THE US-ISRAEL LEGAL REVIEW 2019

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The US-Israel Legal Review 2019 91
in Israel. According to the IVC Research Center
report, cybersecurity companies raised together
more than $1.08b in 2018, in 89 transactions. This
might reflect, as we mentioned, the fact that Israel
is considered one of the global superpowers in
cybersecurity. In fact, according to Startup Nation
Central, Israeli companies receive approximately
15% of the global investment, and they develop
products used by all Fortune 100 companies. We
can find these days various Israeli companies
many different sections of the cybersecurity world,
such as mobile security, data protection, IoT and
automotive security, cloud security, applications
security, and more.
LIFE SCIENCELife Science is another prominent driver of
the Israel hi-tech industry. According to Israel
Advanced Technology Industries report, there
are currently around 1,450(!) active life science
companies in Israel, employing more than 85,000
people. Israeli life science companies are active
in various sub-fields such as medical devices
(almost 600 companies), healthcare IT, diagnostics,
therapeutics and many others. According to the
report,moreandmoreIsraelicompaniesaremoving
from the seed stage into more advanced stages,
which contributes to the maturity and experience
of the Israeli life science industry. Medical devices
companies attracted over the year the majority of
the capital raised, and in the past year we have also
seen an impressive exit to an Israeli company, when
Mazor Robotics was acquired Medtronic for $1.6b.
However we did see a slight decrease in the total
number of transactions and in the amounts raised
by Israeli life science companies in 2018. According
to IVC Research Center Report, Israeli life science
companies have raised $1.19b in 126 transactions,
compared to $1.23b raised in 126 transactions.
MEDICAL CANNABIS INDUSTRYIsrael has a buzzing medical cannabis industry,
with more than 50 companies working in this field,
alongside anadvancedacademic research. Recently,
the Israeli parliament passed an amendment to
the Dangerous Drugs Ordinance. This amendment
settles the regulation regarding the supervision on
dealing with medical cannabis, and it increases the
possibility that the Israeli government will soon
grant an approval to export medical cannabis from
Israel. Such an approval can have a very positive
influence on this industry and on the company
engaged in this field.
INCENTIVES TO MULTINATIONALS BY THE
ISRAELI INNOVATION AUTHORITYThis year, the Israeli Innovation Authority
(the “IIA”), has published new rules in order to
incentivize multi-nationals corporations to invest
in and acquire Israeli companies. Before these
new rules, Israeli companies were obligated to
receive the IIA approval and to pay considerably
high fees if they wanted to grant license to their IIA
funded knowhow outside of Israel. The new rules
now allow Israeli companies which are part of a
multinational corporation (or Israeli companies
that are multinationals themselves) to pay lower
fees under certain conditions when they want to
license IIA funded knowhow outside of Israel to
entities of the multinational corporation.
EXPECTATIONS FOR 2019In 2018, we have seen a solid growth in the fields
of Fintech, AI and cybersecurity. We expect to see
continued growth in these fields in 2019 as well,
as the global demand for such technologies keeps
on growing. In addition, despite the ongoing issues
between the US and China, the share of foreign
investments in Israel from each of China and the US
has increased in the past year, and we expect to see
a continuation of this trend in 2019. n
There are at present
around 1450 active life
science companies in Israel,
employing more than
85,000 people.