Life Sciences Clusters in Europe

in Industry insights, Tax, 21.10.2013

What makes a European Life Science site attractive to foreign investors? KPMG Switzerland’s Global Location Evaluation Services collaborated with Venture Valuation, a business intelligence boutique specializing in Life Sciences (LS), to analyze previously unpublished data comparing leading European LS clusters.

For Life Sciences companies (Pharmaceutical, Biotechnology and Medical Devices) it has never been easy selecting a location in Europe for Headquarters, shared services centers, manufacturing or R+D operations. A variety of factors must be taken into consideration.

Taking a look at a broad spectrum of these factors, we analyzed Venture Valuation’s previously unpublished data to compare leading European LS clusters in France, Germany, Ireland, the Netherlands, Switzerland and the UK. Some of our findings include:

  • France has a solid LS industry focusing on nutraceutical and cosmetics
  • Germany has the highest number of LS companies of any European country with focus on Medical Devices
  • Ireland is an attractive location for manufacturing to domestic and foreign LS companies
  • The Netherlands have a diverse LS industry with particular strength in Medical Devices and Biotechnology
  • Switzerland has the highest LS workforce relative to the active population
  • United Kingdom has Europe’s largest cluster in Biotechnology therapeutics and Pharmaceuticals

However, neither size nor specialization of a Life Sciences cluster alone is a decisive factor when it comes to selecting a location for HQs, R+D or manufacturing operations by LS companies from overseas. Of equal importance are tax related considerations as well as the availability of qualified labor force and other business relevant factors.

While the two heavy weights in the Life Sciences Industry, UK and Germany may have the largest numbers of Life Sciences companies, they attract comparatively few regional HQs of foreign LS companies. Rather, countries such as Ireland and the Netherlands are more successful in attracting Foreign Direct Investments (FDI) due to lower costs and/or more beneficial business and tax conditions. Both Switzerland and France are attractive to FDI’s from the Life Sciences sector for different reasons: France offers generous R+D incentives while Switzerland offers one of the world’s most competitive business environments paired with a top research environment and the presence of a world class Life Science Industry.

You can take a look at these findings in KPMG’s report Site Selection for Life Sciences Companies: Cluster Report 2013. You will find it is a useful reference on Europe’s top Life Sciences clusters and their attractiveness to foreign investors. The report will assist Life Sciences executives from the US, India, Asia and other fast growing Life Science centers, equipping them with the necessary information to start, expand or restructure their activities in Europe.