Conditions for the Development of the Biotechnology Industry in Germany Position Paper by the Working Group on Finance and Taxation


Biotechnology is one of the most important key technologies and promoters of innovation for this century and is one of the sectors that form the basis for a sustainable economic upturn. With growth rates of 15 – 20 percent worldwide, it is one of the largest growth engines for both the labour and the capital market. Innovative biotech agents already account for 27 percent of worldwide medication research and 10 percent of the worldwide medication turnover.

The state offers a wide range of research funding. However, organisational streamlining and bureaucratic simplification would be welcome. ERP umbrella funds and high-tech start-up funds provide a positive approach. However, because of the necessary volumes, public funding can only cover the basic research, early start-up phase and, in some cases, individual projects.

In order to strengthen the sector in the long term, a capital flow that goes beyond setting up companies must be made easier. The market can gain strength from the inside out by targeted relief for companies and investors. Subsidies could thus increasingly fade into the background. It is important that the particular needs of this new sector be taken into account. Competitive disadvantages within Europe must be abolished so that the biotechnology sector in Germany can survive and flourish. Therefore, the main aim must be to support the willingness to invest and to take risks on the part of financially strong investors from Germany and abroad, as well as innovative companies, by improving conditions in the following areas:

  • Improvement of conditions for the capital market
  • Improvement of taxation and corporate law conditions

Above all, the focus must be on the targeted elimination of weaknesses in the financeability of biotechnology. Corporate risk-taking should be encouraged rather than penalised. This applies to both small and medium-sized enterprises and to public companies, insofar as the companies are subject to a need for subsequent funding because of the development costs of future, innovative products, without which they face a threat to their survival. All parties who face this business risk in this key industry, that is, investors, companies and staff, should sense this support in Germany.

For this reason, we demand that the following initial measures be implemented with immediate effect:

  • The possibility to offset losses resulting from investments in fiscally transparent partnership funds or direct investment in research-intensive biotechnology companies. An appendix or a clarification of § 15 b EStG would be necessary as this law cannot be applied to the aforementioned funds or to investments in innovative companies.
  • Special amortisation or other tax benefits for the purchase of shares in innovative companies, including listed companies, similar to the British AIM.
  • Relief in the exclusion of subscription rights for listed companies (limit of 20%).

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