France Biotech presents the results of its tenth annual "Life Science Panorama 2011" survey, conducted in partnership with Ernst & Young
a Sector in Need of New Growth Solutions
- A Dynamic Sector Mainly Made up of Small Structures
- Companies Struggling to Finance Themselves and Attain Mid-Cap Status
- a Future Focused on New Growth Solutions
Paris, Tuesday, 23 May 2012 - France Biotech, the French association of life science companies, in partnership with Ernst & Young, published for the 10th year running the 'Life Science Panorama', describing the industry's main trends for 2010/2011 in France and worldwide. This time, almost 200 French companies took part in the survey. The panorama highlights the maturity threshold attained by the life science industry, equivalent to that of the pharmaceutical industry thanks to a wide variety of highly sought-after products. It also focuses on the first acquisitions of foreign companies by French companies and the first takeovers of listed French companies. In this time of crisis, France has clearly demonstrated the momentum of this sector, but will it run the risk of decline in the years to come due to reduced financing?
'In spite of the difficult period we are going through, our sector is proving its vitality. Its turnover is continuing to increase significantly and it is entering into partnerships with high potential. Will venture capital, which remains THE source of financing for the expansion of our industry, be able to meet the needs of the sector, taking into account the unprecedented drop in financing observed in 2011? The capital strength of our companies will be the fundamental means of support for growth, so that we may continue to take on staff, innovate and post solid performances. France Biotech has warned the Government about the impact of the innovation grant reforms, which have blocked the path of many of our fast-developing companies, and may continue to do so. Each SME in our sector is a large company in the making. France Biotech will continue battling to get the Government to review its standpoint on the recent reforms and will remain vigilant as regards future reforms,', stated André Choulika, Chairman of France Biotech.
France ranked 2nd in the world (source: OECD) in terms of number of life science companies
There are 1,359 life science companies throughout France. They are mainly located in the Ile de France region (33% as in 2010), the Rhône-Alpes region (15% as against 16.6% in 2010) and the PACA (Provence-Alpes-Côte d'Azur) region (8.2% as against 10.5% in 2010). It should be noted that 6% of these companies are in the Midi-Pyrénées region and 6.6% (4.9% in 2010) in the Loire region, a trend boosted by the centre of competitive excellence. AND 48.5% of the French companies are from the academic sector.
Biotech companies, real growth opportunities for the pharmaceutical sector, with partnerships still on the up
Over the past few years, biotechnology companies have become the main potential for growth for the pharmaceutical industry, now the largest client of innovative companies (33%), along with public research laboratories.
85 partnerships were entered into in 2011. Biotechnology companies often stem from an academic discovery and then remain closely affiliated with their laboratory of origin. The percentage of partnerships stemming from academic research rose from 49% in 2010 to 52% in 2010, showing an increase in this field.
A sector struggling to finance itself and attain mid-cap status
The financing of French companies in the sector1 (via venture capital, IPOs or refinancing on the financial markets) dropped sharply between 2010 and 2011, falling by 40% from €460 million to €277 million. This trend could also be observed in the biotech sector in Europe, where financing fell by 36%.
In parallel, the companies questioned continue to overwhelmingly favor the various tools made available to the public authorities (Oséo - French state innovation agency, C.I.R. - tax rebates for research), whilst underlining, however, the extremely negative impact of the reform of the Young Innovative Company status.
"As financial resources continue to dry up, companies in the sector will have to develop more rapidly. Therefore, concentration phenomena could increase, or we may be faced with the development of the 'open innovation' phenomenon,'" concluded Franck Sebag, a partner at Ernst & Young.
1 This year, the study analyzed biotechnology companies and companies in the medtech sector
About France Biotech
France Biotech (www.france-biotech.org) is the French association of life science businesses and their partners. Its mission is to help the French life science industry to achieve a leading position in Europe. France Biotech is a driving force for change; it lobbies public authorities, economic organizations, academic research, the media and, particularly, the investor community in order to encourage the emergence of biotechnology as a top-priority, hi-tech industry and to improve the economic, legal, regulatory and managerial environment of these businesses. France Biotech currently has 150 members. The association's corporate members account for the vast majority of the investments, employees and innovative products in France's life science sector.
About Ernst & Young
Ernst & Young is a global leader in assurance, tax, transaction and advisory services. Worldwide, our 152,000 people are united by our shared values and an unwavering commitment to quality. We make a difference by helping our people, our clients and our wider communities achieve their potential.
Ernst & Young refers to the global organization of member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit www.ey.com.
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2011 highlights in France
• First acquisitions by French companies abroad: Cellartis (Sweden) by Cellectis and Humalis (Japan) by Vivalis
• Acquisitions of two of our companies by foreign companies: Novagali Pharma by Santen and Ipsogen by the Dutch company Qiagen
• A French company acquired by Biomerieux, Argene
• Number of employees: 4,229 , 33% of whom hold Master's degrees ;
• Number of companies: 1,359 ;
• Number of companies more than 10 years old: 5% (38 out of 189 companies) and 43% between six and 10 years old (82 out of 89 companies) ;
• Average number of staff: 27% have between six and 10 employees and 25% from 11 to 30 employees ;
• Total sales: €261 million for 103 companies ;
• R&D Investment: €104 million ;
• Companies created: 24 ;
• Placed into court-ordered liquidation: 25 in 2011.
• Young Innovative Companies (YICs): 51%.
2011 highlights in France
• First acquisitions by French companies abroad: Cellartis (Sweden) by Cellectis and Humalis (Japan) by Vivalis ;
• Acquisitions of two of our companies by foreign companies: Novagali Pharma by Santen and Ipsogen by the Dutch company Qiagen ;
• A French company acquired by Biomerieux, Argene.
A rich product pipeline
Therapeutic products: The industry saw its product portfolio grow larger in 2011 with 320 products in development (compared to 212 in 2010). 20 products are being marketed, compared to 11 in 2010. 43% of products are in proof-of-concept phase: 32% and 19% are in preclinical and regulatory phases. While the R&D effort in oncology remains high (12%), the gap with other therapeutic areas has narrowed.
Diagnostic products (59 in-vitro diagnostics and 21 in-vivo diagnostics): the majority of which are in oncology. The two other well-represented therapeutic areas are central nervous system and immune system diseases.
Medical devices (10 implantable medical devices): oncology is also in first place, followed for the first time by the cardio-vascular system and surgical devices, with dermatology and the digestive system coming in third and fourth.
Out of 190 companies, 129 stated that they had been granted subsidies in 2011 and 51 companies stated that they had been granted investment subsidies.
• 97 companies stated that they had been granted operating subsidies ;
• 112 stated that they had been granted repayable advances ;
• 90 had been granted subsidies by OSEO ;
• 51 had been granted subsidies out of France's National Bond Scheme ("Grand Emprunt") ;
• 50 companies had been granted subsidies by the French National Research Agency ("ANR") ;
• 21% of companies received subsidies from the French Environment and Energy Agency ("Ademe") ;
• 20 companies received subsidies from European programmes.
Key figures on financing
The FSI-PME programme, implemented for SMEs on 5 October 2009, is managed by the FSI and OSEO.
€2.4 billion committed in 430 companies in 2010 with :
• Direct investments in 21 companies for €1.7 billion ;
• Investments by funds created by the FSI in 65 companies for €200 million ;
• Investments by partner funds in 340 companies for €500 million.
In our industry, in 2011, the FSI directly invested in :
• Cellectis for €25 million ;
• Novasep for €30 million.
In 2011, Innobio (created in late 2009 and focussing on innovative life science companies) invested in:
• Advicennes Pharma for €3 million ;
• Eyevensys for €650K.