A medical researcher in Australia has less than a one in five shot of getting a government grant to further their research — it’s why, increasingly, they’re turning to companies like Novita Healthcare (ASX:NHL) for help.
Getting government grants to further research has always been a sore point in Australian medical research fields, and the laborious granting process has meant that researchers are spending more time filling out applications than doing actual research.
When they’re applying for grants, their chances can be slim.
For example, in 2018 there were 4923 applications for funding from the National Health and Medical Research Council.
Just 956 of those applications were funded.
The ratio of funded applications to unfunded applications is broadly the same, or worse, from research bodies such as the Australian Research Council.
It’s why companies such as Novita Healthcare (ASX:NHL) are set to play an increasingly vital role in not only the funding and development of research — but turning that research into a real-world outcome.
Whereas once upon a time medical researchers may have recoiled at the idea of working with a commercial entity, the scarcity of research dollars and an increase of focus on commercialising intellectual property more generally has seen a step-change in attitude.
“When you take money from the public purse, at the very least you should be able to demonstrate a very real-world outcome,” Novita’s Tali Scientific Advisory Board member Professor Kim Cornish told Star Investing recently.
It was from her research that Novita’s flagship product, Tali Train, was born.
“I think you see that attitude from the people giving the money, and I think it’s the right thing. You shouldn’t be given money to intellectually play around with an idea — public money should come with a public benefit,” Cornish said.
It’s an attitude that is starting to seep into researcher’s bones, and teaming up with private sector organisations is being seen as a key plank in getting their research into the hands of those who could benefit from it most.
It’s something that Novita Managing Director Glenn Smith is seeing on a daily basis.
“Things have shifted dramatically,” he told Star Investing. “Institutions are very proactive in terms of their intellectual property portfolio, very receptive to organisations like Novita where we have groups of individuals with proven track-records in terms of technology commercialisation and delivering results.”
This increasing willingness to partner with the private sector is what led to the creation of Novita in the first place.
The Novita gameplan
“Novita was formed to find specific investments in the healthcare space, where the core principle is to find really interesting technology that could be commercialised rapidly and scale globally,” Smith said.
Tali is a classic example of that.
Tali Train helps kids with inattention issues, such as those diagnosed with attention deficit hyperactivity disorder (ADHD), to improve aspects of classroom concentration by delivering training programs via touchscreen or mobile device.
“Our philosophy is to focus in on technologies that would address large, global, specific problems,” Smith said.
“Neurological conditions, have been labelled in the top ten issues globally and to solve that would make a significant difference to mankind.”
Pivotal to identifying research projects which have the potential to be scaled and turbo-charged through private investment is a partnership with Melbourne-based Grey Innovation and Monash University.
Grey Innovation partners with universities in Australia and Germany to identify research projects which could have a commercial application. In the case of Tali and Novita it played a key role in bringing the two together.
“Grey Innovation has a specific core experience at really working up and translating research into minimum viable products, and allowing organisations like us to supercharge them in a real commercial sense,” Smith said.
“We [Novita] raise the capital required to really make those things go global.”
The Tali investment makes sense for Novita as it not only addresses a huge, global problem it also has the ability to scale through tech.
Luckily, Smith has made it a point to learn all he can about the tech world.
From biotech to tech, and back again
Smith has a grounding in leading biotech and medtech companies. About ten years ago he made a conscious decision to learn absolutely everything he could about the world of tech.
For example, he’s on the advisory board of augmented reality company Plattar, served on the board of startup peak body StartupAus, and was CEO of SpotJobs.
“It became apparent that there was a real inflection in terms of software technology and other types of technology, not just coming into the healthcare system but also and I thought ‘that might be a great opportunity to get involved in a whole lot of different type of tech startups’,” Smith said.
“And so that ranged from medtech, biotech, AR/VR, to agritech to online marketplaces to a whole lot of activities.
“Those experiences allowed me to look deeply at the technologies that are leading in particular sectors — and really get my head around how to leverage those technologies to deliver solutions to gaps in the marketplace as quickly as possible.”
While Novita is categorised as a healthcare stock, it operates more as a tech company – and it’s betting on Tali being a great demonstration to other researchers how taking a private tech enterprise approach to delivering health outcomes is a great idea.
“One of the great things about what we’re doing is that we’re developing a platform. We can use that platform technology to experiment, and perhaps even move into other types of neurological areas,” Smith said.
If Novita can demonstrate the successful mass delivery of an idea born in a research lab to the real world, it will be in a great position to convince other researchers and institutions to do the same.
“We will look to replicate that [partnership with Monash University] with other institutions as well and take that core research and rapidly develop it into a commercial outcome,” Smith said.
“We’ll look at different types of acquisitions, and that might be out of private hands or current businesses or other types of institutions or organisations which are developing research.
“We may be able to bring that in-house, and either complement what we’re doing or rapidly develop products and revenue from that.”
If Novita can prove up the path to a global market with Tali, then there’s no telling where it could go.
This content is produced by Star Investing in commercial partnership with Novita Healthcare. This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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