Starta VC reposted this
Venture Capital, Technology Alignment, Corporate Innovation | Founder at Elpislabs.com, Partner at Starta.vc
Who will fund your healthtech startup? What we learned from our last CVC panel with Highmark Health Ventures and Novartis: 🚀1-Under Most Pressure? Patents generally last 20 years (Novartis' CEO cited 17 years in his recent interview), after which generic versions become available, basically guaranteeing ENORMOUS losses in profits. In pharma/healthtech in particular, the astronomical costs of developing each new drug, coupled with long approval cycles, place immense pressure to innovate REALLY FAST. This means they must essentially create a whole new portfolio every 20 years, far outpacing the innovation demands of any other industry🔬 🕺2-The Dance Between Insurtech and Pharma Highmark is an example of a blended health organization, integrating a variety of healthcare services under one umbrella. They combine being a payer (insurance provider) with running hospital systems and offering insurance services, including Medicare/Medicaid. This approach often also puts the role of the “regulator” on them. Since they are the ones paying for drugs, they are highly motivated to optimize processes in the infrastructure too, including focusing on preventive healthcare and customer care🏥🌍 💲3-Who Will Pay? Founders who plan to sell to hospitals often have no idea how strapped for money those are. Insurtech companies often step in to provide funding for pilot projects and initial implementations, but they can be quite hard to reach too 🏥💸 🌱 4-The EVEN MORE Enigmatic Nature of CVCs An example of this is a CVC run by a huge healthtech corporation that quite for some time didn’t even have a website despite managing hundreds of millions. This highlights how some CVCs can still function and thrive without some of the conventional tools and visibility typically expected in the corporate and investment world. More often than not, CVCs can be a "black box," with unique and varied operational practices, making it difficult for startup founders to reach them without guidance 🔍5-Novartis' Internal Accelerator One way to engage with big pharma is to look for programs offered. Novartis, for example, runs an internal accelerator called "the biome". This accelerator is designed to help tech companies navigate the complexities of working with a big pharma company. It aims to expedite the product testing and validation process, which is not a common approach for traditional pharmaceutical companies that typically focus more on internal R&D and acquisitions 🚀 🤷♀️6- Startups Face Challenges Asian and European startups in pharma and medtech often struggle navigating the complexities of the US healthcare system. Tailored strategies and local partnerships are crucial to successfully integrate and scale their innovations in this market. A huge thanks to our wonderful speakers Prativa Joshi and Anita R. for the insights! Elpis Labs thanks to Starta VC for the amazing venue as always! #CorporateVentureCapital