BioWorld International Correspondent

PARIS - At its annual meeting in Paris, France Biotech, the French biotechnology industry association, issued a "solemn" appeal to the newly elected French president, Nicolas Sarkozy, to "focus his economic policy on a number of major structural, legislative and budgetary objectives that will benefit France's hi-tech industry in general and the biotechnology industry in particular."

In what it described at the "June 19 Call for Innovation," the association maintained that a number of measures were necessary to achieve this objective, the most important one being to implement plans dating back to 2005 for creating a special tax status for young, listed innovative companies.

In addition, it called for the Agency for Industrial Innovation to focus more on innovative small and medium-sized enterprises (SMEs) and for measures to encourage savings to be invested in high-tech sectors.

"Unfortunately, French culture is not oriented toward investment in innovative SMEs, which are wrongly viewed as risky or low-yield investments," observed Philippe Pouletty, the newly re-elected chairman of France Biotech.

The association pointed out that, even though the situation of the French biotechnology industry and hi-tech SMEs had improved over the last few years thanks to a series of reforms (several of them inspired by France Biotech) -- such as improvements in the research tax credit system, unit trust reform, and the creation of the National Research Agency, research foundations and competitiveness clusters -- France was still lagging behind its British, German and Scandinavian counterparts, while Europe had "a long way to go to catch up with the United States."

One particular problem was that France's life insurance industry had not fulfilled the commitment it gave in 2004 to invest 2 percent of its total managed assets in innovative SMEs. The actual figure was only 1 percent, and to bring it up to the target level would require additional investments of €12 billion, noted France Biotech

To get the life insurance industry to invest more of its assets in high-tech industry in return for the tax breaks granted to life insurance-based financial products, "the 2008 Finance Act must instigate obligatory minimum investment thresholds in innovative French SMEs (3 percent to 5 percent over three to five years) to ensure that the anticipated amounts will indeed be invested in the companies concerned," France Biotech said.

The association concluded with the following declaration: "Entrepreneurs, researchers and investors solemnly call on the president of France to accelerate the maturation of the biotechnology and hi-tech sectors by rapidly implementing the appropriate reforms, and without introducing the ceilings and conditions that often remove the substance of a good idea. Implementation of the measures set out here would incontestably create a growth ecosystem generating jobs and social progress. For biotechnology, this progress would directly concern quality of life, health and life expectancy."