London Tech Week 2023: Health tech and innovation

London Tech Week 2023 is in full force, and one of the key themes of the week is around health tech, and the ways in which innovation can inspire a healthier future. We have seen huge developments in this field, from medical devices, to diagnostics, screening, and treatment, to digital health.

Artificial intelligence (AI) in particular has started to contribute significantly to research and development. It has potential in all sorts of areas:

• Screening and diagnosis – Analysis of samples using AI is often more accurate than a human. It may even find new disease markers that otherwise a human would not have identified. AI is already being trialled for use in cancer diagnosis, in a 2019 study on cervical precancer, an AI system identified precancer with much greater accuracy than human expert reviews, or conventional cytology.
• Treatment – AI is coming on in leaps and bounds in providing accessible, personalised healthcare, whereby treatments are personally tailored to each person. It can do this by crunching masses of data and recognising patterns in it, and is not limited in time, memory, and research skills like humans.
• Lifestyle management – AI algorithms which can process the data from your digital devices into useful action points can help us all to lead healthier lifestyles, and potentially even detect warning signs. For example, a company in California has combined stethoscopes, powerful software and AI to help detect heart murmurs or turbulent blood flow.
• Target identification and modelling – There is great potential for AI to assist with research and development. It can help model what a virus looks like, what epitopes might be exposed, and so what make good targets. In 2022, DeepMind announced that it had successfully predicted the structure of almost all proteins using its AlphaFold technology. This sort of technology is ground-breaking, and has the potential to speed up drug discovery and development and assist in the creation of a new generation of treatments.
• Repurposing -AI may be able to take a given drug and process masses of information to locate other receptors in the body upon which the drug might have an effect, thereby leading to a new treatment use.
• Clinical trials – AI can help design and administer clinical trials at the moment, but an exciting new idea is whether in the distant future, we could model the systems and the interventions so that it could predict results with enough accuracy that it could produce acceptable evidence of efficacy and safety.

So if you have a great piece of technology, how can you protect it, and exploit its value?

Protecting your technology and its outputs

A key consideration, especially in the healthcare technology space, is your IP strategy. How do you ensure that your data, AI systems and their outputs are adequately protected? The key here is to understand that there is usually more than one way to protect them. The benefits of each depend on the nature of your technology and your future plans for the business.

• Scope out where the value sits. Data, AI technology and outputs may be of paramount importance. But do you also have valuable designs, databases, or brand identity?
• Evaluate your options for protecting key assets. Do you see benefits in applying for patents, or could they be better protected through trade secrets? Trademarks, copyright, design rights, and database rights can help protect valuable ancillary assets.
• The rapidly expanding use of AI in life sciences has focussed attention on the importance of training data and AI-related assets and, with these, a recognition of the relative importance of protecting trade secrets through contract, policies, procedures and staff training. For an industry where the “patent is king” they may also need some dedication to changing hearts and minds, explaining the limitations of patent protection and why the extra efforts to keep secrets safe are justified.
• Seek the appropriate protection. Some IP rights, like copyright, and unregistered design rights, will automatically apply. You will need to make a formal application for others, like patents and trademarks.

Regulation is absolutely essential to get right in the health tech sector, from CE marking to environmental claims, to marketing and advertising. The following factors are important starting points to consider:

• Following the correct regime – The correct process to follow to get your technology to market will depend on the territory in which you plan to market your technology. Each territory will have its own regulator and its own product review process. It is important to familiarise yourself with the relevant legislation and guidance for each market you wish to enter. In the UK, the regulator is the Medicines and Healthcare products Regulatory Agency (MHRA), and the main legislation is the Medical Devices Regulations 2002. The EU body is the European Medicines Agency, and the US body is the Food and Drug Administration (FDA).
• Safety – Although the regulatory process will differ in each territory, every regulator will require evidence of the device’s safety. The level of risk allowed will be dependent on the technology in question and the approach of the regulator. Make sure your technology is sufficiently tested in line with regulatory requirements. If you are unsure of the requirements for your device, contact the regulator directly.
• Post market monitoring and reporting – Think not only about what is needed to get the technology to market, but also the requirements after. There will often be reporting requirements such as the reporting of adverse incidents. In the UK, medical device suppliers and manufacturers must report adverse medical incidents to the MHRA, which they can now do online using the Manufacturer’s On-line Reporting Environment (MORE).  You also have to update the MHRA when you have made changes to your registration, for examples, if your product or organisation details have changed. This is likely to be the case in other jurisdictions as well. 
• Marketing and advertising of a device – There are restrictions on the marketing and advertising of healthcare technology which will differ in each country, so you need to be aware of these. The Association of British HealthTech Industries (ABHI) has provided “Guidance for Medical Device Advertising” detailing the conditions that need to be met in major EU countries and the UK.
• Changing regulation – As more and more pioneering health technologies are invented, regulators will frequently review their processes with the aim of making sure the public is adequately safeguarded, yet at the same time, encouraging developers to market products within their territory. You should stay alert to regulatory changes that could affect your company. For instance, during the 2023 Spring Budget, the Chancellor outlined reforms to the regulation of medical technologies in the UK stating that from 2024 the MHRA will move to an alternative regulatory model “which will allow rapid, often near-automatic sign-off for medicines and technologies already approved by trusted regulators in other parts of the world such as the United States, Europe and Japan.”

Exploiting its value

The time may come where you seek investment into your company, invest into another company or even acquire rights from a company. It is worth considering that the UK Government has made several grants available for AI innovation in particular – these should be a starting point, especially for new technologies.

There is no single route through which you can seek investment, and each will bring different benefits and risks. You should seek professional advice for your individual position.

• Business grants – Several different schemes exist for small businesses to attract grants in certain sectors. They also often offer extra support and advice. The Department for Business and Trade has a list of support which you can filter by ‘grant’ to see which may be available for your specific business.
• Crowdfunding – This method of fundraising from the public has been climbing in popularity, and a number of platforms such as Kickstarter and Crowdcube now exist, through which you can launch your efforts.
• Business loans – Most banks offer small business loans to businesses, if you are able to meet their requirements.
• Private investment – Wealthy individuals are often interested in taking equity holdings in exchange for seed investment. It is often useful to work with brokerage firms to secure this type of funding.
• Venture capital investment, e.g. SEIS – There are a few venture capital schemes run by HMRC, but the most relevant for health tech companies would be the Seed Enterprise Investment Scheme, through which you can receive up to £250,000 in funding.

You may also decide to either license your technology to, and/or combine forces with, another company or institution. A normal straight licence can be relatively simple, whereas with collaborations, you will have a shared goal in mind and both have parts to play in achieving this. They are effectively joint ventures. Some examples of collaborations using AI technology could include new biological target identification, drug development, and/or commercialisation of new drugs.

These agreements can be complex, and you should consider a number of key points:

• Initial targets (collaborations only) – What are your joint priority targets or disease areas?
• Exclusivity –  Are you looking to separately exploit your technology with others, or are you happy to agree to an exclusive licence?
• Territory – In which territories will your agreement operate?
• Duration – What will the initial term be? Can it be extended? Will a party be able to terminate early?
• Payments – How will you structure the payments? Collaboration and licence agreements often entail upfront payments, as well as payments upon the completion of milestones, and royalties. But if the parties are sharing costs and intend to share profits then the agreement will need to include provisions detailing how the parties will calculate and share profits and losses.
• Use of the technology – What are the actual limits of the use of the technology that will be granted?
• IP ownership and licensing – Who will own new IP that is created? Jointly or created jointly or will there be a carve up on technology lines?
• Governance – In collaboration agreements, you will need to include a structure to govern the relationship of the parties, normally achieved through a joint steering committee or similar body that will have certain operational decision making powers.

If you have any questions about this article, please get in touch with our Tech team.