Q&A: The state of healthcare innovation in Israel

Eli Levin, who works on economic affairs and innovation for the Consulate General of Israel to New England, discusses how the war in Israel has affected digital health and technology.
By Jessica Hagen
01:13 pm

Photo courtesy of Eli Levin

Israel has long been a hub for healthcare innovation. Since the war began in early October, many of the country's high-skilled tech workers have been recruited by the military. The startup landscape has changed, and companies are struggling to retain the traction they once had in furthering their innovations and garnering investment, says Eli Levin, who works on economic affairs and innovation for the Consulate General of Israel to New England. 

Levin sat down with MobiHealthNews to discuss the state of healthcare innovation in Israel. Here is what he had to say:

The impact of conflict on healthcare innovation 

The first immediate impact on the technology companies in Israel is the workforce. About 360,000 Israelis have been called up to duty to serve at the reserve units, and a big portion of them are tech employees. 

An estimation, we are talking about 10% of the tech employees in Israel that have been drafted. In some companies, the numbers can reach up to 20 or 30% of the employees. 

So, of course, because of the war and this really unprecedented emergency situation that we all got into, unfortunately, a little bit more than two weeks ago, different technology events and conferences that are supposed to take place in Israel have been postponed, and different visits of investors and other VCs.


Ongoing business efforts and collaboration are also a little bit on hold at the moment. But at the same time, there is tremendous support and assistance from, if you're talking about the healthcare industry, all kinds of U.S. healthcare corporations and business partners. 

For example, Israeli hospitals have a really diverse and significant network of partners. Some of them are medical institutions and healthcare systems, and some of them are investors, private equity, VCs – all are offering their support, whether it's financial support, like funding for the startups that are part of the portfolio of the hospitals. Most of the Israeli hospitals have a portfolio of innovation hubs like startups in medical devices, digital health, and other health tech projects and technologies.

Assisting startups

I think the first sign of support and help and assistance is funding and financial aid and support, especially the early-stage startups in Israel. They are more vulnerable to uncertainty in the market, because they need ongoing support, ongoing investment. 

So, first of all, you have the financial support-help those companies stay in business and continue to raise money. 

Second, there is the Israeli government with the Israeli Innovation Authority. They launched a safety funding net of $25 million, especially helping the early-stage startups, as we said they are the most vulnerable ones. I just saw that they increased the amount. They are all the time thinking about how they can help those startups. 

So this is another example of how the Israeli government is engaging in supporting the companies. The business sector, the technology industries in Israel, is in charge of like 18% of Israel's GDP and almost half of our exports. So, it's a significant amount of workforce and contribution to the Israeli economy from Israeli startups. 

Startups' participation

If we go back again to the healthcare industry, this is something that maybe people are less talking about, but it's also very important. 

Many people in Israel in different locations are feeling really afraid and unsafe, and that causes people to take all kinds of, or to consider taking some psychological treatments. 

Here, the Israeli health tech and digital health and medical technology startups are entering this vacuum, and they are offering their products to help the Israeli people, the Israeli public, deal and cope with anxiety and depression and especially mental health problems that have increased dramatically in the last almost 20 days. 

There are multiple companies, technology startups, technology companies that are developing all kinds of products and solutions in those areas to help people in need who suffer from anxiety, depression and mental health issues.

The war's impact on innovation

In my perspective at the consulate, since I'm in charge of innovation and economic affairs, I really try to focus, first of all, on learning about the impact of the war on the business sector. Of course, as I've mentioned, there are all kinds of expressions of how this tech industry in Israel and outside of Israel has been impacted and affected. 

One needs to remember that we used to say that our ecosystem is really resilient. 

Business is and the economy is going on. Things are going forward. Of course, the main challenge is to keep the money flowing and the investment flowing. And, of course, now it's on a different level. Not surprising, but still, the economy is going forward. And still the companies are working, and still people are continuing to develop all kinds of technology and innovations.

The global business community

I think, moreover, the international collaborations that Israeli startups are having with the international business community will only be strengthened. 

They also see the business and tech industry is going through significant changes, and people want to help, especially all kinds of investors and medical institutions and all kinds of business partners in the healthcare industry that work with Israeli hospitals or with Israeli healthcare companies, and some of them are proactively suggesting funding opportunities and safety nets, and even if it's like strategic business advice, even if it's like on a more basic level like emergency funding, strategic advice, global resources. 

We have more than 450 multinational corporations with operations in Israel, mainly in the research and development sectors, some of them in the health tech and healthcare industries. Most of them are in Israel. They didn't take out their employees. They didn't bring them back to their countries. It's also a show of solidarity and support, and trust in the Israeli economy. And, despite all of those, the last 20 days have greatly impacted the Israeli economy.

Anticipating the future of health tech in Israel

The level of investment in technology in Israeli companies in the last few years has been a little bit decreased, but it's still one of the leading and attractive destinations worldwide for investment in technology and innovation. I think it says it all.

But, despite having to cope and deal with uncertainties, we still manage to maintain our innovation, our technology and our startup ecosystem. We're trying to build out our global partnerships and strengthen them as much as we can, and create new ones. So I think it's a very difficult and rough period, but I'm sure that the tech sector as a whole will grow, will become stronger, will gain new partners. And I also think that companies and startups will get the funding that they need, even if it will take more time than they thought it would take.