Why Ireland has emerged as Europe’s biopharma hotspot

Ireland is attracting major investment from the largest pharma companies in the world. Ben Hargreaves finds out how the country has become one of the most significant locations in Europe for manufacturing and research, and how the success is rooted in a long-term strategy.

In recent years, the scale of biopharma investment into Ireland has accelerated, with some significant investments being made by the biggest companies in the industry. The country has always been a major hub in Europe for manufacturing, with many larger pharma companies holding a presence on the Emerald Isle for a number of years. One of the companies with a long-standing presence is Eli Lilly, and the company recently announced that it would double its investment on a manufacturing facility in Ireland. All told, this would bring its capital expenditure for the 500,000 sq. ft. space to $1 billion.

Lilly is joined in its expansion in Ireland by companies such as AstraZeneca, which is also currently going through the process of opening a manufacturing site in the country. The facility will see AZ spend $360 million to open the site, and it will become the company’s first manufacturing space in the country. At the end of last year, fellow pharma giant, Pfizer, also announced that it would be investing in its capabilities in the country. Similarly, the sums involved were significant, with €1.2 billion being set aside to expand its Dublin manufacturing site.

At present, there are more than 85 pharmaceutical companies operating out of Ireland, and it is the world’s third-largest exporter of pharmaceutical goods, which make up 39% of annual exports from the country. Clearly, Ireland has become a centre for biopharma manufacturing in Europe, but the larger question is why?

Rich history

One of the answers is that the country simply has a history of being the home of manufacturing in Europe. The first manufacturing operation in the country was set up in 1959 by Leo Laboratories, which set the country on a path towards being a leader in active pharmaceutical ingredient (API) manufacturing. This led to some of the major pharma companies setting up shop in the country, such as Novartis, GSK, and others. A significant breakthrough for the industry arrived when Wyeth Pharmaceuticals spent nearly $2 billion to create one of the largest biologics production sites in the world during the early 2000s.

IDA, an agency responsible for attracting and retaining investment in the country, spoke with pharmaphorum about how this history developed to form the industry today. The spokesperson explained that having a history in the country means that it makes sense to continue to invest in existing infrastructure: “A lot of companies that have been in Ireland for many years have multiple facilities and are continuing to invest. These companies have developed a very strong complement of staff and are very comfortable in operating in Ireland. “

Having reached out to Eli Lilly to understand more about the reasons behind its decision to expand in the country, and a company spokesperson reaffirmed the commentary from the IDA to pharmaphorum. The spokesperson noted, “Lilly has been continuously investing in Ireland over the past four decades and has a significant presence in the country [and] great track record of the other two Lilly sites in Ireland – at the manufacturing site at Kinsale and global capabilities centre at Little Island.”

A spokesperson for IBEC reiterated to pharmaphorum that Ireland’s success in attracting companies has been nurtured by a long-term strategy: “Ireland is attractive mainly due to a consolidated strategy by Government to attract pharma manufacturing to the country as far back as the 1960s. Initially, low corporate rates and access to land was a primary attractor. As the industry grew, a vibrant talent base and extraordinary levels of compliance with all regulation - both quality based and EHS based - have helped to sustain this growth.”

Creating a talent pool

One of the major challenges facing the expansion of capabilities and capacities in the bioprocessing industry is the lack of talent. The process of training and readying a workforce to operate a manufacturing facility takes time, which is why an available talent pool is such a crucial decision when choosing a location.

The spokesperson for Lilly outlined that the ‘talented and educated’ workforce in the Limerick region, the location of its expansion, was a crucial part of the process in opting for Ireland as a manufacturing base.

However, the available workforce in Ireland has not appeared out of nowhere, but instead represents a strategic decision on the part of the Irish government. The IDA spokesperson explained: “Biopharmaceutical manufacturing has been important to Ireland’s economy for over fifty years and Irish Government has ensured that talent for the industry continues to be produced through the universities and other training and apprenticeship programmes. When the bioprocessing industry began to grow rapidly, the Irish government established the National Institute for Biological Research and Training (NIBRT), which currently trains 5,000 people a year for the biologics industry, which is continuing to grow strongly.”

The NIBRT facility was announced in 2009 and officially completed in 2011, with the majority of the project cost being financed by the IDA. As well as providing training to professionals, the site also comprises 6,500 sq. m. that houses industrial bioprocessing equipment, including upstream, downstream, fill-finish, and the associated analytical facilities. This allows for manufacturing research, education, and training to be completed in the same location.

A bright future

According to the IDA spokesperson, the global pandemic has strengthened Ireland’s position as a hub for biopharma in Europe. This is due to the need to ensure ‘geographic resilience’ across supply chains, and companies re-examining their mix of internal and external manufacturing.

“This has caused a lot of companies to consider increasing their capacity in Europe and, as one of the leading European locations, we’ve certainly seen an increase in interest from both our existing investors and from investors new to investing in Ireland,” the IDA spokesperson said.

When asked about Brexit and whether this has also redirected investments towards the country, the spokesperson only noted that Ireland had benefited from the ‘inward investment space’, particularly in regulated spaces, such as the pharma industry.

Looking to the future, the spokesperson was positive about Ireland’s position to attract greater investment, outlining that its biopharma industry had doubled in the last ten years, employing 50,000 people directly and recording exports of over €100 billion annually. The spokesperson added that the agency is currently engaging with ‘a number of companies’ on projects that it hopes to announce later this year.

For Lilly and any future investments in the country, the spokesperson noted, “Lilly anticipates additional future investments in manufacturing to address growth expected from potential new medicines to treat diabetes, Alzheimer’s disease, cancer, and autoimmune conditions, although no decisions about any additional future manufacturing investments have been made.”

What is clear from speaking to various companies and organisations that have played a role in the development of Ireland’s biopharma base is that future growth and investment has sprung from a long-term strategy. The Irish government, industry associations, and the pharma industry itself helped build a solid foundation, which has culminated in Ireland becoming one of the centres of the industry in Europe, and the world.