Fact Check

European biotech: straggling ahead

For the biotech industry worldwide, the past few years have been stressful. The science is sizzling, but business is tough for many: mergers, cash shortages, gyrating share prices, regulatory tangles. And as always in the business of science, it's tougher in Europe than in the U.S.

An especially detailed analysis of the European biotech industry was released earlier this year by a UK consulting firm, Critical I Ltd., and EuropaBio, a trade association for the European biotech industry. Among the highlights:

• Germany is tops in Europe for sheer number of biotech companies: 525 to Britain's 455 (see chart above) at the end of 2003. But for economic heft, the UK comes first with 22,405 people employed in the biotech industry (of which, 9,645 are in R&D, representing 32% of the European total.)
• Employment in the European biotech sector slipped 4% to 94,000 in the most recent year, 2003, for which full data are available. By contrast, the US industry - which employs about twice as many people as does Europe - was recovering from the slump of 2002.
• Generally, European biotech companies are smaller and poorer than their US counterparts. For instance, for maturing companies 6 to 10 years old, the typical European firm has 70% as much revenue as the typical American company, has half as many employees and researchers, and has half the research budget. By sheer number of companies, the score at the end of 2003 was: Europe 1,976, US 1,830.

Quote: "The USA is the largest biotechnology power in the world. The best that European national pretenders can hope for is a distant second place. However, as a collective group, Europe has the potential - in science, financial muscle and on a commercial footing - to challenge the USA."

Follow-up: www.criticali.net