LONDON – The president of France's biotechnology industry association said Thursday that he aims to make France the European leader in biotechnology by pushing tax incentives through the French government.

Speaking at a Red Herring conference, Philippe Pouletty of France Biotech addressed the misconception that setting up in Europe means profits are siphoned off by high taxes. He cited France's 26 percent capital gains tax; Silicon Valley and San Diego biotechs face 20 percent federal and 10 percent state taxes.

Mr. Pouletty has ambitions to make France the star of European biotech. However, he may have some way to go. Just two biotech companies—Alchimer and Diatos—were among the 10 French companies in the Red Herring's top 100 technology companies in Europe. The list is posted in the current issue of Red Herring (see: Subscription Information).

The French biotech boss did, however, criticize the ability of European states to market themselves globally, as well as the lack of visibility given to public companies by Europe's fragmented stock markets.

"It's like taking a company public on the Texas Stock Exchange. You just wouldn't want to do it," said Mr. Pouletty.

Another problem is that European institutional investors are less likely to invest in high tech. U.S. pension funds invest between 4 and 12 percent of their cash in private equity compared to 3 to 5 percent of British pension funds, which are some of Europe's most aggressive.

France Biotech has so far managed to pull the right strings to get French insurers to pledge 7 billion euros ($9 billion) in investments in young companies by 2007.