The largest concentration of life science companies in Europe is in Germany, the UK and France, while Switzerland has been rated 'the most innovative country in Europe' followed by Germany, Belgium and the Netherlands, according to a recently released report by KPMG Switzerland, in collaboration with global valuation services group Venture Valuation. The 2015 report, entitled 'Site selection for life science companies in Europe', offers statistics and detailed information on international life sciences companies aiming to expand, restructure or consolidate their activities in Europe. Seven countries – Belgium, France, Ireland, Switzerland, the Netherlands, Germany and the UK – are compared in the report. Life science encompasses the fields of pharma, biotech and medtech.

The countries are ranked on several different criteria, including FDI attractiveness in terms of support for life science companies such as capability strengthening, improvement of agility and increasing company value. The scope for agility offered to companies lies in the flexibility of a country's labour laws and the ease of accessing qualified staff. The UK tops the list in this regard, with nine universities in the global top 100. Switzerland, Germany and the Netherlands also offer highly trained staff and some of the most flexible labour laws in Europe. All four aforementioned countries were cited as being especially strong in setting up educational systems that meet the needs of industry.

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"Diligent and forward-looking tax strategies are important tools to increase the value of a life sciences company", the report said. The seven countries covered in the report are said to apply effective strategies to enhance their business environments in this direction, with all except Germany offering systems that offer beneficial tax treatments of income from intellectual property or incentives for R&D.

In total, the report found that there are 11,000 life science companies across 14 European countries and Israel. Germany has the highest labour productivity followed by Switzerland, and Switzerland and the UK attract the most foreign workers.

By sub-sector, the UK hosts the largest number of biotech therapeutic and pharma companies, and Germany hosts the largest number of biotechnology and medtech companies. Germany also has the largest number of life sciences companies overall, and the largest number of global headquarters. France has hosted more IPOs since 2007 than any other European country, while the Netherlands is reported as being particularly strong in the area of diagnostics and rare diseases.

Ireland is said to have a high manufacturing focus, but the smallest number of life sciences companies, with a small development product pipeline. Meanwhile, Germany, the UK and Switzerland alone accounted for 86% of total European life science funding for private companies, remaining the top performing countries in the report. As Europe works to recover from its recession, its FDI attractiveness and potential in the life sciences sector remains a pivotal area for competitiveness and growth.