BioWorld International Correspondent

LILLE, France - European Union countries are still spending too little on research, investing no more than 1.9 percent of GNP compared to 2.7 percent in the United States, the European Union's commissioner for research, Philippe Busquin, told the European Biotechnology Crossroads Conference in Lille Tuesday.

And he was applauded when he observed that research was being held back because the "principle of precaution is being taken too far and becoming a pretext for inaction."

In a bid to catch up with the U.S., European Union countries have set themselves the target of stepping up research spending to 3 percent of GNP by 2010 at the latest, and to that end the European Commission's research directorate drew up a 6th Framework Program for Research to help achieve that goal, with human health-oriented biotechnology as the top priority.

Under the program, the EU will provide total research funding of €8.7 billion over the next four to six years (with at least 15 percent going to small and medium-sized companies), and €2.25 billion of the total is earmarked for the biotechnology sector.

But as Philippe Pouletty, president of France Biotech, pointed out, European countries need to double their research and development spending every five years to achieve and maintain that 3 percent target. And in that regard, he gave a red card to the French government, which had decided to cut its research budget by 1.3 percent in fiscal 2003 following a 10-year period during which research spending in France had risen more slowly than in any other European country.

In Europe, Busquin said, there had been a rapid growth in the numbers of biotechnology incubators and spin-offs from academia in recent years, although Europe still lagged far behind the U.S. The EU's 6th Framework Program was a blueprint for creating a "European research and innovation area."

The main problem it sought to overcome was the low level of research spending, Busquin explained. While EU heads of state had agreed on the 3 percent target, national governments had to do their part. And the "economic slowdown has resulted in their taking anti-cyclical decisions on spending and investment." The outstanding exceptions to the rule were Sweden and Finland, where research spending was already up to 3.5 percent of GNP.

The amount spent was not the only problem, since Europe also needed to optimize its research effort through new research scenarios based on greater integration and collaboration, Busquin said. Within the general biotechnology area, he called in particular for increased research in bioinformatics and nanotechnology.

As for the regulatory framework, there were "excessive regulations and procedures where they are not called for and not enough where they are," he said. There was still no agreement on a single European patent, for example, and several EU countries, including France, had failed to transpose European directives regarding patent rights in biotechnology into national legislation.

Funding research and financing corporate development were subjects that bulked large at the conference. While venture capitalists pointed out that biotechnology was at the same state of the business cycle as the information technology industry and that IPOs were thus out of the question at the moment, both large and small companies stressed the benefits of collaboration for maximizing the value and outcome of their research effort.

It was generally agreed that large pharmaceutical companies have externalized 30 percent of their research and development on average, although Rémi Urbain, external discovery director of the Institut Pierre Fabre, the pharmaceutical R&D arm of Lyon-based BioMérieux-Pierre Fabre, maintained that a significant part of that represented the cost of clinical trials. He also sought to lay to rest several myths about the contribution of the biotechnology industry to drug discovery and development.

It was not true that new technology is generating more drugs and therapies, since the annual number of new drug approvals is going down, he said. Nor has biotechnology helped to speed up R&D, since it still takes 12 to 14 years to go from target identification to regulatory approval.

Furthermore, biotechnology was not helping to reduce the cost of R&D, since the amount invested per new chemical entity brought to market rose by a factor of four between 1987 and 2001, he said. On average, Urbain said, only 10 percent to 15 percent of drugs taken into Phase I and 50 percent to 60 percent of those taken into Phase III clinical trials reached the market, so the success rate had not improved. That was partly due to greater regulatory constraints, which required new drugs to demonstrate both significant therapeutic benefit and zero risk.

The conference and exhibition that ends today follows five earlier Biotechnology Crossroads conferences around France that were solely French in scope. But while this annual event now has a European dimension, it will continue to be French-organized and take place in France. Among other things, it is an opportunity for various French regions to promote their local biotechnology research and business activities.

The Lille conference attracted some 3,000 delegates, while 300 companies participated in the exhibition and 180 companies took part in the business partnering convention.