The global growth potential of New Zealand’s healthtech is huge, but innovators in this sector face increasing and tougher obstacles on the road from having a bold idea, to building a successful business.
Some of the complex challenges unique to this sector include strict regulatory requirements that differ country to country, long commercialisation pathways and higher capital needs.
Healthtech startups tend to be founded either by medical experts with little business experience, or entrepreneurs with little healthtech sector experience.
The key to building a successful healthtech business amid these challenges – and ultimately a successful, resilient healthtech industry – is a well-connected, supportive ecosystem.
To this end, in 2020, Callaghan Innovation launched the HealthTech Activator (HTA), a coordinated, ecosystem-wide support mechanism for early-stage NZ healthtech founders and businesses.
Created in partnership with key health sector stakeholders – the Consortium for Medical Device Technologies (CMDT) and MedTech CoRE with support from the Ministry of Business, Innovation and Employment (MBIE) – HTA’s mission is to de-risk and accelerate the commercialisation process for healthtech innovations. HTA does this by offering support and education in everything from clinical trials and regulatory planning to accessing funds, market validation and capital planning.
Why do we need the HTA?
New Zealand’s healthtech sector shows impressive growth potential. According to the Technology Investment Network’s (TIN) 2020 report, in 2019, healthtech firms generated $1.9 billion in revenue, accounting for 11% of our top 200 technology businesses and demonstrating a five-year compound annual growth rate of 9.1%.
In 2019, NZ healthtech businesses employed 7,636 staff here and overseas, up 15% over the previous four years. The average wage was $85,000 per annum, more than 40% higher than the NZ average.
However, there are knowledge gaps in how to access funding, particularly pre-seed funds, test the product/market fit, attract investors and find mutually beneficial collaboration opportunities with District Health Boards to trial and develop new products.
That’s where the HTA comes in. It’s a key initiative of the NZ Health Research Strategy, which set a vision that by 2027 New Zealand will have a world-leading health research and innovation system.
Who benefits from HTA?
Aimed at early-to mid-stage companies, the HTA supports healthtech businesses, regardless of whether they’re private or research-based. One business benefiting from a more connected healthtech ecosystem is startup HeartLab, which uses artificial intelligence (AI) to help in the fight against heart disease.
Co-founded by Dr Patrick Gladding and Will Hewitt, HeartLab has tapped into NZ’s healthtech ecosystem, including accessing Callaghan Innovation support, to help it with everything from business incubation, to funding, to market validation.
From the invention of the disposable syringe, to the establishment of Glaxo, which became GSK, and Fisher & Paykel Healthcare, there’s a tradition of NZ punching well above its weight in healthtech. The more of such innovators we can support through HTA, the better chance NZ has of extending that legacy into new global markets, and meeting the important goal of creating a world-leading healthtech sector by 2027.
Andrew Clews, Head of Health Technology, Callaghan Innovation.
Join the Techweek TV session on Taking a Healthtech innovation to market, Friday 28 May 12-12.30pm