Paris

France has announced a plan to bolster its lagging biotechnology sector by injecting fresh public money into private biotech companies.

Presenting details of the plan to parliament last week, finance minister Laurent Fabius said that the government will provide 60 million euros (US$54 million) next year for new biotechnology start-ups, and an additional 90 million euros in loan guarantees for more established companies.

Fabius hopes that the money, provided as part of the 2002 budget outlined by the Ministry of Finance in October, will be supplemented by the European Investment Bank. It will be invested in ventures that have already obtained some initial funding.

Mind the gap: in 2000, France lagged behind its rivals in private-sector biotech investment. Credit: FRANCE BIOTECH

The government hopes that its actions will enable France to emulate Germany, which has doubled public investment in biotechnology over the past five years and taken over from Britain as Europe's leader in private biotechnology investment (see graph). France says it wants to overtake Germany by 2006.

“The announcement has generated a lot of enthusiasm in the industry,” says Philippe Pouletty, president of France Biotech, an industry association that has been lobbying the government over what it regards as under-investment in biotechnology.

“The 2006 objective is realistic,” says Thierry Laurent, an economist from the University of Évry-Val d'Esonne near Paris. But he says that other sources of investment, such as the national health insurance fund, need to be tapped if the objective is to be met.

The government hopes that the 90 million euros in guaranteed loans will leverage up to 450 million euros of private investment in French biotechnology companies.

Publicly funded research in life sciences, which receives a quarter of France's total research and development budget, stands to benefit indirectly through more technology transfer with the biotechnology companies. “This is an exceptional opportunity for the public sector,” says Bernard Pau, director of the biotechnology institute at the University of Montpellier.

The number of start-ups founded by academic researchers in all disciplines in France has increased fivefold since 1999, when a law was passed allowing publicly supported researchers to become shareholders in companies linked to their laboratories (see Nature 397, 187; 1999).