September 4, 2005

Bringing them back home – ‘The initiative was always outstanding in this country, what we didn’t have was management.’ Guy Malchi is at his weekly meeting with Professor Zvia Agur, the founder and chair of Optimata, an Israeli bio-simulation company working on cancer treatment.

They are sitting at the home office of the Institute for Medical Biomathematics, the non-profit research organization, located on the outskirts of Tel Aviv.

“It’s a great place,” Malchi says of the idyllic surroundings. “It encourages innovation. You can think clearly here.”

Malchi, born and raised in Israel, left behind a lucrative career as partner for the European life sciences division of Tefen, a multinational corporation with headquarters in London, to work as the president of Optimata.

“The initiative was always outstanding in this country, what we didn’t have was management

A graduate of London Business School, he turned down the offers from British companies that came when he left Tefen.

“Our first son was already five, and the family was going to become bigger,” he explains. “We wanted to be back with their grandparents, while they were still at an age where they could chase the kids around in the backyard.”

With training and experience in company management, industrial engineering, life sciences, and business development, Malchi was drawn to the inter-disciplinary work of Optimata, which sits on the edge of high tech and biotech, two of Israel’s strongest industries.

Among other advances, Optimata has created a computer program that simulates the human body, eliminating the need for trial-and-error approaches to drug therapy.
By matching a drug’s action mechanism to a person’s bioprocesses, this mathematical matrix determines exactly what doses of medications are suitable for each individual patient.

While pharmaceutical companies will save millions of dollars and years of testing time, patients will be spared unnecessary suffering.

“One of the main problems in providing effective chemotherapy is that the situation of every patient is unique,” says Dr. Stephen Chan, Principal Investigator of Optimata’s study on breast cancer patients at Nottingham City Hospital in England, where the first patients will have benefited from Optimata’s work.

“Tumors grow and spread at different rates, and the amount of chemotherapy that each patient can tolerate varies considerably from patient to patient. A major unmet need is being able to predict in advance the optimal therapy for each individual.”

According to Bernard Dichek, publisher of BioIsrael , Israel’s biotech industry newsletter, Optimata’s ability to meet this need exemplifies Israel’s interdisciplinary edge.

“A modern Western plague is the way nobody talks to each other. But Israelis are completely the opposite…they are able to communicate well together. So this type of collaboration leads to new discoveries and inventions.”

Others say that Israel has no choice but to develop high tech industries.

“Israel is on the cutting edge because we have no other alternative; that’s where our added value is,” says Efi Cohen-Arazi.

The son of Jewish refugees from Egypt, Cohen-Arazi was born and raised in Israel, where he grew up in a two-bedroom apartment with a family of 10.

A rags-to-riches poster boy, he worked his way up to vice president of American-based Amgen, the world’s largest biotech company, but recently left his position to become chief executive of Intec, a biotech start-up in the hills of Jerusalem.

“What we can achieve is something akin to the David and Goliath model: Develop a small, smart, fast team working on the cutting edge, then get resources that are needed to take us forward,” he says.

With the development of the accordion pill, Intec is definitely on the forefront.
Though the pill looks like an ordinary-sized capsule, it unfolds like an accordion once inside the stomach, enabling slow release of medication for up to 24 hours.
For a patient, the pill offers minimum side-effects and no more waking up in the middle of the night.

For the drug company upon which Intec bestows this technology, the pill substantially will improve drug absorption capability, and therefore, offer a strong competitive lead in the drug market.

To this end, Intec is currently negotiating with several large American pharmaceutical companies , an endeavor made easier by the fact that Cohen-Arazi is on a first name basis with chief executives of Pfizer, Johnson & Johnson, and other pharmaceutical companies.

Across the board, Israel’s current influx of repatriates like Cohen-Arazi and Malchi brings elite international experience to Israeli biotech, turning the industry into an alluring foreign investment.

“The initiative was always outstanding in this country,” explains Agur. “What we didn’t have was management. People knew how to do science, but they didn’t’ know how to manage the industry so well. A new generation of Israeli management is now taking over, hence the late but successful rise of biotech here.”

Israeli high tech boomed from 1998-2001, hitting an all-time high of $3bn invested in 2000. Its fierce growth led to the expansion of Israeli biotech, whose venture capital investments more than doubled from $100m in 1997 to $240m in 2001.

With the global market crash at the end of 2001, both industries took a nosedive; but today, things are looking up. Not only are Israelis returning home, but international businessmen are looking over the industry as well.

At this year’s Biotech 2005 Conference and Convention, one in three conference registrants came from abroad this year, a fourfold increase from 2004.

“Last year if an executive from Merck came to Israel it made the country’s headlines,” said Dichek. “This year, I am barely able to keep track of foreign delegations sweeping in and out, looking for investment potential.”

(Originally appeared on

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