People behind healthcare innovation: Interview with Anat Naschitz, CEO and Co-founder of 9xchange

As part of our work, we have the privilege to speak with many inspiring innovators. Although the business community usually focuses on companies, pitches, and valuations—and less on the innovator—we thought it would be interesting to learn a bit more about the people behind healthcare innovation. In this series, we’re sharing some of our conversations with innovators in a condensed format to gain insights into their experience, their opinions, and their learnings.

?This latest conversation is with Anat Naschitz, CEO and Co-founder of 9xchange, a “biomarket” that aims to unlock lifescience transactions, by bringing electively anonymous transparency to both supply and demand as well as online efficiency to the deal itself.

Gila: What’s your story, and how did you get started in healthtech?

Anat: My interest in healthtech dates back to my McKinsey days actually. Some friends and I won a business-plan competition by building a plan for portable, personal medical records, which are reality now, but that was in 1999—pre smart phones. This early interest continued as a VC; I invested in this field before it became trendy. My career path has been nonlinear. I have taken opportunities as they’ve come along and pursued?things that have forced me to learn constantly. I went from practicing law to business?school (INSEAD) to McKinsey to investment, first at Apax and then as a co-founder and partner at OrbiMed Israel. This adds up to 27 years in healthcare across biopharma, digital health, and devices, with companies?at all stages and of every size, from big pharma to two-person startups.

I have always been creative. In my personal life, I paint, sculpt, invent recipes, sing, and also used to design and make my own clothes and jewelry as a teen. As an investor and entrepreneur, I am energized by new ideas—mine or others’—and innovators who have the ability and passion to bring them to life.

9xchange, which I am building now, is the direct result of all this. I have always thought that we spend too much energy and rely excessively on serendipity when seeking “the ones”—those industry-grade assets to build a company around, inject into our portfolios, acquire, and develop. The disconnect is that these assets often exist, but they are invisible, or their potential availability is unknown. Many biotechs have large pipelines and insufficient resources to push all of them through clinical development. Especially now, many companies should monetize assets they cannot afford to develop, just to survive. Currently, more than 200 companies trade below cash, and many others have no hope of financing. And yet, very few spend energy on out-licensing those assets, often due to scarce business-development resource. Pharma tells a different but ultimately similar story: companies reprioritize often, either through predetermined cycles or upon events (M&A, new strategy, new leadership) but devote 95 percent of their business-development resource to in-licensing, which leads to many viable programs sitting on the shelf.

What then if there were a way to test the value of an opportunity that is low risk, anonymous, and enables participants to complete the process easily and efficiently? 9xchange does exactly that. We’ve built a biopharma marketplace enabling buyers to find transactable assets, sellers to test the value of their assets in an anonymous and protected way, and all parties to connect and transact in a very efficient manner. The idea is to inject the way we live in 2022 (across connectivity, dating, shopping, and more) into the way we transact. 9xchange is for the entire ecosystem—members include pharma, biotech, entrepreneurs, top investors, and academia—and it is curated to ensure quality of membership and content. 9xchange transcends specific programs, covering any life-science innovation and deal type, including platforms, discovery technologies, and more, while we are building additional layers that further add to the offering. The objective is to create a one-stop shop for any life-science deal.

Gila: Where do you see healthtech moving to over the next ten years?

Anat: Healthcare is exciting and becoming even more so.?

?On the biopharma side, we already see an explosion of innovation, with technologies harnessing a combination of biological insight and computing power. (The “buzz du jour” is artificial intelligence, machine learning, and quantum computing, but it’s way beyond that). This will enable us to move towards truly understanding areas of biology that were hitherto vague at best, and to generate countless targets and drug candidates, some of which will ultimately become therapeutics that can help patients.

On the digital-health front, I think we are finally in a place where patients and institutions are using technology to communicate, understand, and learn how to improve care and outcomes—industry rather than promise. This reality has translated into sizeable companies and transactions.

People call this the “convergence” of tech and healthcare. I don’t love this term, but I believe we all use the technology, resources, and energy at our disposal to pursue our goals, and as technology evolves—and, more importantly, as people discover they can work with others across very different disciplines—the pace of innovation accelerates.

Gila: Looking more broadly, what are the biggest opportunities and obstacles you see for innovation in healthtech?

Anat: In biotech, matching the wealth of insights that emanate from AI/ML and quantum computing with actual drugs is a big opportunity. We can describe the ultimate molecule to fit an exact target but need to find or make it. Similarly, platforms generate countless programs that could be turned into therapeutics. The originators can’t always fund this wealth of options through clinical development, triggering abundant partnering opportunities (which by the way 9xchange could facilitate).

More broadly, I think opportunities come from the injection of technology, capital, business acumen, and scale originating in other industries into solving healthcare challenges. On the care-delivery front, for example, recent acquisitions by big tech of primary-care providers is expected to make telehealth more accessible by integrating digital-health platforms into the way big tech companies interact with customers across their daily lives. Printing and sensing technologies enable testing drugs in mini-organs, and making custom tissue, limbs, and organs for patients. Web3, data integration, synthetic data, and easier communication provide a holistic view of the patient, enable finding the right answers and giving patients more control and actionable involvement. Structurally, the recent trend in the US towards payer-provider integration is critical to prioritizing outcomes by aligning incentives. Opportunities are infinite; there is so much more to do.

Obstacles abound. Top of mind currently is the financing environment driven by challenging markets, in particular for biotech. Other threats come in the form of drug pricing pressure, now a reality, and discussions about democratizing or curbing IP, which are counterproductive in my opinion.

Finally, there can be almost too much focus on certain areas, and too little on others. Investors and pharma are sometimes “trendy”, which creates two issues. First, we end up with impossible competition in certain fields such as oncology, which results in wasted resources as not everything can hit the finish line due to finite resource, connectivity, and ultimate buyers. Second, it ignores the fact that humans are whole beings with many different issues that need a solution, and these could present attractive opportunities. ?

Gila: What do you know now that you wish you had known when you were starting out?

Anat: A lot… Here are some thoughts that come to mind.

First, big ideas and energy matter. Nobody has ever fallen in love with an Excel spreadsheet; people fall in love with people and ideas.

Second, career paths don’t have to be linear. The freedom to create also means freedom to carve out your own destiny. Reinventing yourself every few years is important; otherwise, you stop learning.

Third, It’s OK not to know everything; nobody does. Many pretend, which is counterproductive. Honesty is key.

Finally, it’s easy to talk about perseverance and grit, but the real challenge is managing the emotional “amplitude” that comes with building something novel, and hitting the right balance between listening and being plain stubborn. Someone recently asked a panel I was on: “When do you give up”? The answer is never, but you do need to constantly listen and evolve. Who do you listen to? In the end you hear everything and integrate, which comes back to your own judgement and intuition. It’s about being open- and single-minded at the same time. ?

Anat Naschitz is Co-founder and CEO of 9xchange and a Venture Partner at OrbiMed. She co-founded and co-led OrbiMed Israel, raising two funds with $529m under management, as part of the global ±$20 billion OrbiMed healthcare investment firm. She serves and has served on the boards of public and private biotech, digital health, and medical device companies, some of which she either founded or nurtured from an early stage through IPO/strategic agreement. Prior to that she was an investor at Apax. Anat was an Associate Partner with McKinsey in London, where she managed strategy and M&A projects for senior management of pharmaceutical and biotechnology companies and founded several biotech companies as spinouts. She earned her MBA at INSEAD and her LL.B. at Tel Aviv University.

Disclaimer: The views and opinions expressed in this article are solely those of the author and guest contributor and do not reflect the views of McKinsey & Company.