Expand your knowledge on the Medical Device Sector in Israel


Israel has emerged as one of the world’s leading centers for the development of innovative medical devices. The country has by far the highest proportion of any country of new patents in this sector per head of the population. Nearly 300 companies in this field in Israel, about half of the country’s Life Sciences sector, encompass a diverse range of medical disciplines including therapeutics, diagnostics, implants, disposables and medical equipment.


Medical devices sector constitutes a fast growing global market with innovative devices providing breakthroughs in earlier and better diagnoses and medical treatments that bring clinical benefits to patients at a cost savings to the healthcare system and the individual patients.


Israel’s strength in this sector stems from inter-disciplinary capabilities, which bring together medicine, clinical expertise, materials science, electronics, software expertise and engineering know-how. Some of the world’s leading universities with renowned R&D faculties, leading edge medical centers, the world’s highest per-capita number of physicians, and a flourishing high-tech sector combined with a spirit of entrepreneurship have all contributed to the country’s dynamic growth in medical devices.


Israel’s best-known medical device firm is Given Imaging, which is redefining gastrointestinal diagnosis by developing, producing and marketing innovative, patient-friendly products for detecting gastrointestinal disorders. The company’s flagship technology, the Given Diagnostic System features the naturally ingested PillCam(TM) video capsules endoscopes. PillCam™ SB for the small bowel and PillCam ESO for the esophagus, both cleared by the FDA. PillCam capsules for the stomach and the colon are under development. Established in 1998, Given Imaging is listed on the NASDAQ.


Israel’s medical device sector evolved from the country’s highly successful medical equipment industry, which was pioneered in the 1980’s and 1990’s by Elbit, which developed diagnostic imaging technology including innovative nuclear and magnetic resonance imaging and ultra-sound equipment. Elbit eventually sold its diagnostic medical imaging using computer tomography to General Electrics Marconi division, which in its turn was acquired by Philips Medical Systems. Similarly, Elbit’s diagnostic ultrasound and nuclear and magnetic resonance imaging were sold to GE Healthcare.


Elbit and GE Healthcare’s partnership has spawned one of the country’s most promising medical device firms – InsighTec. Established in 1999 by Elbit and General Electric, ExAblate 2000, InSightec's first product, is FDA approved, and integrates focused ultrasound thermal ablation with magnetic resonance imaging capabilities to provide a non-invasive method for destroying or ablating targeted tumor tissues. InsighTec plans a summer IPO on the NASDAQ market.


Another veteran Israeli medical device company is Lumenis, initially established in 1991 as ESC Medical Systems and formed several years later following a merger with Coherent Medical Group. Lumenis develops, manufactures, and markets state-of-the-art proprietary laser and intense pulsed light devices for dermatology and aesthetics. Traded on the US NASDAQ market, Lumenis is Israel’s largest medical devices company.


In recent years Israel’s medical device sector is attracting increasing amounts of foreign investment. This is achieved through VC funds, IPOs and direct investments from major US and international companies like Johnson & Johnson, Boston Scientific, Medtronic and Guidant.


Johnson & Johnson acquired Israeli medical device firm Biosense through its Cordis Division. Biosense provides solutions for endocardial diagnosis and therapy. Johnson & Johnson has also invested in Contec Medical, which develops multimedia information solutions for point of care applications and NESS (Neuromuscular Electrical Stimulation Systems), which provides technological solutions for patients suffering from paralysis due to neurological disorders.  The company has also made an investment in Impulse Dynamics- a developer of an active implant to treat chronic heart failure.


Boston Scientific acquired Mel – Medical Enterprises Group, which develops minimally invasive therapies for the treatment of cancer with a flagship product that induces remission and reduces recurrences of cancer of the bladder. Boston Scientific has also invested in Sightline, which specializes in the design and development of medical endoscopic systems,. In addition, Boston Scientific invested in BrainsGate that is developing an implantable neuromodulator to treat brain tumors and other neurological disorders and in VisionCare Ophthalmic that has developed an implantable telescope to treat the dry form of Age Related Macular Degeneration.


Guidant Technologies acquired X-Technologies in 2003 for about $150 million. X-Technologies, founded in 1999, has developed a pull wire for use with catheters in balloon angioplasty, which effectively treats artery narrowing. Kodak Health acquired Orex Computed Radiography . Orex is developing, manufacturing and marketing low cost computerized radiography products, based on innovative phosphor plates. The technology captures X-ray images digitally, eliminating the need for film development processing


Examples of IPOs in addition to Given Imaging include Card Guard, traded on the Swiss Stock Exchange, which has developed advanced telemedicine software and monitoring equipment for high-risk and chronically ill patients, and Oridion Medcial, also traded on the Swiss Stock Exchange, develops and manufactures breath-test analyzers, which can detect cancers and ulcers.


Israel is a world leader in medical IT and Aerotel is a world leader in modular, mobile telemedicine devices, while Neurotrax Israel has developed Mindstreams which provides physicians with real-time objective measurement of cognitive functioning. Tadiran LifeCare, a business unit of Israeli-based wireless communications company Tadiran Spectralink, has developed a series of cellular-based wrist-wearable mobile monitoring devices.


Promising young companies include BioControl, which was founded in 1999, and has developed active implantable muscle stimulator to treat incontinence of all types and an implantable device to treat chronic heart failure. Versamed, established in 1999, is a leading provider of software-based ‘smart’ medical ventilators, while MediSpec is dedicated to making the most efficient and minimally-invasive medical treatments in such areas as orthopedics, cardiology, oncology and relief from kidney stones. InterCure, a medical device company has developed and patented a technology platform for respiratory-based treatment of cardiovascular and pulmonary diseases.


Quantomix develops innovative products for rapid, high resolution imaging of wet samples, while Impliant has developed a new orthopedic technology, which replaces polyethylene and metal used in hemiathroplasty and spine implants with patented polyurethane. Medingo Ltd., which was established by RDC (owned by Elron and RAFAEL) at the end of 2005, is developing a miniature disposable insulin dispenser.


Another successful drug delivery company is WaisMed, which has developed advanced intraosseous infusion (IOI) devices, designed to offer safe and highly effective solutions whenever traditional intra-vascular access is not possible. Microjet-Tech is developing a high precision micro syringe.


TopSpin Medical has developed a unique and novel technology for local high-resolution MR imaging using a miniature hand-held probe incorporating all magnetic field sources and eliminating the need for external magnets and a bulky and expensive MRI scanner. Another imaging company is Cadent, which develops and manufactures digital imaging solutions for the dental industry, while Odin Medical Technologies develops, manufactures and commercializes Intraoperative MRI systems designed for use by the neurosurgeon in standard ORs.


OrthoMediTec specializes in orthopedic trauma solutions, while GI View is engaged in the development of highly advanced endoscopic technologies for the gastrointestinal tract. HDH Medical is developing devices for suture-less vascular anastomosis and Or-Sense is developing non-invasive glucose monitoring systems for diabetes sufferers. TavTech’s skin rejuvenation products are based on jet aviation principles, while Cardiosol is developing innovative technology for interpreting the electrical activity of the heart. Nanomedica is developing innovative scanning Doppler ultrasound technology.


In the area of therapeutics Galil Medical specializes in the development, manufacture and marketing of minimally invasive cryo medical devices and systems. Incorporating advanced hyper-cooling technology, the Galil Medical system allows extremely fast, high-resolution and controlled tissue ablation, including cancerous tissue. Medinol is a global leader in minimally invasive cardiovascular stent technology. Dune Medical Devices is developing surgical devices and techniques for real-time, intra-operative optimization of surgical oncology procedures. Dune's groundbreaking technology for intra-operative tumor margin assessment will eliminate the need for painful and costly repeat surgical oncology procedures.


Leading start-ups include NeuroSonix, which is developing non-invasive technology for protecting the brain from embolisms during open-heart surgery and other cardiologic procedures and angiographies. E-Pill Pharma is developing an oral drug delivery platform enabling large molecule drugs to be administered orally, while ETView's flagship product is an endotracheal tube (ETT) with an embedded video camera at its tip, which provides for a clear view and continuous monitoring of the upper airways and trachea during intubation.