On the Trail of the Celtic Tiger

Last week [July 17-21], I was privileged to travel through Dublin and Cork (see map at right) to meet with some of the executives whose companies are driving Ireland’s growing life sciences industry and transforming it from a manufacturing center to an innovative knowledge base.

Currently, Ireland’s pharmaceutical sector employs 24,000 people directly and exports over $36 billion in products each year.

Until fairly recently, Ireland also exported its top IT and pharmaceutical talent.

Over the past 15 years, though, the tide of emigration has turned. As Ireland’s economy has become one of the richest in the E.U., the island is becoming a global, multicultural center, and grappling with such new issues as immigration, and the need to balance the pressures of globalization against the need to maintain its cultural identity.

There has been a resurgence of interest in the Irish language, and some schools now teach math and other courses in Gaelic. Their students now include children from China, Poland, Nigeria and the Philippines.

Although part of the EU, Ireland remains closer, culturally and business-wise, to Boston than to Berlin, as one Irish business weekly put it. Ireland’s become somewhat litigious, insiders say, and has rejected the social programs that some other EU nations offer. Like the U.S., it has also seen a decline in the number of students electing to study science and engineering.

Ireland’s pharmaceutical sector also faces cost pressures, including high salaries and high energy and environmental costs, while the nation’s transportation and telecommunications infrastructures are still catching up with recent growth. The CEO of one small pharmaceutical firm admitted that he plans to focus investments in the U.S., rather than locally, for the next few years.

However, the Irish government is responding to global challenges, and taking steps to secure the industry’s future. It has invested hundreds of millions of dollars over the past 10 years to develop the country’s manufacturing and research base, and is offering attractive investment options to experts who had left the country and wish to return.

For many pharmaceutical entrepreneurs, Elan Pharmaceuticals remains an inspiring model. Ireland’s first global-scale, home-grown success story, the company has had to restructure and still faces a number of challenges. Nevertheless, Elan continues to influence the industry through spinoffs, and its former executives direct the boards of numerous corporations.

Role models on the software side include two firms serving the global pharma industry: the PAT-related IT specialist Automsoft, and the compliance software expert Qumas. Both firms have a large U.S. presence, but they were actually established in Ireland and are officially based there. And the number of life-sciences-focused IT startups is growing.

Without exception, each company I met with, whether a drug manufacturer or an equipment or IT vendor, has embraced concepts that have yet to gain full acceptance in the industry, such as process analytical technologies (PAT), risk-based manufacturing, and open process control. Manufacturers are also using these concepts, on a practical level, to help drive down their own costs.

Ireland’s leading-edge technology, strong universities and a foothold in the EU continue to attract global investors. The week I was there, Pfizer, BMS and Genzyme all announced major R&D initiatives in Ireland. BMS’s project, involving university partners in Dublin and Galway, will focus on transformative technologies such as process analytics for biopharmaceutical manufacturing. The goal is to develop efficiency improvements that will reduce biopharmaceutical manufacturing costs, for a typical medium to large manufacturing line, by $50- to $80-million per year. The German firm Altana is building a new manufacturing plant there, while Wyeth Biopharma has poured over one billion dollars into biotech manufacturing.

As the industry continues to become more global in its outlook, it’s hard to know who the regional economic “winners” will be. Regardless of how the competition shakes out, Ireland promises to remain an important center for innovation in the future.

In future on-line articles and in our print edition, you can expect to read more about what your peers are doing throughout the world — whether in Ireland, Puerto Rico, India or Singapore — to improve the industry’s quality and efficiency standards.