It is far from hyperbole to say that Ireland is a global leader in life sciences. The numbers speak for themselves – the sector employs more than 84,000 people in more than 700 companies, nine of the world’s top 10 medtech companies have bases here and all of the world’s top 10 biopharma companies are here. Generating exports worth in excess of €123 billion annually, it’s Ireland’s life-sciences sector punches well above its weight internationally.
While maintaining this enviable record is an ongoing challenge in a highly competitive global market, Ireland’s offering remains as attractive as ever for multinationals in this flourishing sector, the State having carefully cultivated a unique and supportive environment that allows the sector to thrive.
Ireland has a strong reputation as a major player and a global hub for the life-sciences sector, says Elaine Daly, global head of business consulting at Grant Thornton Ireland.
“As the world’s third largest net exporter of pharmaceuticals, Ireland has an established reputation as a global powerhouse for the industry.”
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Daly attributes this ongoing success to a number of distinct factors, including favourable government policies, trading environment and international reputation and, crucially, our highly competitive and skilled workforce. “A key global competitive advantage for the sector is Ireland’s strong talent pipeline of a highly educated and English-speaking workforce. The Irish higher education system continues to produce a high volume of skilled graduates in areas essential to the sector and this has been further compounded by the formation of close links with the industry,” she says.
Government policy has been instrumental in not only attracting foreign direct investment from life-sciences behemoths, but encouraging growth and expansion of their activity here over the years. Daly cites the research and development tax credit as pivotal in this, as well as, of course, our historically low rate of corporation tax. “Despite an increased and standardised rate across the EU, Ireland’s competitiveness remains and continues to attract foreign direct investment in the life-sciences sector.”
In addition, our membership of the European Union allows unfettered access to the European single market, an optimal exporting position that facilitates medicinal product exports from Irish manufacturing sites to the European and global markets. “This ideal trading environment is paired with an exceptional international regulatory reputation. The Health Product Regulatory Agency, the medicines regulatory agency in Ireland, is renowned and well respected across the globe,” Daly says.
“Ireland has an open and innovative economy, with a supportive government investing in the development of FDI and competitive tax policies, allied to people and service providers with many years’ experience in the industry,” agrees Colin Kavanagh, partner and head of life sciences at Arthur Cox. “These factors, along with the work done by the IDA and others, ensure that Ireland is one of a small number of countries always considered for significant manufacturing developments and as a beachhead into Europe.”
There is no reason that this should not continue, and Kavanagh points out that successive governments have ensured stability in terms of our offering for multinationals seeking to invest here. “Biopharma and medtech companies considering locations for new or further investment need a stable platform of government supports, talent, industry regulation and infrastructure,” he says. “Ireland enjoys a well-regarded regulator, underpinned by the EU structures, and a stable suite of industry supports maintained by the Government.”
There are a couple of pressure points: research and development continues to be an area for development – Ireland has “well-documented issues in aspects of infrastructure”, according to Kavanagh. “Support for clinical trials and investigations is one area we need to invest more in.”
And though Ireland occupies an advantageous position when it comes to continued life-sciences investment, Daly points out that there are areas of consideration for further development by the sector in Ireland. “These include supply-chain and logistic considerations, novel therapeutics development and a greater focus on sustainability considerations.”
Kavanagh also highlights a new piece of legislation that he says could potentially have a negative impact on the life-sciences sector. “One area we do need to monitor closely is the proposed investment screening regime in Ireland as published in the Screening of Third Country Transactions Bill 2022,” he says. “The underlying purpose of the Bill – to manage the effect of transactions on sensitive sectors in Ireland – is fine, but we need to ensure that the legislation and its implementation does not impact on routine deals in the life-sciences sector.”
Gilead Sciences is just one major pharmaceutical company with a huge base in Ireland. According to David Cadogan, vice-president of manufacturing operations at the company the “excellent quality of resources and infrastructure in Ireland means it is no surprise to see it having become the global hub of excellence in life sciences that it is today”.
Cadogan adds that the global supply chain of Gilead products is highly dependent on its Irish operations. “Gilead’s Irish teams have assisted in the advancement of Gilead’s vision of a healthier world for all people and have played a critical role in ensuring that patients worldwide have access to Gilead’s innovative medicines,” he says.
Ireland is a “prime location” for biopharmaceutical production, Cadogan adds. “Ireland has a number of strengths – an experienced workforce, a strong research capability, sustainable infrastructure, business-friendly environment and ICT convergence for smart manufacturing.”
An indigenous Irish company, clinical research organisation Icon, has grown from a small team of five people in Dublin in 1990 and now operates in 53 countries worldwide with more than 41,000 employees.
“Against this backdrop, our Irish presence remains hugely important to us with regards to innovation and excellence, and our global innovation hub to advance clinical development was established here in 2015,” says Brendan Brennan, chief financial officer of Icon.
Ireland’s strengths as a location to do business are well known and remain hugely beneficial, Brennan says. “These include its stable, pro-business tax and regulatory environment, its proximity to key markets, language and its talented workforce – albeit we are currently operating in a very tight talent market.”
With regard to the latter point, building a diverse graduate pool of talented and ambitious Stem professionals who can help to ensure the future success of the life-sciences industry is hugely critical, Brennan says. “Collaboration between industry and academia will be hugely important to help build that talent pipeline and is the reason why, at Icon, we invest in partnerships with numerous Irish universities on leadership development and mentorship programmes, for example, in addition to Stem scholarship programmes.
“Further fostering and building these close ties between industry and academia will need to be enhanced and sustained.”