Despite the challenging economic climate and wider geopolitical uncertainty, innovation remains at the forefront of Israel’s leading med-tech startups, as the industry registered another successful year of funding, and witnessed investors making more strategic investments.
Funding of med and health technology companies experienced a decline in 2024, with total health tech funding reaching $1.2 billion last year, a decline from $1.6 billion reported in 2023, according to data from Startup Nation Central.
Despite the recorded decline, average deal size doubled from $2.16 million in 2022, to $4.60 million in 2023. Experts believe that investors, both domestic and foreign have started taking more aggressive steps to make larger, and more strategic investments.
Sectors that experienced the most activity include digital health, which encompasses the use of communication technologies and software, including data analytics to assist in improving patient health. Funding in this area totaled $545 million invested, with the second-largest share coming from the medical devices sector, with $380 million invested, and pharma/biotech having secured $262 million in funding.
Israeli health-tech has capitalized on the surging demand for more innovative artificial intelligence-focused solutions, with Silicon Valley names, including NVIDIA, Pfizer, and Johnson & Johnson being among the several dozen multinational corporations investing in local health-tech companies.
For instance, the Tel Aviv-based CytoReason, a biotechnology company which develops software to model and map various treatments across different patient groups and diseases has/ received backing from both NVIDIA and Pfizer in an $80 million funding round, further shows how global names are steadily integrating Israeli technology into their long-term investment plans.
As demand continues to grow, and consumer preferences for digital healthcare expands beyond traditional solutions, a handful of Israeli healthtech companies are setting the tone for future innovators, and leading the race in digital medical technology.
These are among them:
AISAP
In 2024, AISAP, an artificial intelligence company secured $13 million in seed funding to further advance its Point-of-Care Assisted Diagnoses (POCAD) device. This device is designed to assist in simplifying ultrasound procedures for patients, and leverages AI-powered software to deliver case-specific outcomes and requirements.
The components of POCAD will help healthcare providers, along with patients, have more accurate and detailed measurements. This technology would enable healthcare professionals to deliver more accurate and rapid diagnosis, ensuring patient safety and well-being.
POCAD is designed to provide AI-based diagnosis for patients that suffer from structural heart diseases or heart failures. Through a comprehensive cloud-based platform healthcare professionals and patients will have access to more accurate feedback, while leveraging digitally-guided assistance.
Since inception, AISAP has been trained on more than 300,000 studies, which comprised a total of 24 million video clips. By using vast quantities of data, AISAP can effectively validate medical conditions more accurately, and promote AI-enabled ultrasound technology with heightened efficacy.
In just a short few years the company has become a pioneer in ultrasound technology, partnering with highly acclaimed institutions including the Mayo Clinic, Mass General Brigham, and Crozer Health.
VI Labs
Still in the scope of artificial intelligence, VI Labs develops organizational data software for healthcare providers, enabling them to take advantage of a dedicated Software-as-a-Service (SaaS) platform to level psychographic, geospatial and patient data.
VI’s predictive SaaS technology provides companies with access to a wealth of patient data, enabling them to have a more accurate understanding of customer needs, preferences and emerging market trends.
VI’s working software solutions are currently being used by more than 180 million members, patients, and professionals, with the ability to reduce operational costs by 15%, and increase overall program utilization rates by 28%.
Already, the company is working with some of the biggest health providers and pharmaceutical companies, helping to boost their enrollment, customer engagement, retention and patient healthcare outcomes.
Last year the company raised $111 million in funding as they seek to elevate their AI-powered SaaS platform, and further transform how medical professionals capture and optimize their working channels.
OneStep
Continuous patient mobility monitoring technology remains a challenge in most healthcare facilities, including private residences, senior care facilities, and nursing homes. However, OneStep has been on a mission to resolve these shortcomings, by building an advanced smartphone-based motion analysis alternative.
OneStep was founded in 2018, and in 2024 raised $36 million in funding through multiple funding rounds. The funding is poised to help advance the company’s position in gait motion analysis technology.
Gait often refers to the pattern in which a person or animal walks. As one begins to age, abnormalities may occur in gait patterns, with around 15% of people over the age of 60 years having experienced gait abnormalities. OneStep will aim at making continuous mobility monitoring more accurate and allow AI-powered predictive technology to assist with patient mobility data analysis.
According to a case study published by OneStep, those using OneStep predictive technology software have seen a robust improvement in fall prevention for patients, while boasting increased revenue. For example, Signature Rehab achieved an 11 times return on investment, while decreasing fall occurrences by 31% among residents within the first 90 days of application.
Promise Bio
In the bio-pharmaceutical sector a few key players are beginning to show face as technological advancements bring new developments to the forefront and help to create more patient-centric solutions.
Promise Bio, a Tel Aviv-based bio-pharmaceutical innovator has developed a cloud-based AI platform to assist with the detection of Post-Translational Modifications or PTMs in proteins. This technology would enable more accurate medicine development for autoimmune diseases, and fast-track the precision treatment for cancer patients.
Such developments would make it easier for researchers to test various types of protein modifications, which could lead to unlocking new precision medicine, and help pave the way for new advancements in genomics.
Using computational techniques, coupled with artificial intelligence, and existing research, Promise Bio could deliver genomic-testing technology that could potentially reduce testing trial periods, and deliver more accurate results faster.
In the last few years the company achieved several major milestones. For starters, Promise Bio secured $8.3 million in funding to advance its epi-proteomics research. The funding closed in April 2023. The company secured backing from both Pfizer and AstraZeneca to promote future collaborations on research projects.
Exsilio
Genomic medicine development is gaining increased momentum as technology advances and provides scientists with better access to therapeutic data. Furthermore, AI-powered models are helping teams uncover emerging patterns to supercharge mRNA technology.
Exsilio is making waves by developing the technology to establish redosable genomic medicines that can be used to treat a range of complex diseases. The mRNA-based bio-technology developed by Exsilio will assist in correcting genetic errors that cause illnesses such as cancer and autoimmune disorders.
mRNA, sometimes known as messenger RNA assists with carrying genetic information from DNA. Exsilio looks to leverage mRNA more effectively to fast-track reasonable genetic medicines, which will not only be safer for patients, but will target genetic errors more accurately, and further reduce potential risks in those undergoing treatment.
By leveraging mRNA technology, Exsilio aims to fast-track redosable genomic medicines, helping reduce the risk for patients undergoing treatment.
Backed by $82 million in Series A funding, the company is looking to extend its suite of potential solutions and address critical healthcare challenges that continue to place immense pressure on public healthcare facilities and supply chains.
Key Takeaways
Healthcare is rapidly advancing, and Israeli med-tech companies are securing their future on the stage as they develop advanced technological solutions, while seeing interest from the biggest names in the tech and healthcare industry.
It’s estimated that there are currently 1,800 active Israeli health sciences and wellness companies specializing in biotechnology development. This projected number is expected to grow in the coming years, as need for more accurate, and innovative medical technologies begin to see widespread across the world.
The strong investment, stemming from all over the world, is helping fuel Israel’s bio-tech industry, and leading to more robust human and digital capabilities.
Israeli digital healthcare, with its strategic partnerships, will play a vital role in the future of medical developments to promote human-centric care through the use of artificial intelligence.
Jacob Wolinsky is a financial journalist specializing in hedge funds. He was an equity analyst before founding ValueWalk.com, a prominent financial news platform, which he led until its sale in 2023. With 15 years in the industry and experience as an equity analyst, Jacob has experience in journalism, equity analysis and the hedge fund industry. He has been writing for Forbes since 2020 Currently, Jacob runs Hedge Fund Alpha.