French biopharma sector emerging from economic crisis as key player
Core driver of economic and societal development and a strategic growth axis for French industry
The French life science industry is continuing to mature and has come through the global economic crisis well. This is the key finding of the annual ‘Panorama’ survey of the French and global life science industry in 2008/2009 carried out by France Biotech, the French association of life science businesses and their partners.
In 2009, 11 products were on the market and 84 were in clinical development (including 10 in Phase III and 4 in the registration phase), a 20% increase in the number of clinical-phase products in 2008.
The global economic crisis of the past two years has strongly reduced investment levels in the life science industry. The total amount of new venture capital investment fell from €151m in 2008 to €65m in 2009 - a 56% drop. Of the €65m invested, €22m went to seed-phase and Series A rounds of financing, with an average ticket of €1.3m. Even though the total amount of seed funding fell, the number of transactions remained stable (18 in 2008 and 17 in 2009) and emphasised continuing investor interest in life science, the survey found.
In contrast, the value of second and third rounds of financing fell strongly, down from €115m in 2008 to €43m in 2009. Even though the number of transactions remained stable in 2009 (16), the average ticket fell by 76%.
Late 2008 and then 2009 were marked by the French government's stimulus package in response to the global economic crisis, with creation of the €20bn Fonds Stratégique d’Investissement (FSI) sovereign fund in December 2008). The pharma/biotech sector accounts for 10% of the investment opportunities reviewed by the FSI and is the second-ranked industrial sector in terms of actual investments.
The biotechnologies dedicated to health are a national priority, notably with the creation of the Strategic Investment Fund Innobio and the national big loan/grand emprunt, of which 6.5bn Euros are earmarked to support the industry and SMEs. The objective is to strengthen partnerships between public research and industry by creating structures of excellence within an international dimension.
‘France has a head start in the sector of pharma biotech and is today a key player,’ said François Drouin, chairman and ceo of OSEO, which provides assistance and financial support to French SMEs and VSEs in the most decisive phases of their life cycle: start up, innovation, development, business transfer/buy out.
‘This sector has had a major restructuring the past few years, exacerbated by the crisis. OSEO must accompany this restructuring by helping the biotechs to go on the market by accompanying them as far as possible in their development.’
‘The data of the Panorama 2008/2009 confirm the decrease of investments in the life science sector, while efforts of public funding in 2009 have increased and helped the industry continue to grow, thanks to the support of OSEO and the Fonds Stratégique d’Investissement (FSI). We are delighted that the life sciences are recognised as a strategic sector in France and we are hoping that the fundraising efforts will increase in 2010, to make French life sciences a leading player in the world,’ added Andre Choulika, chairman of France Biotech.