Swiss pharmaceutical giant Novartis opened a $175-million biotechnology plant in Hunningue, France, dedicated to asthma treatment. The facility employs 250.

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ollaboration is one of the ongoing themes in the European life sciences sector, especially in funding initiatives, an area that the European Commission has cited as a critical challenge to the industry's future. To that end, several regions and individual countries are developing programs to encourage new R&D.
   Biotech associations representing the Swedish, Finnish, Norwegian and Estonian industries launched a joint project for implementation of Young Innovative Company (YIC) status, which gives companies tax exemptions and allows them to invest the savings in research and development. In 2004, France was the first country to adopt YIC, exempting companies up to eight years old from all taxes and social contributions.
   Germany's Federal Ministry of Education & Research has established a new 150-million-euro (US$175-million) fund to assist young biotech entrepreneurs from Germany and abroad. The ExistGo-Bio incentive program targets scientists with experience in research teams, industrial R&D and clinical settings who are deemed capable of creating biotech startups.
   Austria, Finland, France, Germany, the Netherlands and the Basque region of Spain are pooling funds in a program called Eurotrans-Bio to support trans-national cooperation between companies. The countries have earmarked 39 million euros (US$46 million).
   Critical I, a U.K.-based life sciences consultancy, has conducted several studies on the sector for European government agencies and industry organizations. Critical I is currently analyzing biotech clusters in Europe. John Hodgson, a principal with Critical I, says being in a cluster in Europe offers a lone advantage, albeit an essential one.
   "We looked at the growth, size and revenue of companies and the only distinguishing feature we could see in clusters was access to venture capital," Hodgson says.
   Critical I identifies Europe's clusters as Cambridge-Oxford, Munich, the Bio Valley (an area where France, Switzerland and Germany meet), Scandinavia's Medicon Valley and, to a lesser degree, Paris.
   Hodgson says the ability of governments to put money into new companies is generally limited by EU competition rules. "In general, government money is still being used to leverage private money," he says. "I'm not sure how effective that is. Private investors in Europe in biotech over the last years have been putting back money into their original investments begun in the late 1990s and early 2000s rather than in new companies. There have been a lot of buyouts by U.S. companies that come to Europe with money and pick and choose a bit."
   Hodgson says the desire is present among European nations to compete on the global biotech stage, but the ground still needs to be prepared.
   "They want to compete, but are not prepared to compete," Hodgson says. "They are not recognizing what is necessary and are not preparing themselves accordingly. The tendency is to start companies off when it's cheap to do so and let the market look after the rest. That's not happening.
   "Investors have choices and they can choose whether or not to go into healthcare — and if they go into healthcare, they can choose not to invest in Europe," says Hodgson. "I'm talking very generally — certainly there are companies on an individual basis that are doing the right thing, but it's a lower proportion than you would see in the U.S."