LILLE, France - With November gone and winter falling over Europe, it's not too early to begin looking back at 2005 and drawing conclusions.

For Europe, there have been signs that the general biotechnology health is improving. The year's end is still a month away, but already there have been 12 European initial public offerings, according to BioWorld Snapshots, which is a nice increase from the five completed in 2004. In France, another positive sign: Exonhit Therapeutics SA became the first French biotech in six years to conduct an IPO, raising gross proceeds of €7.3 million (US$8.6 million) on the Alternext market of the Euronext stock exchange in Paris, not including the greenshoe option or shares offered to employees.

At the ninth annual European Biotech Crossroads conference held here, the pace is busy and the mood of the estimated 4,000 delegates is fairly upbeat. And why not? One speaker said that while it might be optimistic, there could be "as many as six" biotechnology IPOs in France in the next six months.

Perhaps an increased public appetite for biotechs could bring more European venture capital firms into the game. The knock against Europe has been that it lacks the VC infrastructure to nurture biotechnology, especially considering how Europe wants its biotechnology to grow, which is bigger, better and faster, with one eye always on the U.S.

Europe does trail the U.S., of course - the States have 319 public biotech firms; Europe has just 100, according to statistics from France Biotech. It will take a consolidated effort for the European Union to rival the U.S., or even to ward off Asia, which is rising quickly on the biotech scene.

In a Monday seminar here that stretched into the evening, a group that included members of three European venture capital firms sat and detailed recent trends in investing.

Philippe Grand, an associate with Ernst & Young in France, pointed out that it appears the U.S. will set a record for biotech venture capital investing in 2005. At the midpoint of this year, U.S. VCs have invested nearly $2 billion, ahead of last year's pace. But, Grand said, that's just the beginning in the U.S. where the follow-on funding and IPOs buoy the country's sector further.

That's not the case in Europe.

"VC money is supporting the industry in Europe," he told listeners. "In 2005, it far surpasses IPOs and follow-ons."

Couple that with the fact that the European VC money is flowing into later-stage firms - more than half of VC money is going to second rounds or later, and just 5 percent is going to seed rounds - and it means a "major problem" for Europe, Grand said.

"We face what the U.S. faced 20 years ago," he said.

If that's what is plaguing Europe, what then is the specific problem in France? For a country that has been preaching the positives of biotechnology for years, why has it been six years between initial public offerings here?

Part of it, said Denis Lucquin, managing partner at Paris-based Sofinnova Partners, is history.

"France still suffers from the Genset syndrome," he told attendees.

Genset SA, once the darling of France and a star in Europe, ended badly for investors. As a public entity in the late '90s and into the early 21st century, its shares averaged around €48 apiece. The company, originally a genomics firm, had a lead product in Famoxin, its obesity drug, but when Serono SA, of Geneva, paid €9.75 per share to take over the majority of the company and make it a subsidiary in 2002, most saw it as a life vest tossed to Genset. Although the €107 million deal insinuated a value of just €60 million for Genset with everything considered, one analyst at the time called it a good "way out" for Genset, and suggested that without the buyout, shares soon would be trading at €0.50.

That left a sour taste in the mouths of Genset investors, and it has been difficult to wash out. The way around that, Lucquin said, is to build a French company that is "not too French."

That's done by constructing firms with VC investors that aren't all based in Paris, for instance, and which have at least a presence someplace besides France. A good example is Cerenis Therapeutics SA, based in Toulouse. Formed in March, it also has offices in Ann Arbor, Mich., and its VC base includes Sofinnova and HealthCap, of Stockholm, Sweden, as well as firms from Ann Arbor, San Francisco and Tokyo.

But perhaps the best thing a young European company can do is find a syndicate of VC investors willing to stay on board not just for an A or B round, but until a product has reached the market. That's how strong companies are built, Lucquin said. Investing shouldn't just be about a return or finding the exit at IPO, but about shaping lasting firms across Europe.

Today, Europe uses VC syndicates "much better than the U.S.," said Hubert Birner, a general partner at TVM GmbH in Munich, Germany. He looked down the table at the other panel members, at Lucquin and at Johan Christenson, a partner at HealthCap. "The likelihood that we all end up at the same company is pretty high," he added. "Between the three, four or five of us, we'll take a company all the way" to product approval.

The conference ended Wednesday.