
"One of the world's leading investment bankers told me that Biomedix is a call option on the Israeli biomed market, and we'd have to agree with him," Nussbaum began. "Life sciences is the largest sector in the world. It moves $500 billion in pharmaceuticals alone, and a further $70 billion in biology, and it is seeing double digit growth every year. The Biopharma Index beats the S&P Index every year. This field has some of the largest companies worldwide, with the most cash to spend - Johnson & Johnson, General Electric, Procter & Gamble, Pfizer, and others. These companies have a history of mergers, acquisitions, and investment in Israel.
"The Israeli industry is among the world leaders in terms of export and patents per capita. Companies such as Boston Scientific and Johnson & Johnson recently bought companies here at attractive prices. Next year will mark a turning point for an entire raft of up and coming companies such as NeuroSurvival Technologies (NST), Nasvax, Omri, DeepBreeze, Ovalum, and others. Once they succeed, the wave of giant companies flocking to Israel in search of new technologies will be unstoppable.
"Biomedix has enabled exposure to 50 life science companies, so we benefit from exposure to biomed, while diversifying our risk. We believe that we will receive 10 additional companies a year, so in five year's time we will hold 100 companies in all. To succeed, we will have to beat the statistics, but we will be satisfied if two or three of these companies are successful."
Nussbaum does not believe Israel will see a giant of the size of Pfizer Inc. (NYSE: PFE), Amgen Inc. (Nasdaq: AMGN), or even a second Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) developing locally, but expects instead to see the development of niche companies specializing in, for instance, bio-similar products, such as Protalix Biotherapeutics Inc. (AMEX:PLX), which started off in the incubator, bio-materials such as CollPlant Ltd., and immunotherapy such as NasVax Ltd. (TASE: NSVX).
Zvika Rubinstein, CEO of Meytav Technological Enterprises Innovation Center Ltd., Biomedix's first and more advanced incubator, said Biomedix was an intensive (and even aggressive, as he put it) incubator in terms of the services it provides its subsidiaries. "We prevent them from making a mistake that has already been made once, and clear the way for them to make new mistakes," he said.
Meytav also heads the Galil Biomed venture, an umbrella grouping of all the organizations involved in the promotion of a biomed industry in the Galilee region. Rubinstein said a "pre-incubator" framework would also be opened within Galil Biomed, for projects that could develop into companies in the future. "We're restless, and that's how anyone who works with us should be," he said. "Time is pressing, and we have a lot to get through."
Also attending the Biomedix conference was new Ashkelon Technological Industries (ATI) CEO Sarit Soccary Ben-Yochanan, who took up her post after Biomedix acquired its 80% controlling stake in ATI earlier this year. The remaining 20% is held by a local foundation, and Nussbaum said Biomedix is aiming to increase its holding in ATI. "The incubator will focus on life sciences and cleantech, and sell its holdings in other fields. The life sciences fields of interest to us most are orthopedics, dentistry and diagnostics," said Soccary Ben-Yochanan.
Collplant and Nasvax were presented to investors at the conference as examples of Biomedix's flagship companies. Collplant chairman Effi Cohen-Arazi explained that while many other companies also produce human collagen, none of them produce it from sterile plant sources. According to him, some companies use plants to produce proteins, but collagen is a complex molecule and producing it from plants represents a significant technological challenge.
Nasvax senior VP and CTO Dr. Ronald Ellis told the conference that his company's main product is CCSC (Ceramide Carbamoyl-Spermine), an adjuvant which also has an improved delivery capacity thereby enabling vaccines to be administered nasally. According to Ellis's data, vaccines now account for 2% of the pharmaceuticals market and are likely to grow in proportion to the overall growth in the market in the coming years.
Published by Globes [online], Israel business news - www.globes.co.il - on December 2, 2007
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