Callaghan Innovation has launched a new sector update, 'Activating NZ Healthtech: Clearing the path to commercialisation', which describes unique obstacles faced by NZ healthtech businesses. These research findings were behind the development of the HealthTech Activator (HTA), NZ’s first support mechanism designed to unleash the potential of the country’s healthtech sector.
Healthtech represents significant economic potential for New Zealand, with companies such as Fisher & Paykel Healthcare demonstrating the impressive opportunities in the market. Innovators are emerging from all over the healthtech ecosystem, with entrepreneurs comprising the bulk of NZ healthtech business founders.
Callaghan Innovation Head of Health Technology, Andrew Clews, said despite NZ’s big healthtech players experiencing some success, research informing the design of the HealthTech Activator (HTA) showed there were still challenges to overcome for the industry to meet its full potential.
“While the NZ healthtech industry has been growing fast, our research found clinical trials and complex regulatory requirements were the most common hurdles NZ healthtech companies face,” says Clews.
Different countries have different regulatory requirements and reimbursement processes. Understanding and progressing these can be complex, costly, and time consuming.
“It can be difficult for new companies to wrap their heads around,” says Clews.
The HTA Discovery Project research found healthtech businesses had difficulty accessing certain types of funding (such as pre-seed) and had difficulty accessing the educational support needed to take products to market.
The research also found that the complexity of healthtech, and the longer return on investment timeframe (market entry may take up to 10 years) means the sector appeals to only a limited group of investors.
As you can see from the below graphic derived from the TIN Healthtech - Insights Report 2020, NZ’s healthtech sector has shown impressive fundamentals.
Healthtech represents significant economic potential for New Zealand, with companies such as Fisher & Paykel Healthcare, valued at $17.2b as of June 14 2021, demonstrating the impressive opportunities in the market for Kiwi healthtech. Exports made up 87.5% of all NZ healthtech revenue in 2019 with 4,296 people in the sector in NZ.
New Zealand’s largest healthtech businesses have performed extremely well over the last financial year, with Fisher & Paykel Healthcare recording $1.97 billion revenue. This suggests healthcare businesses have the attention of customers and investors in the wake of COVID-19.
The HTA website provides ecosystem and funding maps with focused areas of support in market validation, capital education, reimbursement strategies, regulatory planning, and clinical trials – five key areas the HTA Discovery Project identified as those where support could help accelerate the ecosystem.
“The HTA aims to identify these challenges, and address them by offering a low-cost avenue for healthtech companies to access support they need to navigate them,” says Clews. “We want to ensure a future where NZ healthtech is meeting its full potential as a multi-billion dollar export industry, creating high-value employment and revenue for Kiwis, while addressing some of the most pressing healthtech challenges of our time.”
Read the full industry update: 'Activating NZ Healthtech: Clearing the path to commercialisation'