Country Report: France, Part II

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FRANCE PART II: Creativity Rules

There is much that is instantly likeable about French healthcare and life sciences. Many laud the country's highly distinctive 'Autorisation temporaire d'utilisation' (ATU) system, an ingenious mechanism for granting rapid access to state of-the-art therapies, that Bristol-Myers Squibb (BMS) Senior Vice President Europe and General Manager France Jean-Christophe Barland heralds as "unequivocally brilliant" in its capacity to circumvent the traditional sluggishness of drug reimbursement and "trigger wins for patients, the medical community and medicine developers alike." Others acclaim the French public health system for its staunch adherence to the principles of universal provision and enhanced access to innovation: tenets that Thomas Fatome director of the nation's Social Security reassures are "permanent and inviolable." However, if there is one single attribute that rings louder than the rest, then that would, no doubt, have to be the country's intense penchant for 'creativity'.

Jean-Christophe Barland - senior vice president Europe & general manager France, Bristol-Myers Squibb (BMS)

"When we contemplate Germany, the automatic perception that springs to mind is the idea of robust, hardwearing products and quality engineering. Though France does not yet possess an equivalent ready-made stock image quite as strong as this, we have made it our key mission to create one and this has led us to initiate the campaign 'Créative France', because ultimately what really singles us out from other nations is our pioneering spirit, excellence in innovation and underlying creativeness," recounts Muriel Pénicaud, France's Ambassador for International Investment and CEO of Business France.

Pierre-Henry Longeray - president of biopharma activities, Merck France

France's legacy as an innovator in the healthcare and life sciences field certainly looms large over its neighbors with an enviable track record for premiering novel, first-of-a-kind therapies such as the creation of the first artificial heart and a formidable network of globally acclaimed medical universities and research institutions that have, over the years, spawned many scientific Nobel Prize winners. Moreover the country's reputation as being ahead of the curve in both pharmaceutical development and in pioneering fresh styles of healthcare provision remains equally relevant today.

Eric Le Roy - director general, SNITEM

"The French culture of innovation actually counts as one of the principal drivers of our business and explains our profound engagement with the country," reveals Pierre-Henry Longeray, president of biopharma activities at Merck, an enterprise itself notable for being a trendsetter in repositioning itself as a science and technology company. "If you have an innovative product, the probability of a successful launch and embracement by medical professionals out here are really very high, even in a highly competitive market...French key opinion leaders are extremely aware of innovation to the point that they even proactively look for it," he enthuses.

Stephane Regnault - president, Vygon & president, SNITEM

BMS' Jean-Christophe Barland paints a very similar picture about the French market's receptiveness and welcoming attitude towards fresh ideas. "One of the most attractive elements about the French market has been the undeniable quality of the scientific research environment... several of the top oncology institutions in the world are to be found right here, making it extremely important for us to be present working with them as we completed our transformation from traditional Big Pharma to Biopharma and as we continue to pioneer our highly successful chosen field of immuno-oncology: a domain formerly written off by some as fringe and only for eccentrics!"

Philippe Chêne - president, Winncare

Perhaps indicative of France's enthusiasm for innovation, a full nine percent of inward investments are currently directly towards R&D operations according to the latest statistics from Business France, while France's research tax credit also tends to act as a real draw for multinationals. "France's sheer commitment to innovation, especially in healthcare, is a considerable strength. The prevailing tendency to allocate resources towards R&D results in a system with high capabilities for the acceleration of treatments from research and clinical trials to the market, and that's precisely why we're so keen to be participating," notes Philippe Chêne, president of the medical device producer, Winncare.

Alain Bertheas - president, Sigvaris

In many respects, the country's pro-innovation stance and friendly, enabling ecosystem is likely to become all the more decisive in attracting foreign investment in a world in which R&D is no longer conducted solely in-house. "Innovation in healthcare has already gone global... healthcare is a mature, resource driven business, therefore, research could potentially be local but development is so incredibly costly that it is now only feasible to be undertaken globally," proclaims Longeray. "It would be virtually impossible today for a single company to master all the facets needed to provide innovation given the combinations of different vastly distinctive technologies required... it's hard to imagine any start-up even becoming a global company in healthcare, in this day and age," he muses, pointing to Merck's own headline making hook-up with Pfizer in immuno-oncology as a sign of things to come.

Lucile Blaise - VP Western Europe, ResMed

PROACTIVITY AND PREEMPTION

One area where France has certainly been blazing new trails is in championing preventative healthcare and advanced use of diagnostics. According to Eric Le Roy, CEO of the National Association of Medical Technologies Industry (SNITEM), France enjoys a vibrant medical devices industry that has been making much headway in furthering the cause of preventative healthcare. "We're talking about a market segment employing over 65,000 people in France, worth over EUR 19 (USD 21) billion whose contributions are absolutely game-changing; increasing out-patient care, decreasing hospital stays and fostering patient autonomy thus simultaneously taking costs out of the system and improving patient satisfaction."

Marc-Alexander Burmeister - president & managing director, B.Braun France

Indeed stories abound about locally active medical device companies making headway towards attaining these goals. Rather than focusing on treatments, Winncare, for instance, has positioned itself in the preventative care market, providing pressurized mattresses specifically to mitigate the onset of complications arising from bedsores. "In France alone, bedsores are the source of costs spiraling as high as EUR 4 (USD 4.5) billion per year and as the French population ages the issue will only get worse...All too often national healthcare budgets allocate funds to treat pressure ulcers, yet rarely channel money into preventative measures, but in France we are now collaborating with entities such as SNITEM to demonstrate the positive contribution our pressure mattresses can elicit," explains president Philippe Chêne.

Eric Thepaut - SVP & president Europe, Boston Scientific

Meanwhile Resmed has been playing a unique role in countering sleep apnea and respiratory related disorders through the deployment of latest-generation diagnostics. "Around the world, few doctors realize the true dangers of Obstructive Sleep Apnea, a silent killer that interacts closely with a lot of comorbidities such as diabetes, cardio vascular disease and, according to recent studies, potentially even cancers.... at ResMed, we have thus been focusing on providing the diagnostic abilities to help treat these conditions, proclaims Lucile Blaise, vice president for Western Europe. "Whereas merely a decade ago cardiologists on the local market were pretty much unaware of these factors, now the detection and addressing of sleep apnea among cardio patients has become routine procedure," she proudly acknowledges.

Christophe Lala - general manager Western Europe, GE Healthcare

Another success-story, Sigvaris, has been countering the lifestyle-related rise in disorders associated with venous inefficiency through the promotion of compression stockings. "Already a full 50 percent of all women and 25 percent of men are vulnerable to venous insufficiency and these stats are expected to increase, yet our technology offers a completely natural solution, allowing the patient to forego drugs entirely," states the company's president, Alain Bertheas. "Conscious of the need to win over and obtain the compliance of the end customer if this historic technology were to become widely adopted as a viable solution, Sigvaris made it its business to develop a wearable, medically efficient, comfortable all day long, and aesthetically pleasing product," he recalls. The end result has thus been a solution that not only generates economic savings by obviating the need to resort to expensive medications, but also one that is patient centric.

Prevention is simultaneously being championed from other quarters. Lille based family-run Anios, for example, has gained global renown for their advanced disinfectants that combat nosocomial infection and devices to monitor the effectiveness of hand washing. "It's not just an issue of gaining access to high quality disinfectants because levels of awareness of hygiene and its importance differ from country to country...infection control in France performs well compared to Southern Europe, but worse than in the Nordic countries where it is very cold and microbes have less chance to grow," explains CEO Bertrand Letartre who has been rolling out an initiative across France in which nurses are dispatched to hospitals to deliver training and test out the effectiveness of hand washing.

Where there is still much room for improvement, however, is in state reimbursement of medical devices. "Even as policymakers register their approval of the concept of preventative healthcare, public health expenditure remains stubbornly disproportionately channeled towards the treatment of disorders rather than preventative measures of health complications," warns Winncare's Chêne. "This is because reimbursements tend to be granted based on the results of clinical studies, or evidence-based medicine, and it is technically very difficult to evaluate the effectiveness of a medical device in comparison to a drug," he explains.

Elie Lobel - CEO, Orange Healthcare

SNITEM's Le Roy very much agrees. "A drug either works or it does not. In most instances, medical devices, by contrast, do not work alone. For the patient, differentiating between the work of the doctor and the work of the medical device can be extremely challenging. The results of a pharmaceutical product are clear to see, but this is not really the case in our sector, where the clinical outcome is a result of a close combination from the product and the practitioner."

Gilles Pacaud - managing director, Rockwell Automation France

"What's more, demonstrating the effectiveness of a preventative healthcare device requires large amounts of observational data and this can lead to clinical studies facing prohibitively high costs, especially for small companies, which creates an added complication," concludes Chêne.

Lyon Panorama. Credit: ©F.Lacrabere VISUCREA

UNLEASHING CREATIVITY IN MEDICAL DEVICES

Medical devices is an area in which France has tended to be at its creative best. "Historically speaking, it's important to remember that the first coronary stent implant and the first ICD implant were actually both conducted here," points out Eric Thépaut, president for Europe at Boston Scientific. Referring to Europe as the "growth lab of the company" that "represents 21 percent of overall sales and truly sets the tone for the rest of the world," he regards France as an "epicenter of avant-garde scientific thinking" and thus an obvious choice of location for the company to be developing and innovating a new portfolio of technologies that encompasses endoscopy new age visualization systems and neuro-stimulation devices for deep brain stimulation.

David Kimelfeld - vice-president in charge of Economic Affairs, Lyon Metropole

GE, which maintains its second largest number of employees in France, (second only to the US) represents yet another company betting big on French innovation. "Given that France, throughout its history has been at the heart of much of the world´s medicinal progress, we are confident that the country will play a decisive role in defining new healthcare models of the future which will clearly entail early diagnosis and individually tailored treatments and delivering appropriate treatment to the patient at the right time," explains the general manager of Western Europe at GE Healthcare, Christophe Lala. His aspiration is that GE should be able to position itself as a "key partner and enabler in supporting this grand endeavour."

Clémence Labat - life sciences director, Lyon Metropole

Interestingly, in spite of its increasingly vibrant medical devices sector, France has not yet proved able to nurture a homegrown medical devices giant akin to those that dominate its pharma sector, such as Sanofi and Servier. "Historically, France has possessed iconic medical device companies, yet many of them have been acquired and absorbed by large foreign multinational firms," explains Stéphane Regnault, CEO of the disposable medical device producer, Vygon and president of SNITEM. "While the country has displayed exceptional foresight in the field of medical devices and implants – with notable inventions including the first hip implants as well as the ports used in oncology procedures – France has systematically proved incapable of properly building upon and commercializing these inventions into industrial successes" he regrets.

Philippe Archinard - president, Lyonbiopole

One explanation for this may well be the difficulty encountered by young companies in securing financial backing. "Perhaps in the initial stages of start-ups, it may be possible to receive capital to initiate business activity. However, to make the transition into the international market, and to grow into a medium sized entity and become an industrial player in the true sense, much larger sums of capital are necessary and securing that level of capital on the French market is pretty tough," reflects Regnault.

Greater levels of public-private partnership could perhaps help to offset this. "In Germany there is a strong sense of commitment from the government to private enterprise and the private and public sectors align and work together to establish laws and pool resources... unfortunately, this is not really the case in France where the linkages between public and private remain weak and fragile. This is something we are keen to work on and correct," resolves B.Braun's managing director, Marc- Alexander Burmeister.

Bertrand and Thierry Letartre - president & CEO, Laboratoires Anios

As one of the few non-French CEOs based in France, Burmeister has a unique perspective on this issue. Despite the sometimes problematic relationship between the state and private companies, B. Braun chose to scale up their operations in France due to the fact that "France provides a good nucleus for start-up companies and SMEs, and B. Braun has grown through the acquisition of these same SMEs." He also highlights that France's "production knowhow and capabilities are crucial to our success in producing in bulk at lower costs" and that the company's "strong positioning and production base in France enables us to closely collaborate with researchers, the local community and university centers."

Jean-François Mouney - CEO & chairman, Genfit

RETHINKING HEALTH PROVISION

One concept rapidly gaining traction within the French medical community is the idea of 'home care'. "There are radical shifts afoot right now that look very likely to thoroughly reconfigure the way that future generations conceptualize healthcare," reveals Carlos Jaime, general manager of the Health & Medical Equipment Division of Samsung. "90 percent of French senior citizens wish to spend the final years of their life in their own homes, rather than in hospitals or rehabilitation centers and when you juxtapose this fact with the realities of rising demand for care and a constricted budget allocation, it's clear that we are going to be seeing continued decreases in the number of hospital beds and the time each patient spends in hospitalization," he continues. "Conversely, this should create new opportunities for mobile business with the m-health solution market anticipated to be a EUR 7 billion industry in Europe (USD 7.8 billion), by 2018," he forecasts.

Frederic Duchesne - president & CEO Pharmaceuticals Division, Pierre Fabre

Already numerous entities active in the French market appear intent on making such predictions a reality. "One of our foremost priorities in recent months has been to develop the homecare side of our business in line with what we identify as a fast emerging trend," announces Olivier Samama, CEO of Biotest, a company dedicated to fractionation and provision of plasma derived products. "Our sub-Q treatment of Zutectra, our flagship hyper immunoglobulin product used for liver transplant patients, goes a long way to increasing the quality of life of our patients, since each individual is now able to treat themselves in the comfort of their own home.

Located at the Toulouse Oncopole Campus, the Pierre Fabre Research and Development Institute houses an outstanding oncological research center. Credit: Laboratoires Pierre Fabre

'Home care' has equally become a core part of ResMed's offering and indeed played a part in enabling the business to transition itself from a conventional hardware provider into a self-styled 'connected-care company'. "Thanks to software innovations like Automatic Positive Airway Pressure, our treatment has become personalized to each patient condition, following different patient needs throughout the night. Thanks to this innovation the majority of our patients are fully managed at home, from their diagnosis to their treatment titration and follow-up," confirms Lucile Blaise.

ADVENT OF BIG DATA

As with many other advanced pharma markets, digital disruption has arrived in France and is increasingly reshaping the local healthcare landscape. What is particularly interesting in the French instance, however, has been the willingness of many actors to embrace and hasten these forces of change. "France has established itself at the vanguard in pioneering big data in healthcare: the regulatory environment surrounding data hosting services is already well matured and provides a clear framework to operate in-so much so that the EU legislation to be implemented in 2018 actually follows the French example," exclaims Elie Lobel, CEO of Orange Healthcare which provides the tools necessary to capture data from medical devices, manage it, transfer it, and host it in a secure manner. Orange itself is notable for becoming the first telecommunications company to be awarded accreditation to host health data on the local market under the aforementioned framework.

The consultancy, Roland Berger, for its part, has been building up its capabilities to assist traditional pharma firms handle the encroachment onto their turf of pure digital players: the so called GAFAs (an acronym standing for tech giants: Google, Apple, Facebook and Amazon). "I predict that technology companies will not merely be healthcare actors of the future, but the real winners! We're talking about entities that can leverage their technological agility to accumulate, aggregate and interpret a tremendous amount of information. These companies have technical expertise, notably in data management that many pharmaceutical companies do not... Most importantly, looking at E-Health through the eyes of a patient (and not a specific drug) they are capable to aggregate information across several treatments for a same patients through 'universal platforms,' when a pharmaceutical company will be by nature focused on a treatment or a specific condition," analyses senior partner, Patrick Biecheler.

LYON: PRIDE OF THE PACK

It would be wrong to think, however, that creativity and the pioneering spirit is only the preserve of the Parisian metropolis. Considered one of the real jewels in the crown of French pharma, Lyon manages to hold its own as one of the world's leading vaccine production centres and houses an industrial biology and life sciences sector that today accounts for some 600 firms and 60,000 jobs. Moreover its dense network of scientific, clinical and industrial residents includes numerous iconic brands ranging from Sanofi-Pasteur to Merial and bioMerieux.

For a start, the city boasts an illustrious heritage and lengthy tradition in pharma circles. "Lyon can genuinely claim to be the birthplace of the bio-industry," discloses David Kimelfeld, vice-president in charge of Economic Affairs at Métropole de Lyon. "The Merieux family essentially kick-started the life sciences industry in Lyon by harnessing waste materials from animals to process the first bio serums. Biotechnology has thus been in our core makeup from the very start," he proclaims.

Nor has the momentum ebbed subsequently. Over the last couple of decades, there have been some very concrete efforts on the part of both the administration and private sector to ensure continuity of the region's status as a thought leader, hub of excellence and spur to innovation. The creation of the Biodistrict Lyon-Gerland, for example, sought to organize and maximize local expertise in infectious disease through the banding together of world-class private and public institutions in the South of Lyon. A related project involved the establishment in 2005 of the much acclaimed cluster Lyonbiopole: an endeavour that has since spawned some 169 collaborative R&D projects and total investment to the tune of some €777 million (USD 866 million). With additional high-impact initiatives on the horizon – notably the opening in 2017 of the Bioaster Tehnology Research Institute (TRI) forecast to provide over 1,000 new research jobs in infectious disease and microbiology – it is little wonder that private enterprise are continuing to ramp up their local footprints. Sanofi Pasteur, for instance, recently announced additional investment of some €300 million (USD 334 million) ring-fenced for the construction of an additional vaccines facility.

Many stakeholders claim that what differentiates Lyon from other such hubs round the world such as Boston or Raleigh is the intense spirit of collaboration imbued in the projects and the positive impetus exhibited. "Lyon's life science industry has not been affected by any particular political colour and contrasts with the multiple kingdoms approach encountered in places like Paris where there is no real commonly shared agenda," remarks Philippe Archinard, president of Lyonbiopôle. "This has allowed the cluster to evolve from an originally narrow scope to one that embraces all life sciences, with an agenda that includes fostering public-private partnerships to help finance companies or help them find partners to enter international markets," he reasons. Indeed "the defining features of our competitiveness clusters are our collaborative model, shared objectives and ability to bring together larger companies, SMEs and a broad base of stakeholders," agrees Bruno Masurel, head of the international division of the Lyon Chamber of Commerce (CCI Lyon).

Lyon's geographical and strategic positioning also counts very much in its favour. "This city is at the crossroads of Northern and Southern Europe, with well-organized connections to every country on the continent within two hours. Its size, which is more or less comparable to Frankfurt or Barcelona, also affords the city sufficient strength to attain critical mass while its 130,000 strong student base is another plus factor, not to mention the fact that Rhône-Alpes ranks the 6th largest economic region in Europe," attests Jean-Charles Foddis, executive director of the Lyon Area Economic Development Agency (ADERLY).

LILLE WONDER

Less-well known internationally than Paris, Lyon and even Alsace, but with a reputation for high-performance family-owned industrial firms, Lille is also steadily carving out a niche for itself within France's healthcare and life science industries. The city is the home of global supermarket chain Auchan and sportswear behemoth Decathlon, but is also where Louis Pasteur began his groundbreaking studies on fermentation in 1854.

This healthcare legacy is continued by family-owned Anios, which produces disinfectants and disinfectant devices for the healthcare industry and recently celebrated its 118th anniversary. CEO Bertrand Letartre, great-grandson of the company's founder, explains that Anios' mission is to combat nosocomial Hospital-Acquired Infections (HAI). He sees these infections as "a 'killer by stealth' that is not widely discussed; more people die from these infections in France than are killed on the road each year." As the company moves beyond only producing soaps and gels towards also producing high-end technical products such as endoscopes, Letartre affirms that Anios is trying "to sell security for the personnel and for the patients. Therefore, we have to provide a system of liquid and equipment which is efficient and has the smallest amount of toxicity and corrosiveness possible."

Emerging biotech player Genfit is also based in Lille and has raced to "EUR 100 million (USD 112 million) in revenue in its first seven years alone" according to CEO and chairman Jean-François Mouney. Genfit's Elafibranor drug treats nonalcoholic steatohepatitis (NASH) and Mouney feels that its potential is "worldwide. The strategy for Genfit is to control the development of the drug. Even if we have an alliance with other pharma companies we want to co-develop the drug." This striving for international reach while retaining local values is echoed by Anios's Letartre, who wants to "increase the percentage of our turnover coming from outside of France from 40 to 50 percent" while ensuring that they choose "partners and subsidiaries that have the same culture and philosophy as us." These two Lille companies are expanding rapidly abroad while remembering their roots.