Why it's boom time in Pharmachem City

The growing cluster of plants is a boost to jobs but still worries environmentalists, writes Barry Roche, Southern Correspondent

At the height of the hysteria over Viagra, a story broke that Madonna was in negotiations for the rights to make a film called Something in the Air. It was to be set in a small village – based on Ringaskiddy in Co Cork – where people who live beside a Pfizer plant in which the drug is made become highly libidinous after inhaling fumes.

Whether the film ever gets made and whether Ringaskiddy ever gets on to
the silver screen isn't certain – latest reports suggested it would be shot in
California. What is certain, however, is that the former fishing village, along
with Little Island on the other side of Cork Harbour, has already put Cork on the map internationally by becoming home to some of the world's major pharmachem companies. Pharmachem City may not have quite the same established ring to it as Silicon Valley, but there's no denying the importance of the pharmachem sector to Cork with an estimated 5,000 people working in more than 25 pharmachem companies in the area and a further 10,000 jobs dependent on the sector through the provision of goods and services.
While precise figures for the value of the sector to the Cork economy are difficult to obtain, the entire pharmachem sector is the largest contributor of corporation tax in Ireland (€700 million in 2001) with exports in 2002 totalling €39 billion. The Cork plants are believed to
account for more than half of Ireland's pharmachem manufacturing and
exporting.
Pfizer, the world's biggest pharmachem company, was the first to come to
Ringaskiddy in 1969 – and where Pfizer went, others followed. GlaxoSmith-
Kline (GSK), the world's second-largest pharmachem, came in 1975, while two others in the top 10, Johnson & Johnson and Novartis, also have significant operations in Ringaskiddy.
Pull back the focus a little to include the greater Cork area and Eli Lilly with
its operation in Dunderrow, near Kinsale, and Schering Plough with its plant
at Brinny, near Innishannon, further highlight the importance of the pharmachem industry to Cork – a value underscored by its cumulative capital investment of €40 billion.
And there was further good news for Leeside last month when, just hours
after GSK opened its  €34 million research and development (R&D) facility at its plant at Currabinny near Ringaskiddy, Tánaiste Mary Harney announced that Johnson&Johnson subsidiary Centocor is to invest $650 million in setting up a 330-job plant in Ringaskiddy.
The Centocor development is particularly significant as it's a world leader in biopharmaceuticals where naturallyoccurring biological processes are used to attain new and beneficial therapies for a wide range of illnesses including
cancer, infectious diseases and heart disease, as well as arthritis and inflammatory skin diseases. And the good news for Cork is that the global biopharmaceutical sector is growing by 15 per cent a year.
IDA Ireland south west manager Conor Healy says that Centocor exemplifies the success of the State agency in getting leading pharmachems into Cork. The key requirement is a skilled workforce – some 60 per cent of Centocor staff will have degrees – and he points to the importance of both UCC and Cork Institute of Technology in producing a skilled pool of graduates and postgraduates. Infrastructure is also crucial and the IDA has invested heavily in building up a series of wellserviced sites in Ringaskiddy, Little Island and Carrigtwohill, which are all equipped with utilities such as water, electricity and gas to allow Ireland to compete internationally for the
projects. Ireland's 12.5 per cent rate of corporation tax is also an aid to attracting firms, he adds.
But how has  the pharmachem industry taken to the locals – and, more
importantly, how have the locals on Leeside taken to the industry? Although,
historically, companies such as Pfizer were always traditionally regarded as
good employers during the bleak days of recession in the 1980s, the sector won few plaudits from environmentalists.
Smokestacks spewing out fumes over Cork Harbour hardly helped the sector's image and the low point was reached in August 1993 when an explosion and fire at Hickson in Ringaskiddy (since taken over by Warner Lambert and now part of the Pfizer operation) – led to 100,000 gallons of contaminated water leaching into Cork Harbour.
Derry Chambers, a member of the now defunct Cork Environmental Alliance – which went all the way to the Supreme Court to oppose planning permission for Sandoz (now Novartis) – remains distrustful of the sector. He has little faith in the Environmental Protection Agency (EPA) and he reckons that "when it comes to a toss-up between industry and the environment, industry will always win". He points to the case of Indaver Ireland getting approval from An Bord Pleanála for its proposed incinerator at the tip of the Ringaskiddy peninsula, despite the board's own inspector recommending against it and Cork County Council also voting against the proposal.
"It's a war of attrition and industry has the resources to fight it out – they
win because they have so many resources," he says glumly.
When The Irish Times put Chambers's criticisms to the EPA, it declined
to comment.
Cork South Central Green Party TD Dan Boyle reckons the pharmachem
sector has improved in recent years thanks to advances in technology, though he too has reservations about the EPA. He welcomes the moves into
cleaner R&D but is concerned about the safety implications of such a concentration of industry in Ringaskiddy.
"If there was to be an accident at one plant, my concern is that it could
spread to another plant given their proximity– I'd be more concerned on that level now than in terms of ongoing pollutants.
Certainly, safety is a big concern for a lot of the people working in the plants who raised the issues with us on the election canvass," he says.
Conor Healy of IDA Ireland points out the pharmaceutical sector is "probably the most regulated sector in the world . . . Most of them – thanks to their own high internal standards – surpass the legal standards required of them by the EPA and they are all good corporate citizens in terms of employeremployee relations, the environment and their relations with the community," he says.
The chairman of Ringaskiddy and District Residents' Association, Braham Brennan, says relations with the pharmachem industry have improved hugely since the Hickson fire, though residents remain strongly opposed to the planned incinerator at Ringaskiddy.
"Relations now are good, certainly compared to 10 years ago, everyone has
cleaned up their act – they had to – and there's been a big improvement in the air quality," says Brennan. If he has a gripe with the sector, it is that it doesn't seem to employ any Ringaskiddy people, but most employees come from Carrigaline, Cork city or farther afield.
Cork Chamberof  Commerce president Robin O'Sullivan – whose company
O'Sullivan PR represents many of the firms – is in no doubt but that they have been a major plus for Cork. "The pharmaceutical sector is hugely important to Cork – they provide jobs, taxes and exports, they have expanded rather than contracted and they have a remarkable record of reinvestment in the area."
An example of firms fostering community relations can be found in Little Island, where Cognis Ireland sponsors the local GAA club, Erin's Own (for whom Cork hurler Brian Corcoran plays). Janssen Pharmaceuticals runs
projects in Glanmire Community College and supports Glounthaune scout
troop.
And still they keep coming. Last year, German pharmachem company, Altana announced it was investing  €70 million in a plant at the IDA industrial estate in Carrigtwohill that will create 150 new jobs by 2006. The Italian firm, Recordati, is investing  €28 million in a manufacturing
plant and an R&D facility in Ringaskiddy that will create 60 jobs at full production.
Although Schering Plough laid off 170 staff earlier this year, the pharmachem
sector is generally considered more stable than electronics, though Conor Healy cautions against any complacency.
Ireland needs to maintain its competitiveness in terms of costs and needs to invest continually in both education and infrastructure if it is to continue to attract further investment, he says.
Healy points to investment in R&D as the way to go. Initially, the pharmachems came simply to produce active pharmaceutical ingredients but gradually they have started to locate higher value activities in the area – R&D in the case of GSK, supply chain management in the case of Novartis and process development improvements in the case of Pfizer.
"Traditionally, the US has been the key location for R&D in the pharma sector given that many of the major pharma companies are of US origin –
we need to concentrate on getting to the same level in terms of R&D that we
have in manufacturing, but the move to R&D and value-added activities can't happen overnight – it's a transitional thing. Look at GSK – they're here since 1975.
"R&D is crucial for the companies. They need to develop new blockbuster
drugs because typically their products have a 10-year patent lifespan. The
most appropriate way to get in an R&D facility is to build on the success of a manufacturing facility in terms of building up confidence in the skills, environment and support services."
Healy points to the accumulation of knowledge in the sector in Cork over
the past 20 years as another factor in attracting future industry. The area has
a wealth of experience in terms of consulting and engineering services, construction firms who can build plants, recruitment specialists and other
service providers.
The clustering of pharma companies
in Cork is also important. "There's a comfort factor in knowing that other companies have run successful operations out of Cork – that level of comfort has built up over a good number of years. They also look at Cork and can see that it's a positive location in terms of lifestyle with a lot to offer."