1. Biotechnology Incubators in Israel

2. The Israeli Biotechnology Market 160 companies (30% in therapeutics) 4000 employees Market valuation: $3.5 billion Market capitalization: $2.7 billion Av. Annual growth in no. of companies: 14% Sales: $600 million 75% of the companies employs less then 20

3. European Biotechnology Per Country Source: E&Y

4. The existing incubation system 3 types of bio-incubators in Israel: Public incubators Private incubators Public\Private incubators – public incubators which were partly privatized

5. Public Incubators The existing system of public incubators: Duration: up to 2 years Funding per project: up to $350,000 Government participation: 85% Ownership: Entrepreneur - 50% Private investors - 20% Incubator - 20% Other staff members - 10%

6. Public Bio-Incubators Many public incubators have some biotech firms 2 public incubators specializing/half specialized in biotechnology: Biomedical Incubator Rad-Ramot Ltd. Naiot Technological Center Ltd. Both incubators display relatively high levels of private holdings

7. Problems with the Public scheme Percentage of ownership is predetermined Inflexible terms Duration of funding limited to 2 years Budget per project limited to $350,000 No shared infrastructure (not recognized as an eligible cost of the incubator)

8. Private Initiatives in Israel Eager Biogroup Ltd. Hadasit Medical Research Services and Development Ltd. (Haddasa Hospital) Clal Biotechnology Industries Ltd. The Center for Advanced Technologies (Tel Hashomer Hospital)

9. Eager Biogroup Ltd Incubator ownership: private investors Seed funding and mentoring against X% ownership (depends on the level of involvement) Focus: IP strategy and clustering of related projects

10. Eager Biogroup Ltd International collaboration with the Pasteur institute in Paris and the European molecular biology labs in Heidelberg. Average initial investment of $200,000 Present status: 7 incubator companies

11. Hadasit Medical Research Services and Development Ltd. An incubator within Hadassah Hospital Ownership: Hadassah Hospital Entrepreneur receives up to 20% Funding of projects: Initial sources of funding: internal sources and Chief Scientist In later stages external investors are sought by the incubator management team for each project Management: highly experienced personnel Present status: 5 companies

12. Clal Biotechnology Industries Ltd Ownership: Clal Investment Group Up until 2 years ago the company only invested in mature companies: at least in phase 1. Following a strategic decision to invest in Start-ups the incubator was established. The incubator will house 4 portfolio companies Shared infrastructure including clean rooms GMP/GLP services

13. The Center for Advanced Technologies An incubator within Tel-Hashomer hospital Ownership: Tel Hashomer – the state of Israel Incubator concept: To commercialized ideas coming from the hospital staff To enable external entrepreneurs using the advance hospital infrastructure

14. The Center for Advanced Technologies 5 permanent research staff Funding of projects: mainly from the chief scientist and from MAGNET. Some projects are funded by private investment 6-8 projects

15. “ Most incubators tend to become specialized within biotechnology ” Main causes for this: Geographic proximity between companies leads to synergies Management specialization Shared infrastructure Relevant Network

16. The New Public Biotech Incubator Initiative

17. Biotech requires more time Biotech requires more funding Importance of shared infrastructure Specialized management is crucial Rationale

18. The New Bio-incubator Scheme 2 public bio-incubators will be established Duration: 3 years Funding per project: $1.8 million Government participation: Year 1 - 85% Year 2 - 75% Year 3 - 65%

19. The New Bio-incubator Scheme Shared infrastructure (50% public participation) Specialized in-house auxiliary services Involvement of multinational pharma company Involvement of leading VC Strong emphasize on management

20. Bio-Link project EC funded project within FP5 Two main objectives: Information exchange and networking Stettin and validating a Co-incubation model