Israel has become a global center for biotechnology innovation. Its life sciences sector has grown substantially, translating cutting-edge research into practical applications across fields like healthcare and sustainable agriculture. This reflects a concerted effort to foster scientific discovery and technological development.
Pillars of Growth
Israel’s biotech industry is built upon a foundation of interconnected strengths. Academic institutions have consistently driven biotech research and development. These universities are vital sources of scientific talent and discoveries, fostering an innovative environment. The nation’s civilian R&D expenditures are among the largest in the OECD, accounting for 4.3% of its GDP, which further supports this robust research ecosystem.
- Weizmann Institute of Science
- Hebrew University of Jerusalem
- Technion-Israel Institute of Technology
- Tel Aviv University
- Ben Gurion University of the Negev
Government support plays a substantial role in nurturing this sector. The Israel Innovation Authority provides funding and initiatives to propel biotech companies forward. Programs like BioJerusalem offer financial incentives, including grants and tax benefits, to biotech startups. This public investment helps de-risk early-stage ventures and encourages the translation of academic research into commercial products.
A highly skilled and educated workforce, often with backgrounds in military technology, contributes significantly to Israel’s innovation capacity. Israel has one of the highest percentages of engineers globally and a high number of physicians per capita, providing a deep talent pool for the life sciences. This blend of engineering and medical expertise fosters a multidisciplinary approach that is beneficial for biotech advancements. The culture of entrepreneurship, deeply ingrained in the “Startup Nation” ethos, encourages risk-taking and the rapid development of new technologies.
A vibrant venture capital and startup ecosystem provides financial fuel for growth. Israeli life science companies have raised billions on NASDAQ, attracting significant investment. Over $2 billion in private investments flowed into Israeli life sciences companies in 2024, indicating a recovery in fundraising. This capital, coupled with incubators and accelerators, helps promising biotech ventures scale and bring innovations to market.
Frontiers of Innovation
Israel’s biotech sector leads in several specialized areas.
MedTech
In MedTech, Israel develops advanced medical devices, diagnostics, and digital health solutions. Innovations include the PillCam, the first miniature ingested camera, and advanced closed-cell stent designs from Medinol. Companies like InSightec have pioneered MR-guided Focused Ultrasound Surgery (MRgFUS), becoming a global leader.
Digital Health
Digital Health is another area where Israel excels, leveraging its strong information and communications technology sector. The integration of artificial intelligence, big data, and telemedicine is transforming healthcare delivery. Ninety-eight percent of Israel’s population has detailed electronic medical records, providing a rich data environment for developing AI-driven diagnostic tools and personalized medicine solutions. Nanox, an Israel-based company, utilizes AI to enhance early medical detection, achieving a significant IPO in 2020.
Agritech and FoodTech
Innovations in Agritech and FoodTech address global challenges in sustainable agriculture and food production, including advancements in alternative proteins and efficient farming. Aleph Farms, for instance, was the first company to produce steaks from animal cells, showcasing Israel’s approach to food security. These developments aim to create more resilient and environmentally friendly food systems.
Pharmaceuticals and Biologics
In Pharmaceuticals and Biologics, Israeli companies are active in drug discovery, new therapy development, and advanced biologics. The sector excels in biologics, vaccines, and cell therapies. Early successes include InterPharm, founded in 1978, which developed recombinant cytokines for treating viral infections, cancer, and autoimmune diseases. Bio-Technology General received marketing authorization for recombinant human growth hormone in 1988.
International Reach and Influence
Israel’s biotech sector maintains extensive international collaborations. Global pharmaceutical companies, research institutions, and investment firms actively engage with Israeli entities. Multinational giants like Pfizer, Takeda, Merck, Amgen, Philips, GE, Boston Scientific, and Johnson & Johnson have established R&D centers and startup incubators in Israel. These partnerships facilitate the co-development of new therapies and technologies, particularly in AI-driven drug discovery.
The sector also attracts significant foreign investment, underscoring its global appeal. While foreign investment decreased in 2023 compared to 2022, investors continue to support the Israeli life science sector. Ventures like AION Labs, a collaboration involving AstraZeneca, Merck, Pfizer, Teva, and the Israel Innovation Authority, highlight the commitment of global players to leverage Israeli expertise in computational biology for drug development.
The export of Israeli biotech solutions and technologies demonstrates the industry’s global impact. In 2016, life sciences exports from Israel reached $6.9 billion, showcasing the country’s leadership. This export activity includes medical devices, digital health platforms, and pharmaceutical products that address global health needs. The Israel Advanced Technology Industries Association (IATI) actively promotes Israeli biomed companies internationally.
Israeli biotech also contributes to addressing global health and environmental challenges. New initiatives, such as a biochip and smart sensor technology lab with a $29.6 million investment, aim to provide solutions for medical diagnostics, environmental rehabilitation, and energy generation from waste. This lab integrates biology, engineering, and AI to develop innovations that can purify contaminated water, detect diseases, and cultivate food in harsh conditions. Such advancements highlight Israel’s role in developing globally relevant solutions.