Skills key to growth of biotech industry

Wyeth is one of only a handful of companies conducting high-level biotechnology research and development in the Republic, writes Jamie Smyth, Technology Reporter

There is no shortage of white coats, pipettes or sophisticated technology equipment at the $1.5 billion Wyeth BioPharma Campus in south-west Dublin.

The 110,000 sq m facility already has 850 full-time staff on board, many of whom are working on the complex biotechnology processes required to develop drugs to combat arthritis and pneumonia.

Wyeth plans to take on hundreds more staff before its Grange Castle plant - billed as the world's largest integrated biotechnology campuses - goes into full production next year.

Wyeth is just one of a score of pharmaceutical firms in the Republic which are generating billions in corporation tax for the Government and tens of thousands of jobs. But, significantly, it is one of only a handful of companies conducting high-level biotechnology research and development in the Republic.

"We have 80 world-class scientists in our development operations facility," says Mr Brendan Hughes, Wyeth's development director. "We are answering one of the key challenges for IDA Ireland - to get big manufacturing operations to co-locate their development operations here."

Biotechnology is the alteration of molecules, genes and cells - the basic building blocks of life - to develop useful products, processes or services such as new medications and therapies, cloning, genetically modified foods and enhanced crops. It is increasingly becoming a force in drug research, which previously focused primarily on chemical synthesis to formulate treatments.

Last year, the US Food and Drug Administration (FDA) approved 24 biotechnology drugs, compared to 28 in the previous 15 years. It is estimated a further 625 biotech drugs are in clinical trials, IDA statistics show.

Wyeth's team of 1,300 scientists in the US has developed a range of biotechnology processes to create new cell cultures and proteins that can address a range of diseases. Now, the firm's development operations facility at Grange Castle is working on perfecting the process to develop the drug Enbrel, which helps patients with forms of arthritis.

"We are making changes to the way we grow the cells by changing the temperature, nutrition or agitating the cells," says Mr Hughes, who is confident that the Irish team will eventually create a new process that can be used by other Wyeth manufacturing facilities worldwide.

This type of R&D activity is a key component of biotechnology investments, says Mr Enda Connolly, manager of education skills and research at IDA Ireland.

"The processes are really part of the product in the biotechnology world. So firms need to do a lot of research into the processes and the technology they use to create drugs," he says.

The IDA believes there are at least 5,000 highly skilled jobs that can be created in the biotechnology sector. It is targeting the pharmaceutical firms already based in Ireland, many of whom are currently considering global biotechnology investments.

Is is highlighting the State's strong base in related sectors, such as chemicals and medical devices, to help lure investors.

"Wyeth is typical of big biotechnology investments, so we could see other similar size projects coming here," says Mr Connolly, who nevertheless acknowledges it will be a challenge to attract major projects.

Low rates of corporation tax have driven much of the pharmaceutical investment in the 1990s but biotechnology investment will require far higher skill levels that do not exist yet in Ireland.

Forfas's recent report, Supply and Demand for Skills in the Biotechnology Industry, identified a serious future skills deficit for the period 2003-09. It predicts that at least 180 new PhD and MSc level scientists and a further 600 workers with specific biotechnology skills are needed to maintain the industry.

Despite hosting the first biotech campus in the Republic, Wyeth had to look abroad for the skills needed to make its campus a success. About 12 per cent of its employees were headhunted from abroad - half of these Irish people returning home.

Dr Maurice Treacy, director of Science Foundation Ireland's biotechnology division, acknowledges the skills challenge facing the Irish development agencies. "At least we are aware of that challenge... the Science Foundation Ireland programmes are funding people and ideas to create a critical mass of researchers," he says. "The timeframes must be realistic though. It will take a few years to get the people into place and create the intellectual property."

The goal of Science Foundation Ireland, which was set up as a statutory agency in mid-2003, is to fund cutting-edge research in the Government's priority areas of biotechnology and technology.

It is currently funding 80 biotechnology projects, involving about 400 researchers at third-level colleges. It is also seeking to establish links between the academic and corporate sectors in an attempt to build skills among researchers and create opportunities for entrepreneurial spin-offs.

"We can be competitive in certain niche areas even on an international stage," says Mr Treacy, who highlights neurological research at UCD and research on regenerative medicine at NUI Galway as potentially groundbreaking projects.

The UCD project will bring together a cluster of scientists from UCD, TCD and Wyeth's US R&D operation to investigate how doctors can better treat illnesses that affect the brain, such as Alzheimers.

One of the big benefits of the project - which is being part-funded from a €7.7 million grant from the SFI - is that it will create a cluster of knowledge, says Prof Ciaran O'Regan, who is leading the UCD research group. Of particular benefit to the Irish academic researchers will be the strong focus on project management that a corporation such as Wyeth will bring to their research, says Mr Regan, who has worked in the past with the British firm, GlaxoSmithKline.

These sentiments are shared by Dr Mene Pangalos, head of the Wyeth Neuroscience Discovery Group, which is based in the prestigious US university, Princeton.

"In this area of research, everyone has limited resources and the collaboration with UCD will enable us to do more early stage research," he says. "Irish scientists will travel to the US and learn more about the drug discovery processes that we use at Wyeth. This should help them learn more about what it takes to develop a drug from discovery."

Wyeth, UCD and TCD have also signed agreements to govern how they can exploit the commercial opportunities that will emerge from the basic research.

"What is great about this type of collaboration is that it should encourage start-ups and investment in biotechnology in the future," says Mr Pangalos. "It will also build fundamental commercial skills among Irish scientists."

The IDA estimates there are about 15 indigenous biotechnology firms and it hopes that when the SFI projects become more established new firms will spin off from the universities.

This would establish a cluster of skills and make the Republic more attractive for outside investment from multinationals. But the recent failure of the Government to land a $100 million biotechnology investment from General Electric illustrates the challenges Ireland faces to succeed.

General Electric and the Government were in talks for several months about setting up a global centre for medical imaging technology at DCU. However, these talks collapsed recently, in part because of the huge expense of the proposed biotech project.

"Ultimately we couldn't create a win/win situation for both the Government and General Electric," says the IDA's Mr Connolly.

Clearly, the sums required to set up and fund biotechnology projects could prove a further challenge for Ireland, which has a limited research budget when compared to the US and other world leaders in biotechnology.

Low corporation tax will not prove as important a factor in attracting biotechnology investment as it hasfor the traditional pharmaceutical industry. Skills are likely to prove a much more important factor for the future.

Establishing links between academia and industry should help address the skills issue and recent moves to "incentivise" research and development by offering tax breaks is welcome.

Experts agree the next six years will be critical if the Government's and SFI's vision of generating a viable biotechnology industry is to be a success. By that stage the IDA hopes Wyeth's $1.5 billion investment will be one of several multibillion projects.

But success is far from guaranteed as Ireland will face stiff competition from the US, Singapore and a number of European States.