Australia is globally recognised for its exceptional medical research output. Success stories like ResMed, a global leader in sleep technology, demonstrate Australia’s ability to translate scientific discoveries into improved patient care. This reputation is not just a matter of pride; it reflects a robust ecosystem of innovation that has the potential to revolutionise healthcare not only locally but also on a global scale.

According to Australia’s Medical Science Co-Investment Plan, “Australia’s health and medical research is an outperforming sector … Australia is ranked 5th in the World Index of Healthcare Innovation.” This accolade highlights the country’s commitment to advancing medical science. However, despite this strong foundation, there remains a significant gap in the journey from research to product, raising the question: why isn’t Australia’s cutting-edge research making its way into clinical care?

Five Critical Challenges

Translating medical research in Australia from the lab bench to patients’ bedsides is fraught with challenges. Understanding these hurdles is essential for anyone interested in the healthtech landscape.

The first challenge is regulatory barriers. The Therapeutic Goods Administration (TGA) approval process is crucial for ensuring patient safety, yet it poses a significant financial and time burden for healthtech startups. The TGA’s limited funding and slow approval process exacerbate these challenges, making it difficult for innovators to navigate the regulatory landscape. Given Australia’s relatively small market size, many startups are incentivised to focus their regulatory efforts on larger markets like the United States or Europe, further complicating the commercialisation of local innovations. The Medical Research Commercialisation Landscape Report underscores that these regulatory hurdles are a primary reason for Australia’s lag in bringing medical research to market.

The second challenge lies in global market dynamics. Medical intellectual property (IP) is highly portable, and much of Australia’s medical IP is exported for commercialisation in more competitive economies that possess a comprehensive ecosystem for medical science. Alarmingly, Australia’s medical science priority areas contribute only 0.3% of the nation’s GDP, indicating a significant underutilisation of its research capabilities.

Funding accessibility represents the third challenge. While government initiatives like the $450 million Medical Research Commercialisation Initiative provide valuable support, the Australian Medical Device Venture Investment Summary Report reveals that in 2023, Australia invested less than $350 million in the medical device sector. To sustain and graduate ten innovative healthtech companies annually, Australia would need to invest at least $660 million, highlighting a critical funding gap.

Turning Obstacles into Opportunities

Despite these challenges, launching a healthtech startup in Australia is not without its opportunities. For aspiring entrepreneurs, focusing on major unmet health needs can be a game changer. For instance, women’s health has historically received a fraction of the venture capital allocated to other sectors. To address this gap, UNSW Founders, in collaboration with The George Institute for Global Health and Virtus Health, has launched a Women’s Health Accelerator. This program aims to support innovation in women’s health, fostering companies like 23Strands, which is revolutionising reproductive health through genomics.

Building effective teams is also crucial. Take CardioBionic, for example, which develops innovative heart assistive technologies. By combining deep clinical and mechanical engineering expertise, CardioBionic is on the verge of its first human implantation following successful preclinical results. As Parisa Glass, Director of Operations at UNSW’s Clinical Research Unit, points out, “Connecting health innovators with healthcare providers and consumers early on is a game changer. When they team up from the get-go, innovators can really zoom in on the actual needs and challenges that providers and patients face.”

Seeking tailored support for health innovators is another vital strategy. Initiatives like UNSW’s Health 10x Accelerator provide essential platforms for healthtech commercialisation, offering tailored education and support. As Dina Titkova, Health 10x Program Manager, states, “We have provided tailored health commercialisation education and support to over 150 teams, which includes access to our 500+ mentor network, and because of this support, the five-year survival rate of our healthtech startups is above 80%.” This program has backed startups like Preview Health, which is developing the world’s first commercial diagnostic test for Parkinson’s disease, leveraging AI to detect the condition up to 15 years earlier than current methods.

Strategic partnerships with international research institutions, global investors, and industry players are essential for scaling healthtech innovations. For instance, Nuroflux is developing a non-invasive continuous stroke monitoring device. By collaborating with The George Institute for Global Health, Nuroflux was able to accelerate its path to clinical trials cost-effectively, a critical step in bringing its product to market.

Lastly, adequate funding is crucial for any startup’s success. Over $1 million in federal government funding enabled the national expansion of the Health 10x program, further supported by a generous $1 million donation from Maha Sinnathamby AM, one of Australia’s most iconic entrepreneurs. This early-stage support is vital, but it must be followed by continued funding for healthtech startups to scale, manufacture, and conduct clinical trials onshore.

Australia has proven it can turn its world-class research into life-saving medical products. With the right support systems in place, Australia’s healthtech sector is poised to thrive, creating economic prosperity and addressing global health challenges.