Speedy Innovation in Partnerships
Michael Harsh, GE Vice President and Chief Technology Officer for GE Healthcare, visited Hungary recently to meet local stakeholders and Hungarian colleges. During his travel he explained his idea of how R&D expenditures can be doubled within the next 10 years in Hungary.
Please read the English translation of an interview he gave to Napi Gazdaság, Hungarian economy daily, or follow this link for the original article in Hungarian:
Hungary may double its GDP proportional R&D expenditures within 10 years, but this requires a less bureaucratic, more transparent and predictable incentive scheme, said Harsh, Vice President and Chief Technology Officer for GE Healthcare in an interview to Tamás Leszák, journalists at Hungarian business daily Napi Gazdasag.
- In your opinion, what are today’s biggest challenges in the health sector?
- Healthcare is by far one of the world’s most pressing and complex problems. $4.5 trillion is spent on global healthcare annually, while two billion people have no access to basic healthcare services. The health sector is characterized by aging population, rising chronic diseases and growing demand for tools tailored to local healthcare markets. GE responded to changing clinical, patient and country health needs more than two years ago with healthymagination, a GE business strategy that focuses on reducing the costs of health procedures and practices, improving quality and increasing access to better health for more people through low-cost innovation, education and financing.
- How much money does GE invest in healthymagination?
- GE is investing $6 billion to address these efforts globally between now and 2015. Of this overall $6 billion investment, the company will invest $3 billion in products and services, provide $2 billion in low cost financing to customers, and $1 billion on better health content and solutions. So far, $1.3 billion has been invested in R&D toward the $3 billion goal. The goal is to validate products and services that will bring an improvement of minimum 15 percent in all three areas. Validation will be conducted by Oxford Analytica, a third party firm. By 2015, more than 100 products should be validated. So far nearly 50 new healthcare-related products of GE have been introduced and validated.
- What are the experiences of GE’s $100 million Healthymagination Challenge against breast cancer?
- The recently closed challenge was an open call to action seeking ideas to accelerate early detection and enable more personalized treatment for breast cancer. GE and its venture partners will pledge up to $100 million to fund breakthrough ideas, and the winners will be announced in the first half of 2012.
- What role does the Hungarian R&D center play in the company’s global operations?
- Nearly 200 engineers of the GE Healthcare R&D center in Hungary develop software products of strategic importance for Central Europe and Hungary. These software innovations enable cardiologists and oncologists to diagnose vascular and cancer disorders early on so that treatments promise higher success rates for patients and less expensive procedures for the healthcare system. Heart disease and cancer are responsible for 80 percent of death in Hungary, which is one of the worst death rates for those conditions worldwide. GE Healthcare spends more than $13 million (about HUF 3 billion) every year on R&D in Hungary.
- Are there any plans to expand R&D operations in Hungary?
- GE Healthcare has recently signed a major strategic partnership agreement with Eotvos University in Hungary to enhance education and research & development. The program is partly about a $50 K (HUF 11 million+) donation to the software information technology department of Eotvos University to support its infrastructural development, and it is also about providing students with practice-focused education in cooperation with GE Healthcare. As part of the program, students who excel in healthcare diagnosis modeling will be offered the opportunity to participate in trainee and scholarship programs at the international R&D center of GE Healthcare located in Budaors and later they could have the opportunity to potentially join GE Healthcare’s team of researchers. The advanced research team – which is located in Szeged and maintains close cooperation with the Szeged University Medical Faculty clinics – is focusing on image processing algorithms that enable doctors to segment organs and tumors in an image in seconds. The team will soon move to a new, larger office.
- Recently, you had discussions with representatives of the Hungarian government. What do you think about the future of R&D in Hungary?
- GE is recognized as a partner in the discussion with the Hungarian government as it is shaping a new innovation vision. GE welcomes the government’s intention to close loopholes and implement a predictable and more transparent R&D policy in which large companies having major R&D operations in Hungary are seen by the government as partners. Long term predictability is of primary importance in this regard and we also urge efforts to reduce bureaucracy. Enabled by the recent trends in R&D policy, Hungary may double its GDP proportional R&D expenditures in less than 10 years. This growth can be further accelerated by the existing access to local scientific and technology human capital, by promoting partnerships, and by the acknowledged quality of university education in Hungary.
The number of engineering and science graduates should be significantly increased to provide a continuous talent supply for new R&D investments in Hungary, Mike Harsh emphasized. Also, the current R&D tax benefit system should be improved in order to decrease the direct cost of R&D activities rather than being linked to the operating profit from commercial operations of the given company, Harsh added.