‘Enabling the enablers’ in any thriving sector is a two-way street. Business leaders must continue to focus on industry-led commercialisation capability as a call to action for government support. Similarly, we know from history that focused and targeted government investment in any one sector, leads to private sector investment as the sector matures.
“Good enablers have a multiplier effect, so if they continue to meet return-on-investment criteria, we should provide the support they require to continue growing the industries of our future,” said Bronwyn Le Grice, founder & chief executive officer of the digital health commercialisation company, ANDHealth.
The ‘enabling the enablers’ position stems from the universal commentary that we excel at science, but are poor at commercialisation, yet we don’t fund some of our most high impact commercialisation organisations at scale, Ms Le Grice said.
“The reality is that when we talk about commercialisation in Australia, at a policy level, we are often talking about the translation of science and technology from university or research institutions and being able to take that to market, rather than capturing innovation wherever it happens and turning it into world-beating companies.”
Few know this better than ANDHealth, which has a proven record of scaling digital health businesses across a broad range of clinical and commercial metrics.
ANDHealth’s ANDHealth+ program is funded by the Australian government under the Medical Research Future Fund Early Stage Translation and Commercialisation Support Program, which aims to support small and medium enterprises (SMEs) to navigate complex clinical and commercial milestones to allow their evidence-based technologies to impact patients, clinicians and caregivers in Australia and around the world.
The program aims to support the commercialisation and expansion of Australian digital health SMEs — but is not without its challenges.
The funding shortfall of deep tech SMEs is a prime example.
“In our two flagship programs, our masterclass and ANDHealth+ program, our companies have raised over $165 million in six years. They have generated almost $50 million in revenue that has been reinvested in their development. They’ve created 512 new full-time jobs and impacted over one million patents.” Ms Le Grice said.
“In the digital health sector, it’s not patents or publications that are necessarily the “drivers of success” in technology commercialisation. It’s clinical outcomes, workflow alignment, health economics and finding genuine customers at scale in a sector characterised by extremely complex combinations of public and private sector payers.”
But organisations such as ANDHealth and other deep technology commercialisation accelerators are often themselves struggling for survival. The SME community they are built to serve simply doesn’t have the cash to pay commercial rates for the highly specialised services and expertise they provide, and many grants that enablers can access are only three years in duration.
Transforming our commercialisation capability as a nation comes from building pools of high-calibre, industry-interfacing capability that can supports hundreds of companies after they have been translated from the academic research sector, Ms Le Grice said.
“We’re seeing substantial shifts in government policy. The establishment of the Industry Growth Centres Program (which in part replaces now defunct programs) and the National Reconstruction Fund are positive signs,” she said.
“However, emerging programs are once again looking to individual contractors to support SME commercialisation, which is limited in both scale but also in bringing the diversity of experience required to be truly transformative. Similarly, government programs investing directly into companies sometimes underestimate the amount of hands on support companies need to utilise that capital as efficiently as possible and truly thrive.
“Having systems based on individuals does not create pools of capability. If we want to create pipelines of investment-ready companies into programs like the NRF, we need to fund different types of enabling organisations along the spectrum from university technology transfer through the valley of death and into the challenges of scale and the viability gap which can occur as health technology companies start their early commercial activities.
“The Industry Growth Program has been outlined as issuing programs which will fill this gap. But there are a number of proven commercialisation organisations which can become pools of capability to accelerate the pathways of the companies or technologies that come out of our research institutions into something that’s ready for substantial investment from both government and private sources.”
Ms Le Grice said this needs to be done in a way “where they’re not more worried about surviving than they are about supporting SMEs”.
Digital health, in particular, is undergoing a technological revolution, however the multibillion-dollar venture capital funding of 2022 is declining.
With data becoming the cornerstone for healthcare, SMEs and start-ups are leading by example, with innovative measures in wearables and sensors, AI, IoT and data analytics.
In Ms Le Grice’s recent keynote speech, “The Sustainability Fallacy”, she stressed the need for metrics that highlight return on investment or return on capital invested, including management costs. In addition, every grant should have a $100,000-$200,000 allocation for independent evaluation, she said.
Organisations that demonstrate measurable outcomes against key performance indicators of government should be given six or seven years of funding, with options to extend — rather than forcing them to pivot away from their core focus on supporting high potential SMEs towards generating their own commercial revenues at the expense of their core purpose.
“If we want to transform commercialisation outcomes, we need to look at our enabling organisations with proven track records — and give them long-term funding to create ecosystems which allow our innovators to commercialise, grow and thrive. And if we stop performing, then we should no longer be funded,” Ms Le Grice said.
This article was produced by InnovationAus.com in partnership with ANDHealth.
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