To help businesses overcome any number of hurdles in the health tech sector, including the likes of regulatory requirements, clinical trials, and investment, Callaghan Innovation has launched a HealthTech Activator.
Callaghan Innovation has launched a HealthTech Activator (HTA) to support commercialisation in New Zealand’s healthtech sector, which generated an estimated $2.85 billion revenue last financial year, with many healthtech companies achieving record growth since COVID-19 struck.
Healthtech represents significant economic potential for New Zealand, with businesses such as Fisher & Paykel Healthcare, valued at $20b in June 2020, demonstrating what’s possible in the market. Exports made up 87.5 percent of all NZ healthtech revenue in 2019, and there are 4,296 people employed in the sector.
New Zealand’s largest healthtech businesses have performed well over the last financial year, with Fisher & Paykel Healthcare alone recording $1.97 billion revenue, and Volpara recently announcing a record revenue of just under $20m. However, healthtech innovators and startups are often stalled by sector-specific challenges.
Healthtech overview
According to recent research by Callaghan Innovation, these include complicated clinical trial regimes, complex regulatory requirements, and difficulties accessing investment and educational support.
Callaghan Innovation Head of Health Technology, Andrew Clews, says that for New Zealand healthtech to meet its full potential, innovators must be supported to overcome these challenges.
“While the New Zealand healthtech sector is in a fast growth phase, in part driven by COVID-19, our research found there are many hurdles for companies to overcome,” says Clews. “The road to take a healthtech product to market can be time-consuming, expensive, and difficult for new companies to wrap their heads around.”
Andrew Clews, Head of HealthTech, Callaghan Innovation
The HTA has been created to help companies navigate these challenges, and to ensure that Kiwi healthtech continues to go from strength to strength. This aligns with the vision of the NZ Health Research Strategy for the country to have a world-leading health research and innovation system by 2027.
“New Zealand healthtech must be global in its outlook to ensure it’s maximising market opportunities,” says Clews. “However, each country has different regulatory requirements and reimbursement processes and understanding these can be challenging for healthtech innovators wanting to expand beyond New Zealand.”
There is also potential to establish better trial opportunities in New Zealand. A recent report by the NZ Productivity Commission found that opportunities are limited for healthtech firms to collaborate with District Health Boards (DHBs) to trial and develop innovative new products and services.
“Healthtech innovators need to be well connected to experts and investors to succeed in this space. The current DHB structure was a concern for us, as healthtech companies need a lot of support early on to get off the ground due to the complex road to market,” says Clews.
“The complexity of healthtech, and the longer return on investment timeframe means the sector appeals to only a limited group of investors. In some cases, market entry can take up to 10 years,” says Clews. “There is also a higher risk that the product will not meet regulatory requirements, and there can be higher capital needs than other sectors.”
Healthtech challenges
The HTA website provides ecosystem and funding maps with focused areas of support in market validation, capital education, reimbursement strategies, regulatory planning, and clinical trials – five key areas identified by the HTA as those where support could help accelerate the ecosystem.
“The HTA aims to address these challenges by offering a low-cost avenue for healthtech companies to access the kind of support they need to navigate them,” says Clews. “We want to ensure a future where New Zealand healthtech is meeting its full potential as a multi-billion dollar export industry, creating high-value employment and revenue for Kiwis, while addressing some of the most pressing healthtech challenges of our time.”
About the HealthTech Activator:
The HealthTech Activator is a coordinated, ecosystem-wide support mechanism for early-stage founders and companies in New Zealand's healthtech sector.
The Activator makes it easier for healthtech companies to find and access the support they need to turn their health innovations into successful businesses. In doing so, it aims to advance, de-risk and accelerate the commercialisation of innovation in New Zealand’s healthtech ecosystem.
www.hta.callaghaninnovation.govt.nz
About Callaghan Innovation:
Callaghan Innovation is New Zealand’s innovation agency. It activates innovation and helps businesses grow faster for a better New Zealand.
The government agency partners with ambitious businesses of all sizes, delivering a range of innovation and research and development (R&D) services to suit each stage of their growth. Its staff – including more than 200 of New Zealand’s leading scientists and engineers – empower innovators by connecting people, opportunities and networks, and providing tailored technical solutions, skills and capability development programmes, and grants co-funding.
Callaghan Innovation also enhances the operation of New Zealand’s innovation ecosystem, working closely with MBIE, NZTE, NZVIF, Crown Research Institutes, and other organisations that help increase business investment in R&D and innovation. The agency operates from five urban offices and a regional partner network in a further 12 locations across Aotearoa.
What is healthtech?
Health technology or healthtech is defined by the World Health Organization as the "application of organised knowledge and skills in the form of devices, medicines, vaccines, procedures, and systems developed to solve a health problem and improve quality of lives."
This includes pharmaceuticals, devices, procedures, and organisational systems used in the healthcare industry, as well as computer-supported information systems.
The NZ Vision for Health Technology states that technology is revolutionising health systems. Robots and other automated systems are carrying out repetitive and predictable processes, advanced analytics are providing new insights into complex health problems, and research breakthroughs in human science are making ‘personalised medicine’ a reality for more and more people.
