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Feature

France feels out the future of biotech

Posted on: 10 Aug 04

Summary

After a period of exceptional performance due to a steady flow of investment in the sector, the biotechnology industry in France was hard hit by the global economic depression of 2002. The government must support the French Biotechnology sector to allow it to assert its position at an international level and to enable consolidation of new start-up companies.

After a period of exceptional performance due to a steady flow of investment in the sector, the biotechnology industry in France was hard hit by the global economic depression of 2002. The industry became more competitive due to a shortage of funding. However, signs of improvement at the end of 2003 and strong economic growth in the USA should help the market to return to some sort of normality – perhaps reminiscent of the growth experienced during the second half of the 80s.

The main characteristics of the French Biotechnology market remain its heterogeneity and its immature nature. The government must support the French Biotechnology sector to allow it to assert its position at an international level and to enable consolidation of new start-up companies. At present, the French sector consists of only a handful of mature companies and a great number of start-ups. The biggest companies, which include the companies listed on the stock exchange, employ on average 100 people and have raised more than €50 million since their creation. They have several products in their R&D pipelines and manage a turnover between €5 million to more than €100 million. Not surprisingly, it is the companies that have the most products in their pipelines that have had the most success in attracting funding for their R&D programmes. Nevertheless the R&D process remains is a lengthy, risk-intense and costly and these companies still face several obstacles in getting potential products to market.

 The majority of biotech companies are still very far from the French leading biotech companies. Most of them have no income and this has consequences for the length of their R&D programmes and the overall maturity of the industry.  A third of the companies have been in existence for less than three years and the number of start-ups continues to grow. Generally, the number of people, mainly scientists, employed in the sector is increasing and the activities are essentially oriented towards life sciences. Thus the future of the French biotechnology sector remains uncertain despite the continuing enthusiasm of existing players and new market entrants. A further worry is that if some of the small French start-ups promise to deliver results but are too weak to fight off competition they may become the targets of bigger companies.

References:

  1. France Biotech «Le secteur Français des Biotechnologies » une étude réalisée sous la direction de Pierre Kopp ; www.france-biotech.org

  1. Deloitte & Touche “Survey on the French Biotechnology Industry 2002” une étude réalisée par Anhoury P.; Gauthier-Dupont J; www.deloitte.com

  1. Burrill & Company « biotech 2003 »; www.burrillandco.com

  1. Ernst & Young “Endurance : The European Biotechnology Report 2003”; www.ey.com

  1. Pierre Kopp & Thierry Laurent “Biotechnologies et haute technologies: le retard français” Rapport pour France Biotech, Juillet 2001 ; www.france-biotech.org

 

Yohan Vezinhet

Last updated on: 27/08/2010 11:40:18

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