Market Overview
With the largest number of start-ups per capita in the world, Israel is an inimitable center of innovation. In fact, in 2020, Israeli high-tech companies raised $10.5B in capital, up 20% from 2019, compared to 5% and 1% for companies in the USA and Europe, respectively. Spending 4.9% of its gross domestic product on research and development (R&D) in 2019 – the highest ratio worldwide – Israel consistently ranks as one of the most innovative countries in the world, placing 7th in the 2021 annual Bloomberg Innovation Index.
Medical device and digital health technologies comprise a large proportion of the approximately 1,600 active life science companies in Israel. The life science sector received $1.5B in funding in 2018 from national and foreign venture capital funds, strategic and private investors, and governmental grants. A key strength of the Israeli life sciences industry is the cooperative infrastructure that allows academics, tech transfer offices, incubators and accelerators, and pharma companies/corporates to operate as a tight network to drive translational innovation. Specifically, the Israel Innovation Authority, an independent publicly funded agency, nurtures this ecosystem by supporting all stages of entrepreneurship from translation of academic work to foreign market expansion. The Authority funded 1,650 R&D projects in 2019, with life sciences receiving the lion’s share.
Over 60 Israeli companies currently operate in the ophthalmology space. The 10 companies highlighted in the OIS Israel Ophthalmic Innovation Showcase address a gamut of eye diseases including retinal disease, glaucoma, presbyopia, amblyopia, and corneal disease. Their devices and therapies are a prime example of scientific excellence and the Israeli entrepreneurial mindset. In this report, we delve deeper into their innovations in the context of their leading indications. Click on the links in this report to watch the recorded presentations from the 2nd annual Israel Ophthalmic Innovation Showcase.
Retinal Disease
The retina of the eye detects light and converts it into electrical impulses that the brain interprets and perceives as vision. Retinal damage can result in severe visual loss and, even, blindness. Globally, nearly 200 million people are affected by retinal degenerative diseases, including age-related macular degeneration (AMD), inherited retinal disease, or diabetic retinopathy.
Gene therapy has shown incredible promise in treating retinal degeneration, with the current approved therapy injected subretinally. However, the suprachoroidal approach is gaining traction as it is less invasive, circumvents the need for a vitrectomy, delivers high bioavailability in the posterior eye, and minimizes anterior segment side effects. The prototype suprachoroidal delivery system developed by Everads Therapy injects the therapeutic agent (cell, gene, or biologic) between the choroid and sclera (outside) of the eye, providing long-term therapeutic effect and improving patient compliance and outcomes. Established in 2017, Everads Therapy operates out of the RAD BioMed incubator. In March 2020, the company entered into a time-limited exclusive option agreement with a global pharmaceutical company to utilize their system for the development of specific ocular targets, demonstrating the incredible potential of this technology. Everads Therapy retain the ability to use and/or license this system to other parties for the development of targeted therapies not reserved under the collaboration.
ELGAN Pharma, on the other hand, are leveraging their neonatal expertise to treat retinopathy of prematurity (ROP) – a potentially blinding disease affecting premature infants weighing 1,250 grams or less, born before 32 weeks of gestation. Growth and leakage of abnormal blood vessels is characteristic of ROP, leading to scarring resulting in retinal detachment. Although premature births comprise 12% of all births, they consume 60% of birth-associated costs. As infant survival rates increase, continued improvements are needed in preterm infant outcome and quality of life. Current treatments, including laser therapy or anti-VEGF injections, are only used in advanced cases, as they may compromise long-term vision. ELGAN Pharma have developed ELGN-2232, locally administered eye drops containing compounds that prevent retinopathy-induced visual impairment by, both, stimulating normal blood vessel development and inhibiting disease progression. The novel tailored nanoemulsion formulation (composed of infant-approved substances) is currently in phase 1 trials after showing compelling safety and efficacy in preclinical studies. The company is currently raising funds to work towards initiating phase 2 trials.
Glaucoma and Ocular Hypertension
Glaucoma is a leading cause of blindness worldwide, affecting more than 80 million people ($7B market), and occurs when the optic nerve is progressively damaged. The resulting vision loss begins in the periphery, sometimes, going unnoticed until more severe damage affects central vision. Though treatments can minimize vision loss, glaucomatous changes are irreversible. As such, early detection, diagnosis, and treatment are key. Elevated intraocular pressure (IOP), associated with improper fluid drainage within the eye, is the only risk factor that can be addressed today, starting with medications, and progressing to more invasive procedures such as laser surgery, minimally invasive glaucoma surgery (MIGS), drainage implants, or filtration surgery.
Ophthalmic Sciences has developed the first image processing-based, non-contact IOP measuring device called IOPerfect™, which allows frequent, self-administered IOP measurements without hospital or clinic visits, performed under 3 minutes. Controlled air pressure applied within a VR headset-like product worn by the patient, causes differential vascular responses in iridial (internal) and scleral (external) blood vessels that are captured and analyzed by an AI algorithm to determine IOP. Results are immediately sent to the clinician, thereby sparing patient and physician time and associated clinic, hospital, and telehealth provider costs. Established in 2019, the company operates within the eHealth Ventures incubator and raised $850k in a pre-seed round. A pilot clinical trial began recruitment in Jan 2021 and pivotal studies are planned for later in the year, aiming to obtain FDA approval and the CE mark in 2022. The company also plan to leverage their platform for the early detection/identification of cataract, corneal edema, ocular motor disorders, and central/branch vascular occlusions.
Although IOP-lowering medications remain first-line treatment, BELKIN Laser’s direct selective laser trabeculoplasty (DSLT) Eagle (external automatic glaucoma laser) device improves upon the current gold standard SLT therapy by significantly shortening the duration during which the laser beam targets the trabecular meshwork (drainage system of the eye). Using a camera-guided system to enable a non-contact procedure, it employs eye tracking and advanced image processing algorithms to locate the precise treatment area. Due to the ease of performing this procedure, the company believe that the treatment can be administered by any eyecare provider, compared to SLT which is performed by glaucoma specialists. Having raised a Series B round of $12.3M, the device is currently in a multicenter pivotal trial (GLAUrious) with estimated completion in 2022, aiming to secure the CE mark followed by FDA approval. As the device also treats angle closure glaucoma, highly prevalent in East Asian populations, the company hope to commercialize in the Asian market by 2023.
Targeting patients who are unable to control IOP with medication or laser therapy, Sanoculis have extended surgical options with the minimally invasive micro sclerostomy (MIMS) procedure, an alternative to MIGS. IOP is reduced by drilling a corneoscleral drainage channel, extracting the tissue cylinder, and allowing fluid outflow into the subconjunctival space. The surgery remains implant-, stent-, and stitches-free, leaving future therapeutic options open. There is also minimal trauma and scar tissue formation, which are often the main obstacles in maintaining IOP control post-surgery. The procedure is simple, operable by a range of ophthalmologists, cost-effective, suitable for most glaucoma patients, medication-sparing, and can be performed within 2 minutes. The MIMS device and procedure received a CE mark in 2017 (amendment expected in 2020) and has gone through first-in-human studies, demonstrating long-term reduction in IOP as well as medication usage. The company aim to begin pivotal studies in 2021, supported by a Series C funding round, and intend to file for FDA registration via the De-Novo route.
Corneal Disease
The cornea is the transparent barrier between the eye and the outside world, providing 70% of its refractive power. Corneal damage compromises its barrier function and can also lead to vision loss, necessitating corneal transplantation. Worldwide, 30 million people are legally blind in one or both eyes from corneal injury and disease; however, there is a severe shortage of donor cornea, with only 1 available for every 70 needed.
CorNeat Vision addresses this unmet need with the CorNeat KPro artificial cornea. Made from a 100% synthetic, non-degradable, porous material resembling the extracellular matrix (ECM), it is implanted during a 45-minute procedure and integrates completely with the eye wall, under the conjunctiva, whereby ECM-producing cells and ECM components colonize the material. The CorNeat KPro is a scalable and affordable substitute to the human cornea that replicates corneal optics to deliver excellent visual performance, offers quicker healing than human corneal transplantations, evades severe immune responses, and allows subsequent eye surgeries through built-in openings (e.g., cataract removal or retinal surgeries). Following a Series B round of $3.4M, the CorNeat KPro is currently in multicenter clinical trials, hoping to obtain FDA clearance, the CE mark, as well as NMPA approval in China. The company expect initial clinical results in 2021 and anticipate a significant funding round to take them through to exit. CorNeat Vision have also leveraged their platform for the CorNeat EverPatch (scleral patch), which can be used to conceal glaucoma drainage devices, cover suture knots, and bridge tissue gaps, thereby replacing the use of human tissue and degradable collagen patches, and the CorNeat eShunt, the first bio-integrating glaucoma shunt, which regulates IOP by mimicking the trabecular mesh and draining deep in the orbit. The EverPatch is currently in first-in-human trials with a view to obtaining the CE mark during 2021 and then extending into the US market.
Alternatively, Precise Bio’s approach involves ‘4-D-printing’ bio-fabricated cornea from the patient’s own cells. Their printing platform is the first to control, both, resolution (single cell) and precise spatial positioning. Patient cells are harvested, expanded in culture, and combined with ‘bio-ink’ (composite material including ECM, growth factors, and crosslinking materials) in a process called bio-fabrication. Layers of cells and bio-ink are then deposited, cured, and matured into corneal tissue with the correct morphology, functionality, and integrity before being shipped for transplantation. They hope to initiate clinical trials in 2021 and are open to partnering with biotechnology and tissue engineering companies that share their mission of making transplantable organs and tissues readily available and commercially viable. The company’s platform allows them to generate complex tissues in a highly reproducible and scalable manner, providing the foundation for pipeline development into various indications.
Presbyopia
As we age, the natural lens loses its ability to focus on nearby objects, resulting in blurred vision when reading, often forcing the reader to hold things further away. This condition, known as presbyopia, mostly occurs after the age of 40 and affects almost 2 billion people globally. Treatments include eyeglasses, contact lenses, refractive surgery, corneal inlays, or intraocular lenses, which can often be cumbersome and/or invasive. With a growing aging population, improving quality of life for those with presbyopia represents an unmet need.
Orasis Pharmaceuticals are developing a first-in-class eye drop formulation, CSF-1, a proprietary combination of a miotic and parasympathomimetic, which constrict the pupil to create a ‘pinhole’ effect, and a non-steroidal anti-inflammatory, which prevents discomfort due to constriction and minimizes the risk of uveitis. Together, these agents increase near visual acuity. CSF-1 is easy to use, fast-acting, more amenable to those with an active lifestyle, and preservative-free (spares the ocular surface and better option for dry eye patients). It demonstrated an exceptional safety and tolerability profile while significantly improving near visual acuity in phase 2b trials. A $30M Series C round is funding two pivotal studies, initiated in Oct 2020, and pre-commercialization activities ahead of product launch.
Amblyopia
Amblyopia begins in childhood while visual development is ongoing. If vision is hindered in any way, e.g., strabismus, lens clouding, or differences in visual acuity, the brain preferentially relies on the less affected, stronger eye, leading to poor development of the weaker eye. Amblyopia prevalence ranges from approximately 1-3% in different populations. Left untreated, amblyopia has long-term impacts on the child’s development including visual disorientation and, potentially, vision loss. The gold standard treatment, ‘patching’, involves covering the stronger eye, and forcing the brain to use and strengthen the weaker eye; however, it suffers from low compliance.
NovaSight has developed the CureSight amblyopia treatment, which relies on eye tracking and cloud-based data analytics. By leveraging their CE-marked and FDA-registered portable EyeSwift® visual assessment system, which tracks eye movements and performs 11 different vision exams, together with the ActiveSight™ active shutter glasses, CureSight is an alternative to patching. It can be operated by any eyecare provider or staff member, requires minimal patient cooperation, and provides treatment monitoring and reports. The system tracks and moves the center of vision for each eye while the child watches their choice of content. Real-time image processing then blurs the center of vision for the dominant eye, keeping the rest of the image sharp, and allows the amblyopic eye to see the entire image clearly. This encourages the latter to complete the image, while also developing stereo acuity. Preliminary clinical results demonstrate significant improvement in visual acuity and stereo acuity using CureSight, compared to patching, with 95% compliance. The EyeSwift® system can also be used for prediction and monitoring of vision and neurological conditions through detection of abnormal eye movement patterns. In 2020, NovaSight raised an $8M Series A round to support a pivotal study for CureSight aimed at achieving FDA clearance.
Digital Health
Currently, smart ocular devices, and indeed other digital and wearable health technologies, utilize an external power unit or battery which requires the user to wear it or be in its proximity. Therefore, patient compliance is key to collecting useable data.
BLINK Energy want to address this market gap by harvesting energy from blinking, an involuntary activity performed approximately 18,000 times a day (including eye movements and REM sleep), to power wireless charging. Their ocular unit consists of a power and communication relay unit, in the form of a wearable contact lens, and an ergonomic, disposable eyelid patch, which supplies power to the relay unit for any Internet of Things (IoT). Key features include a constant and independent power supply, the ability to integrate to wearable and implantable ocular devices (e.g., IOP or glucose sensors), wireless transmission allowing data to be managed and saved 24/7 in an app or cloud-based server, and adaptable online monitoring for telemedicine. Established in 2015, BLINK Energy were admitted into the MindUp digital health incubator to prove feasibility and initiate proof-of-concept studies. They hope to raise $5M to realize product development within 3 years. The device has huge potential for co-operation with several key players who are already innovating in vision care and recreation, which may benefit further from their technologies being free from external charging or batteries.
Innovation Case studies
Israel’s innovative ecosystem centers around its unique collaborative nature. Moderated by Suzana Nahum Zilberberg, vice-chair of Bio-Light Life Sciences Ltd and co-founder of iL.factor, the OIS Israel Innovation Showcase demonstrated the strengths and benefits of this ecosystem through three case studies highlighting partnership between the Israeli industry, its stakeholders, key opinion leaders, and investors.
Industry Case Study
Zack Dvey-Aharon, PhD, co-founder and CEO of AEYE Health described the company’s best-in-class artificial intelligence (AI)-based camera-agnostic platform which provides diagnostic screening services. It has exceptional sensitivity and specificity for diagnostic screening of DR, provides broader screening solutions for 12 sight-threatening and/or systemic indications, and works across hand-held, smartphone, and small desktop screens. The platform can be used by primary care physicians/retail pharmacists/elderly care centers to screen patients, receive reimbursement, and refer those with suspicious findings. The technology received an AI reimbursement code (USA) and boosts the Health Effectiveness Data and Information Set (HEDIS) score. Moving forward, the company have strategic vertical partnerships with camera manufacturers, pharma companies, healthcare providers, and insurance companies.
As a healthcare provider, Notal Vision’s ForeseeHome™ engages and provides remote diagnostic monitoring services to detect intermediate dry to wet AMD conversion. Kester Nahen, CEO, then showcased the Home optical coherence tomography (OCT) pipeline technology for monitoring wet AMD patients, currently supporting several pharma-sponsored clinical trials, and the AI-based Notal OCT Analyzer, which localizes and quantifies nanoliter-resolution retinal fluid. Given that patients diagnosed at functional vision maintain their vision long-term with continuing treatment, these remote technologies fill the gaps between routine clinic visits allowing early disease detection and improve patient engagement. The Home OCT entered pivotal trials and is expected to receive reimbursement in 2021, with FDA approval in 2022.
Both AEYE Health and Notal Vision are disruptors to the clinic-based eyecare model. Zack and Kester highlighted the need for market education with disruptive technologies, engaging early and often with stakeholders/medical societies and building trusting relationships to ensure technologies address clinical need. Both companies have astutely positioned themselves as specialist/primary care physician/retail pharmacy support and co-management options, alleviating burden rather than becoming replacements. Their take-home message – “Reimbursement is key”, i.e., technologies need to fit the physician’s business case to accelerate adoption.
Industry/KOL Case Study
A prime example of industry cross-pollination, Beyeonics Surgical utilizes its expertise and maturity in the aerospace field to develop high-end surgical augmented reality visualization solutions. Ron Schneider, CEO, demonstrated how the platform incorporates ergonomic head-mounted displays as a digital extension of the ophthalmologist, providing ultra-resolution 3-D imaging, integrating diagnostic and real-time data in the visual field, and delivering an intuitive user experience with easy-to-learn head gestures. With a virtual screen that moves with the surgeon, the system broadcasts to three screens simultaneously for increased communication and synchronization between staff in the operating theatre (OR). Additional product features include high-speed 4-D intraoperative OCT, inner/epiretinal limiting membrane (ILM/ERM) color enhancement during surgery, and a phaco/virtual reality viewer allowing real-time visualization of OR instrumentation data.
Ron articulated the inherent challenge in Israel’s unique ability to translate tried and tested defense technology into medical applications – accounting for new customer specifications and needs. In this regard, creative and visionary key opinion leaders are crucial to the company’s success. Dr. Anat Loewenstein, Chair, Department of Ophthalmology, Vice Dean of the Faculty of Medicine, at Tel Aviv University echoed these sentiments, noting that mutual collaboration and patience were key to advancing a clinically valuable product. Speaking to the market’s voracious appetite for digital technology, she stated, “There is no way back, we are going digital in the OR”. Surgical transformation, imminent with the adoption of digital solutions, hinges on continued dialogue and cooperation between entrepreneurs and the customer base they intend to serve.
Industry/Investor Case Study
Nahum Ferera, the CEO and co-founder of EyeYon Medical, spoke about the EndoArt implant which treats the root cause of corneal edema by replacing the defective corneal endothelium with an optically clear, synthetic, and flexible substitute. Demonstrating excellent adhesion to the posterior cornea in ongoing first-in-human studies, the implant restored normal corneal thickness and delivered significant improvements in visual acuity. The implant boasts several unique advantages including global availability, procedure simplicity, scalability, excellent shelf-life compared to donor cornea, and industrial repurposing for treatment indications including refractive error, drug delivery capabilities, ultraviolet blocking, and keratoconus. As the only ophthalmology company to receive both FDA breakthrough device designation and NMPA fast track priority, EndoArt fulfils an unmet need. The implant was recently CE approved and will soon enter pivotal trials, aiming for FDA approval.
Having also raised an oversubscribed $26M Series C round, virtually, over the past year, Nahum, and Michal Geva, co-founder and managing partner at Triventures, provided timely insight into partnerships between industry and Israeli investors. Michal highlighted the emerging trend of strategic investing by multinational corporations, i.e., directly engaging in innovation by investing in companies to produce growth of the Israeli sector. Both Nahum and Michal emphasized the validating effect that Israeli investors offer to future investors who are interested in seeing local mentorship and buy-in. The importance of cultivating relationships, outside of investment alone, with investors that can help navigate clinical, regulatory, and local or foreign market opportunities cannot be understated, particularly in building infrastructure for continued company growth.
Industry Insights on Partnering and Collaboration
“Innovation is thriving in Israel,” said Yaacov Michlin, CEO of Biolight Life Sciences, which operates as an Israeli holding company / venture capital fund focused specifically on eyecare, during a panel discussion on strategic partnerships and collaboration during the OIS Israel Innovation Showcase. “Investors and partners are coming because we have the best engineers, innovators, and entrepreneurs, plus efficiency is high and cost of development is low. Combined with the conversion of biotech and engineering in the past year, we have a winning combination.”
Begoña Carreño, PhD, Global BD&L Head, Ophthalmology, for Novartis agreed with Michlin’s assessment of the country, noting the experts’ interdisciplinary way of working as an added advantage. “You’re working with companies who have engineers, clinicians, and scientists on site, and they develop complex ideas together,” she said. “They’re a team that works seamlessly within the same company.”
Strong government support in the form of incubators and funding mechanisms provides extra incentive for Israeli innovation. Bringing science and business together, however, is an ongoing challenge.
To bridge the gap, Johnson & Johnson established four Innovation Centers with flexible deal-making capabilities and an easy-to-find point of contact. Prabhu Velusami, MD, New Venture & Transactions Lead for Vision/Ophthalmology for J&J’s London Innovation Center, encouraged innovators to approach him even pre-proof-of-concept. “You can have a nonconfidential discussion at any stage, Dr. Velusami said. “There’s value in speaking to a strategic early on because they can give you feedback, which can course correct, and ultimately save you from going down a path that may hinder you later on.”
Novartis is also open to early engagements, Dr. Carreño said. The business development and licensing group for its Institute for Biomedical Research is willing to discuss collaboration even during the university research stage.
Théa Open Innovation, the sister company of Théa Labs, takes a more focused approach. Managing director Colin Francou said the company evaluates companies with in vivo POC with clinical data.
Areas of Interest
While COVID-19 didn’t significantly affect business development, the panelists did say that digital health, remote patient monitoring, AI and other tools that promote virtual patient care have moved up in priority. Over the next five to ten years, myopia will also have a higher profile due to a serious unmet need. Dr. Velusami said myopia will require a “toolkit” approach: a combination of lenses, drops, and other treatment modalities.
Other areas of interest for Johnson & Johnson include wet and dry AMD, inherited retinal diseases, diabetic retinopathy and macular edema, and neuroprotection for glaucoma. Looking ahead, the company is interested in exploring ways to make gene therapy more advantageous.
Dr. Carreño said Novartis plans to continue to lead in retinal disease treatments. For wet AMD, it’s most interested in medicines that do not involve anti-VEGF. The company is also exploring rare disease, refractive disorders (myopia included), and digital innovation. “If you have an idea that has a clinical unmet need, please do come to us,” she said. “We have an appetite for treating the untreatable.”
Biolight is also paying attention to digital health; for example, using AI to diagnose diabetic retinopathy. “We’re focusing on innovation that, in two years, we’ll be able to bring to market,” Michlin said.
Israel-based researchers working on ophthalmologic drugs, devices, or combination products should not hesitate to reach out to investors, pharmaceutical companies and/or medical device manufacturers to start a conversation. As Michlin said, “if you find the right champion at an organization, good things can happen.”
Conclusion
In summary, the vibrant entrepreneurial and collaborative culture in Israel continues to churn out novel treatments to address unmet eye disorders. OIS has an ongoing commitment to be a platform for the Israeli ophthalmic companies and support the advancement of their technologies by facilitating awareness and interactions. Should you have interest in connecting with any of the companies or individuals featured in this report, email Craig Simak: csimak@ois.net for an introduction.