Sheba Medical Center Sells Global Innovation Arm for Tens of Millions

Sheba Medical Center has announced the sale of its global innovation arm, ARC Global, to the American company Redesign Health. ARC Global specializes in consulting and supporting the establishment of innovation centers modeled after Sheba's ARC system in hospitals worldwide.

Under the agreement, Sheba will receive an immediate payment of several tens of millions of dollars and will retain a shareholder stake in the joint venture. Professor Eyal Zimlichman, Sheba's Chief Innovation Officer, is set to become Vice Chairman of Redesign Health, while Dr. Steven Klasko, former CEO of Jefferson Health, will serve as Chairman. Details of the full agreement were not disclosed, but Sheba stated it will continue to benefit from the joint venture's successes.

Launched in 2019, the ARC innovation center has fostered the creation of dozens of companies, some achieving successful exits. Its leading product, however, is the innovation model itself. Initially, Sheba collaborated with international hospitals seeking to adopt its innovation model, which evolved into a global network for cooperation and information sharing. In 2023, Sheba decided to commercialize these capabilities, establishing ARC as a dedicated arm to launch similar innovation centers in other hospitals, in partnership with the international consulting firm Deloitte.

Redesign Health focuses on establishing venture funds alongside hospitals to support medical ventures. The company is involved in numerous funds and investment projects, having raised approximately $3.5 billion for itself and its affiliated funds to date. In 2024 alone, it raised $175 million for its own venture capital fund. The company is led by CEO Brett Shachin, a former investor at Goldman Sachs, Carlyle, and Lone Pine Capital.

Avner Halperin, CEO of ARC Global, explained that the initiative to find an international partner to expand ARC's global reach came from within. Redesign Health was chosen for its proven experience in raising capital and assisting hospitals in company formation. Halperin emphasized that Sheba's focus remains on its Israeli operations, and the partnership will allow their network's companies to access more markets and data. He also noted a trend towards "co-opetition," where industry players collaborate for mutual advancement while also competing.

The sale was announced during the ARC Summit, a prominent health conference in Israel. Sheba also recently ranked sixth on Newsweek's list of the world's smartest hospitals for its integration of AI, robotics, and telemedicine. Within Israel, ARC currently supports over 130 startups, with eight exits and three unicorn companies created, boasting a cumulative portfolio value of approximately $6.7 billion and over $1.5 billion in funding raised.