Practical guidance for startup-nation entrepreneurs

Israel’s first-ever Center for Digital Innovation has opened in Beersheba, bringing outside experts to teach innovators how to prepare their medical technologies and break into the US market.

By JUDY SIEGEL-ITZKOVICH
Updated: SEPTEMBER 6, 2015 02:50
Electro-optic technology [illustrative] (photo credit: REUTERS)
Electro-optic technology [illustrative]
(photo credit: REUTERS)
Talented residents of the “startup nation” excel at thinking unconventionally and taking risks, but are less successful developing their products and selling them abroad. Now, a number of experts in healthcare, “smart cities” that use digital technologies, education and social welfare are volunteering to help Israeli entrepreneurs take their product to the US and other foreign markets.
A week ago, several of them launched the non-profit Center for Digital Innovation (CDI-Negev) in Beersheba – with help from Ben-Gurion University of the Negev, private investors and international companies – for this exact purpose. It is the first innovation center of its kind in the capital of the Negev, and its first major focus will be on medical technologies.
Beersheba is developing into Israel’s innovation capital, and the launching of the 2,000 sq.m. CDI in the Gav-Yam industrial park is boosting this even more.
One of the center’s founders is Ziv Ofek, the co-founder and chief technology officer of dbMotion, a company he has since sold that dealt with medical informatics and advanced applications and tools for coordinated healthcare and population management.
Before that, Ofek was vice president for research and development at Ness-ISI, a subsidiary of Ness Technologies, whose products are used by the two largest government medical centers and Clalit Health Services.
“In an era in which technologies and challenges pop up and change in front of our eyes on a daily basis, the best way to predict the future is to create it. Innovation is needed for creating and leading. Israel, the ‘startup nation,’ has many brilliant minds and excellent entrepreneurs who need new models for support throughout their journey fraught obstacles and challenges. For the first time,” said Ofek, “CDI will create a holistic environment under one roof with all the needed elements for entrepreneurs during their complicated voyage, and everything is personalized for each startup’s needs. We believe that out of CDI will emanate breakthrough technologies that will improve the lives of millions of people here and in the world and speed up the development of local industry and Beersheba and the Negev.”
Beersheba Mayor Ruvik Danilovich said that “CDI will cerate the future. It is an important and central part of the vision of turning this city and the Negev into the most attractive metropolis in Israel and a center in international knowhow that will give an equal chance to all those big dreamers who push a breakthrough idea.”
BGU president Prof. Rivka Carmi, who will serve as chairman of CDI’s board of directors, added that her university “encourages breakthrough research in the fields of medicine and science. As part of our contribution to the country’s and the Negev’s scientific development, we decided to establish with entrepreneurs and partners from here and abroad what will be the first innovation center of its kind in the world.”
OFEK WAS joined at CDI by Charles (“Chip”) Kahn III, the president and chief executive officer since 2001 of the Federation of American Hospitals (FAH), whose member companies own nearly 20 percent of all American hospital beds. Kahn and the FAH represent their for-profit hospital investors on health policy issues like healthcare reform and the improvement of hospital treatment.
In an interview with The Jerusalem Post before a few days before the CDI launch ceremony, Kahn said he had been to Israel “many times” and was very familiar with its business and health sectors.

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“I was born and grew up in a Jewish family in New Orleans, Louisiana. My father, Charles N. Kahn II, is a retired engineer and my mother, Felicia, is active in local and state politics,” he said.
Khan received a bachelor’s degree in social and behavioral sciences from The Johns Hopkins University in Baltimore and a masters of public health degree from Tulane University School of Public Health and Tropical Medicine in the city of his birth. After graduating, Kahn completed an administrative residency with the teaching hospital department of the Association of American Medical Colleges. He then served the Office of Financial Management Education at the Association of University Programs.
Active in politician campaigns since he went to high school, Kahn was a health policy adviser to a variety of politicians who became mayors, governors and members of the US House of Representatives and Senate.
He was active in the Clinton administration’s health-reform initiative and the current administration’s Obamacare effort.
“President Obama’s health reform was very successful in some places, especially where it was allowed to be completely implemented. In California, for example, Obamacare reduced the number of uninsured to below 11 percent. But in other states, where the majority are well off and don’t want to expand coverage for the poor, it has a higher percentage of people without health coverage.”
Kahn is also a founder of the Hospital Quality Alliance, a private/public partnership aimed at improving US hospitals.
As head of FAH, he is recognized and respected throughout the US as one of its most insightful and articulate experts on health policy, Medicare payment, healthcare financing and health coverage and is regarded as one of America’s most effective and accomplished trade association executives.
“CDI WILL be an active center for startup entrepreneurs and investors at all phases of the development of their ideas until they are brought to market – especially in the US,” said Kahn. “Among the available services will be digital labs, access to databases, workspaces, connections to leading medical centers in Israel, a lab for technological simulation and integration and the world and international beta sites for examining technological feasibility.”
He added that the center offers a unique program for penetrating international markets, regulatory help, thinking groups and access to experts, researchers, academics, veteran entrepreneurs and R& D people.
“These have all created an unique entrepreneur ecosystem in Beersheba, the capital of the Negev.”
Suppose you’re touring a picturesque European village and need medical treatment.
With digital health, he explained, “a doctor could call up your whole medical history from Israel by pressing a key. In another five years, will we not see a family physician more than once a year because we will get all our medical services via the Internet? How will we be sure that our private details are secure and that no bunch of anonymous hackers will know about the abortion we had a decade ago, or [that we] had treatment for hemorrhoids? Will we be able to reduce the morbidity and mortality rates from taking medications improperly or from a doctor’s wrong diagnosis? “Will we be able to follow in real time what our elderly parents are doing and whether we have to worry after they failed to answer a telephone call? All these will be only a small part of the digital health revolution, one of the hottest fields in medicine and venture capital.”
“The idea of the center is very exciting – to help entrepreneurs with great ideas, most of them digitally based, to get their business act together and perfect their solutions,” Kahn said. “The center has received no help from the government. I am on CDI’s advisory council, as I come from the US and have many years of experience.”
THE FAH executive is aware of the fact that in general, Israeli healthcare is much more efficient and inexpensive compared to that in the US.
“I was very involved in health reform and Obamacare. There are differences [between Israel and the US] in the way care is delivered and...one can learn from them. In Israel, the four health funds are not identical.
There are differences, however, but also commonalities between the American and Israeli systems. Besides financing, and basket of benefits, the question is how care is provided.”
In the US, he noted, younger doctors have gotten used to the idea of being employees rather than self employed. “Medical specialists generally have their own independent practices, which explains why treatment is so expensive. But the entrepreneurial medical system is ending.”
“The US – as well as Europe – is ready for new solutions to medical care. That’s why there is such promise for places like CDI, because there’s a new world for startups involved in ‘big data’ in medicine. Telemedicine from afar is only part of it. We will be able to understand patients and their conditions and needs better. Israel’s health funds are very advanced on electronic health records. These innovations can be exported, and algorithms can be used to figure out what is the best way to deal with the individual patient. We are living at a very exciting point in the development of medicine.”
The treatment of cancer involves not only giving certain molecules for treatment, continued Kahn, but using biological treatments and personalized medicine suited to the patient. “With huge computer capacity, we can use big data to conduct research and implement discoveries quickly. One US company, for example, uses a large database for nursing home services for Medicare.
The medical records from admission to discharge are on file, and software can predict which nursing home would offer the best outcomes for the individual patient. There is much more accountability.”
Israelis, with their great ideas in healthcare, “have to go global. There is no alternative,” Kahn stressed.
Asked about the anti-Israel Boycott, Divestment and Sanctions (BDS) movement abroad and whether it could stymie CDI, Kahn said he didn’t think it would.
“BDS is political correctness gone out of hand. There is a very insular market in the US. BDS affects some universities, but I don’t see it as affecting the healthcare market. If we can help Israeli startups to mature, can make them competitive and demonstrate in the US that what they offer is successful, the products will speak for themselves.”
Asked to give examples, Kahn mentioned an Israeli startup that makes monitors attached to under the beds of patients in non-intensive-care units for continuous monitoring. Nurses can follow their conditions without leaving their stations and deal with sudden changes.
“There are so many possibilities, some to benefit the patient and others to help the doctors and nurses. Medication management is also a big field aimed at ensuring that patients receive and take the right prescriptions in the hospital and at home. There is technology that keeps track of them.”
The hospital expert concludes: “The best ideas on medicine are here, and the potential is limitless.”