Nine of the country's top medical institutions are merging to create a medical research institute modelled on a UK version which changed AIDS from a "death sentence" into a "chronic disease".
Australia's first academic health sciences centre will bring together three major teaching hospitals, four research institutes and two universities co-located at the Randwick Hospitals Campus in Sydney's east.
The Academic Health Sciences Centre is expected to bring a major change to the way health research, teaching and treatment are carried out in Australia.
The collaboration is a first for Australia, but similar partnerships have been established successfully in North America and the UK.
"We saw the way that the healthcare and research fraternities confronted the HIV epidemic," said Professor Robin Ward, director of Prince of Wales Hospital Clinical School and one of the first people involved in the Randwick centre.
"With researchers, educators, clinicians and the community coming together, what was once a death sentence was transformed into a chronic disease.
"We intend to do the same across the medical spectrum," he said.
The institutes involved are the Prince of Wales Hospital, the Royal Hospital for Women, the Sydney Children's Hospital, Randwick, the Children's Cancer Institute Australia, Neuroscience Research Australia, the Black Dog Institute, the Eastern Health Clinic, University of NSW Medicine and University of Technology Sydney faculty of Nursing, Midwifery and Health.