Public Venture Capital for Israel's Biotech Industry

Merely judging from the activity at the early June ISLI Biomed Israel meeting, the industry’s annual gathering, Israeli biotech is hot. Exhibit booths—even of service providers—were crowded. Wherever one turned, there was a start-up or an academic anxious to wrap a company around his invention. The exhibit halls at BIO were moribund in comparison.

Helping to heat things up: Israel’s comparatively tiny venture-capital industry has grown interested in biopharma. It’s true that the funds are still dominated by device projects. With relatively little money overall, and a flood of inventions from health care uses of its vaunted defense technology innovations, Israeli VC has chosen industries where capital requirements, development risk, and commercial timelines are far more reasonable than biotech—and demonstrated extraordinary success