French Drug Industry Faces Delicate Tax Talks

SNIP, the French drug industry association, is to negotiate over thedetailed application of two taxes envisaged in Labor Minister Martine Aubry's social security plan.

However, SNIP president Bernard Mesure has made clear that after making its "exceptional contribution" of 2.5 billion French francs ($421 million) last year (Marketletters passim) - to help balance the health budget - the pharmaceutical industry "is not a sector from which the state can regularly squeeze a little money whenever it needs it."

The Aubry draft legislation on financing the social security system is expected to generate 600 million francs in 1998, but Mr Mesure has said the amounts are certainly not being discussed at the moment. The SNIP is arguing that the proposed taxes on advertising and promotion do not take sufficient account of the detailed requirements of the drug companies in their launching of products or defending market share.