Life sciences continues to shine

Despite global headwinds affecting all industries, Ireland’s enviable life sciences sector largely continued to flourish in 2023, with Ireland remaining an attractive destination for pharmaceutical and medtech companies wishing to establish a base here or expand.

According to Aidan Meagher, head of life sciences at EY, Ireland’s strong value proposition for the life sciences industry remains unchanged, with a highly educated workforce (Ireland has the highest level of Stem graduates per capita in the EU among 20-29 year olds), strong pool of talent, access to the wider European market, and of course our “modest and stable” corporation tax regime.

Furthermore, our already significant footprint in the life sciences sector serves to make us highly attractive, he says. “Ten of the top 15 biopharma companies, nine of the top 10 medical device companies and the fourth largest incubator of medical device start-ups are all already located in Ireland. We also have a strong track record with no US FDA regulatory issues in terms of Irish manufactured products, which would provide confidence to any life sciences firms considering locating here.”

The last five years has seen the biopharma sector experience tremendous growth, says Sinead Keogh, director of Biopharmachem Ireland (BPCI), Ibec. “Ireland is already recognised as a global life sciences hub, with 85 companies directly and indirectly employing 80,000 people to deliver €106 billion in exports.” She notes that the Government’s recent decision to sign up to the OECD global tax reforms now offers “essential” long-term predictability that the minimum corporate taxation rate will not be increased above 15 per cent. “The increase in the R&D tax credit in Budget 2024 to 30 per cent has also been welcomed and will ensure that large multinationals retain the benefits of the credit as we moved to a new global minimum.”

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Indeed, several major investments were made by pharmaceutical companies in 2023. Eli Lilly and Company announced plans to invest more than €400 million in a new manufacturing facility in Limerick in January, while in February, AstraZeneca lodged plans for a €337 million “next generation” active pharma ingredient-manufacturing facility in north Co Dublin. In September, AbbVie established a new €23 million European manufacturing services hub in north Dublin and healthcare company, MSD Ireland, announced the opening of a new, state-of-the-art site in Meath in addition to a significant expansion at its Carlow site. There were also reports in September of Japanese pharma company Astellas’ plans to invest €330 million in a new facility in Tralee, creating 350 jobs.

As the sector continues to invest and expand its operations in Ireland, the demand for the right kind of talent becomes “acute”, Keogh says. “The availability of skills and talent is seen by the industry as a key prerequisite for future competitiveness, investment, and employment.” Ibec is currently supporting the work of the Government’s Expert Group on Future Skills Needs (EGFSN), with the job of preparing a report on the current and future skills needs required for the sector to underpin future success.

Ireland has developed clusters of expertise in specific industries, with this cluster effect proving particularly beneficial for life sciences firms, notes Aoife O’Sullivan, head of network development and innovation at Skillnet Ireland. “Clusters facilitate collaboration, knowledge sharing, and the development of a supportive ecosystem.”

Skillnet Ireland has a cluster of Skillnet Business Networks working together in the life sciences sector, including Irish Medtech Skillnet, BioPharmaChem Skillnet, and Connected Health Skillnet. “These Skillnets actively work with industry to create upskilling programmes responsive to business needs, which is essential for an agile, diverse, and skilled workforce,” explains O’Sullivan. “Focussing on talent development, they provide impactful training programmes to both SMEs and multinationals, addressing the evolving skills needs and long-term talent challenges of the sector.” Last year alone, the three Skillnet Business Networks in the life sciences sector worked with almost 600 companies and supported about 5,000 employees.

O’Sullivan adds that visible investment in specific industry-led talent development illustrates Ireland’s commitment to developing a highly skilled workforce and fostering innovation, particularly in the life sciences and digital health sectors. “The BioPharmaChem Skillnet and UCC’s micro-credential programme `An Introduction to BioPharmaceuticals and Advanced Personalised Therapies’ is a good example of industry-academic partnership,” she notes. This programme helps participants develop their skills in areas like biopharmaceuticals, advanced personalised therapies, and cell and gene therapies. The Virtual Reality (VR) training programme developed for the pharmaceutical industry in partnership with Technological University (TU) Dublin and the BioPharmaSkillnet, also demonstrates that strong collaborative link.

O’Sullivan says Ireland must continue to foster skills in software development, manufacturing and data analytics, as well as promoting a culture of innovation and strategic thinking. She also points out that Ireland has a golden opportunity to establish itself as a global hub and centre of excellence for the burgeoning digital health sector which is projected to be worth more than $1.5 trillion by 2030. “Investment in digital health technologies and upskilling in areas like product design, user experience, and artificial intelligence will be crucial, this is where the Skillnet Business Networks play an important role in supporting companies with their talent development agenda,” she says.

For Ireland’s reputation as a global hub for life sciences to continue, Meagher says there is a need to provide an integrated end-to-end value chain from research and development, to manufacturing, commercial and finance. “The solution lies in greater collaboration between industry, academia and the technology sector, harnessing the power of data, which acts as real world evidence, digital and AI, and new financial incentives underpinning true value-based healthcare.” However, he cautioned that adequate affordable housing, education and healthcare remain key challenges in terms of Ireland’s attractiveness for new investment.

In order to sustain its hard-won competitiveness, Ireland needs to bring key stakeholders together across government, industry and beyond to ensure the right policies are in place, Keogh adds. “To keep pace with the international business trends and the increasing complexity of the health innovation ecosystem we need to adapt and evolve. The development of a national industrial life sciences and health technology strategy will enable the adoption of industrial policies that promote clustering so that Ireland can realise more strategic cross-sectoral co-operation.”