EuropaBio's SME Platform launches a call for action
Biotech SMEs can help lead Europe's economic recovery
Brussels, 27 May 2009 - EuropaBio’s SME Platform has today released “Access to Finance: A Call for Action” (1), a paper highlighting problems as well as recommendations on how to tackle the issue of access to finance in the biotech industry. The Platform, made up of SMEs, national biotech associations, venture capitalists and private banks, amongst others, highlights the concrete financial restraints biotech SMEs face, and offers suggestions on optimizing EU funding instruments for biotech SMEs.
"European Biotech companies are facing a critical financial shortfall which could have profound consequences for the future of Europe’s knowleged-based economy. If these companies fail, we risk missing out not only on innovative and effective treatments, short-changing Europe's patients, but undermine the potential for job creation in a sector which could play a major role in leading Europe out of the current economic slump. For these reasons, it is extremely important for policy makers and the business community to work together to minimize the impact of this downturn and improve technology-based SMEs' access to finance” stated Thomas Saylor, Chair of EuropaBio’s SME Platform and CEO of Arecor.
In the EU, SMEs comprise approximately 99% of all firms and employ about 75 million people. Within the biotech industry, SMEs face particular obstacles, especially due to long and costly development processes. While larger biotech firms already have products on the market, young, innovative biotech SMEs need significant levels of funding to develop a product before commercialization, and this funding has often proved insufficient, especially in the current times of economic and financial crisis. Recent figures show that around 20% of Europe’s biotech companies, the overwhelming majority of which are SMEs, could be gone by the end of 2009 if no immediate action is taken.
The SME platform’s “Access to Finance: A Call for Action” has five main recommendations:
1) Make the EU funding instruments more accessible to biotech SMEs
2) Increase venture capital funding via co-investment
3) Make maximum use of the European State Aid rules in these difficult times
4) Develop measures and opportunities to capture the value of research within Europe
5) Make the EU Framework Programme for Research more attractive for (biotech) SMEs
“All actors, from the EU and its Member States, must work together. Europe’s policy makers need to provide more transparent and easy to use funding instruments. The leading venture capital funds should be incentivised to invest in Europe’s innovative research and development, and EU funding for research (FP7) should be more accessible to SMEs” said Willy De Greef, Secretary General of EuropaBio. “Only when all the sides come together – as they do in EuropaBio’s SME Platform – can solutions be found to ensure that Europe remains globally competitive,” he concluded.
(1) Access to Finance: A Call for Action
EuropaBio's mission is to promote an innovative and dynamic biotechnology-based industry in Europe. EuropaBio, (the European Association for Bioindustries), has 68 corporate and 7 associate members operating worldwide, 4 Bioregions and 25 national biotechnology associations representing some 1800 small and medium sized enterprises. EuropaBio advocates for Small and Medium-sized Enterprises that are in dire need for support at this time and represents over 1800 biotech SMEs via our national associations.