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Amid a national debate over how to reform scientific research and boost innovation, a leading voice for French biotechnology has been meeting with government ministers to help close France's biotech gap with the United States and Britain.
Under special scrutiny is a proposal for greater tax breaks to help young biotechnology companies. Philippe Pouletty, chairman of the industry group France Biotech, has met with Finance Minister Herve Gaymard and other top government officials to discuss broadening a year-old tax incentive program for technology companies.
The proposal for special tax status for "young listed companies" ("jeunes entreprises cotees") would help companies after initial public offering (IPO), expanding on a program that now helps companies before IPO.
France has only six listed biotechs, compared to more than 46 in the United Kingdom and some 310 in the United States, according to France Biotech. Pouletty says what's needed is a new way to prod France's traditionally risk-averse investors into investing in young biotechs.
"Either we wait for them [investors] to wake up or we give them vitamins and strong coffee," Pouletty told The Scientist. "And the strong coffee is a strong package of tax incentives."
The plan would give investors and shareholders in companies with less than €150 million (USD $195.4 million) in annual revenues and with fewer than 2000 employees breaks from capital gains taxes, inheritance taxes, wealth taxes, retirement, and other "social" costs 8 years after a company goes public.
Pouletty says the tax plan is part of a multi-pronged effort to boost France's flagging biotech industry that includes stimulating academic research and promoting high-tech hubs. Wider efforts are also underway to consolidate Europe's markets and to ease regulatory barriers to help European technology companies grow.
Some scientists are skeptical about tax breaks for biotechs. Jacques Fossey, secretary general of the National Union of Scientific Researchers, told The Scientist that tax breaks may not work for French biotechs because the French system is more geared to directly subsidizing industrial giants.
"We don't have anything against helping young companies, but we are not sure that in an organized economy like the French economy, it is the best thing," Fossey said. "In France, we have a real cultural problem. We are not used to functioning in a system that gives small companies tax advantages."
Alain Guedon, a vice president of France Biotech, said the tax incentive plan is promising, but not enough on its own to revitalize the French industry. "What is absolutely necessary are investors and venture capitalists specialized in biotech, and that we do not have at all in France," said Guedon.
An even greater hurdle is a deep cultural aversion to making a profit from health, which is shared by many French scientists and investors, Guedon said. "In the US, people recognize that profit is not detestable," he said. "In France, profit in the realm of health is not considered moral."
The tax incentive plan has been in the hands of the French finance and budget ministries since mid-December (December 14.) Ideally, it will be included in the new law on research and innovation due before Parliament this spring, Pouletty said.
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