Ireland’s Crowning Glory: A Thriving MedTech and Pharmaceutical Industry
Across the world, patients depend on medications to treat infectious diseases, as well as special therapeutics for orphan drugs and rare diseases, clinical trials for new drugs to treat cancer and other conditions.
The process of drug discovery is an expensive one. Drug development is likewise a costly effort. As drug firms continue to maintain healthy profit margins while innovating new advances in public health and expanding global sales, the pharmaceutical industry has made significant changes over the past two decades. As health care systems struggle to maintain high quality of care while affording patients the opportunity to use increasingly more expensive prescription drugs, many drug manufacturers have relocated operations to other countries to save money. Today, it truly is a global pharmaceutical industry.
Pharma companies are no longer concentrated in North America but rather are situated in manufacturing hubs around the world. While generic drugs are often produced by pharmaceutical manufacturers in countries such as India and China in the developing world, medical devices, pharmaceutical products and MedTech goods are manufactured in other areas. Here is a look at one of the hottest production areas in the MedTech and pharmaceutical industry: Ireland.
Ireland is Home to 18 of the World’s Top 25 MedTech Firms, Exporting More Than €12 Billion of Medical Products Annually
Ireland is one of the foremost locations on the planet for pharmaceutical manufacturing as well as an active and thriving MedTech industry. Led by IDA Ireland, a government agency created to promote and stimulate export-led business in Ireland, the agency has been successful in helping the country become the second largest exporter of medical technologies in the world.
Reasons Why Ireland is a Hub for both the Pharmaceutical Industry and MedTech Industry:
- Low corporate tax rate
- 25% R&D tax credit for MedTech companies (typically dependent upon innovation and technologies)
- Financial incentives to companies conducting R&D throughout Ireland
- Incentives for companies which collaborate with academic institutions
- The regulatory culture
- Skilled, educated workforce
- English-speaking population
- With its EU membership, companies have access to a huge European market of over 500 million potential customers.
- Strong connections to the United States
- Geographic proximity to primary European markets as well as easy exporting to North America.
The marginal corporate tax rate of 12.4 percent is one of the lowest in the EU. The tax environment is shifting, however. The “double Irish” tax loophole which enables companies to shift some non-U.S. profits to Ireland to avoid higher tax burden is going to be phased out this year, but support for the lower tax rate is still steady and may not change.
Ireland is well known for its initiatives which are focused on providing support to companies which advance their technologies. Using the €500 million Disruptive Technologies Fund, debuted to help companies develop and commercialize innovations, the Irish government demonstrates that it is a willing partner in technology and innovation.
Some of the areas of specific interest in which the Disruptive Technologies Fund has invested include:
Augmented and Virtual Reality
Health and Wellbeing
Ireland has steadily invested in its advanced pharma manufacturing capacity, at an average rate of $1 billion in capital investments each year over the last five years. In addition, Ireland has a thriving medical technology industry. Currently 75% of the orthopedic knee production and 33% of the contact lenses in the world comes from production in Ireland. Areas of significant research and development in Ireland include cardiovascular stents; drug eluting balloons and neuro-modulation devices. Ireland is known to be a hub for Europe’s MedTech innovation.
In the first 9 months of 2019, 62% of Ireland’s exports were pharmaceutical goods
Ireland’s Educated, Skilled Workforce
A skilled workforce initially attracted the drug manufacturers and now Ireland is known for its innovative execution of bringing drug products to market efficiently without breaks in the supply chain. With one of the youngest, highly educated workforce populations in Europe, Ireland continually re-invests in higher level education.
Approximately 25,000 people work directly in Ireland’s pharma industry. Fifty percent of this workforce are third-level graduates. With an education system ranked in the top 10 in the world, it is notable that Ireland has the “highest level of STEM graduates per capita in the EU”.
STEM graduates including those from Engineering, Chemistry, Biochemistry and BioTechnology often have matriculated from Irish universities with deep collaborative links to the life sciences sector. The Irish pharmaceutical industry workforce is bolstered by university collaborative partnerships. The pharma industry provides feedback regarding skills needed to help foster the education needed to achieve and maintain a consistent state of excellence.
Facts about the Pharmaceutical Industry in Ireland
- The atmosphere in the Irish pharmaceutical industry is one of collaboration, fostering the sharing of best practices between companies on a practitioner-to-practitioner basis.
- Ireland hosts over 85 pharmaceutical companies, 9 of the top 10 major pharmaceutical companies in the world.
- 50 pharma and biopharma plants in Ireland are FDA approved
- Ireland is the third largest exporter of pharmaceuticals globally
- Ireland exports over $80 billion worth of products annually and is one of the largest exporters of pharmaceuticals worldwide
Ireland’s Pharmaceutical Industry Relies Heavily on Innovation and Technology
- Ireland’s pharmaceutical industry is a burgeoning hub of leading-edge facilities focused on process innovation. In addition, Ireland’s pharmaceutical industry has an excellent record in terms of clinical and academic research excellence. Continually funded by the government of Ireland, the importance of this investment in research has helped to establish and maintain Ireland’s reputation as a hub for research and development.
- Ireland boasts a pharmaceutical sector with specialized expertise in molecule development and manufacturing.
- Ireland’s drug manufacturers are concentrated primarily on small and large molecule manufacturing capabilities and face stiff challenges in dealing with the production of generic drugs offshore.
- The pharmaceutical industry is now focused on building a solid foundation for the next industry focus: next-generation therapeutics including cell and gene therapies which are in the early phases in Ireland.
- What is Ireland’s “secret weapon”? Ireland’s National Institute for Bioprocessing Research & Training (NIBRT) is shifting its focus. The NIBRT is a world-class institution, notable for its training resources and research solutions for the bioprocessing industry. Training tailored to cell and gene therapy for employees in the pharma sector is anticipated to help develop a solid supply of manufacturing professionals ready to meet the next-generation challenges. Over 4,000 people annually are provided with specific sector training by NIBRT from its cutting-edge campus.
- Digitization is top of mind for companies in Ireland. Several pharmaceutical companies in Ireland are piloting Industry 4.0 adoption, acting as “lighthouse projects”. This is supported by Ireland’s large IT industry. Notable brands including Novartis and Eli Lilly and Company are implementing next-generation platforms and data analytics operations in their facilities in Ireland. The transition to digitization is facilitating a cross-pollination of ideas between the IT, pharma and life sciences sectors and has attracted the attention of many clinical research companies and contract research organizations. Digitization has taken hold due to the global COVID-19 pandemic especially as it can enable the facilitation of digital clinical trials.
How the COVID-19 Pandemic Impacted Ireland’s Pharmaceutical Supply Chain
The strength of Ireland’s formidable pharmaceutical manufacturing industry is significantly dependent upon receiving active pharmaceutical ingredients (APIs) from India and China. The coronavirus pandemic proved that bottlenecks would form if Ireland was cut off from these critical building block materials. As countries locked down, global trade routes were disrupted.
Because supply chains tend to be optimized for costs, local inventory levels are often decreased to a minimum. To do this, manufacturing processes are dependent upon receiving just-in-time deliveries. When disruption in deliveries and inventory levels occurs, risks mount, often resulting in missed delivery dates, obstacles to process flows which tends to continue further on down the supply chain.
The pharmaceutical industry in Ireland has been collectively working on developing treatments and vaccines, including Coronavirus vaccines. The pharmaceutical industry continues to move ahead with the adoption of digital technologies due to the potential to improve patient engagement, patient care and process efficiencies. Virtual trials, for example would enable patients to participate in pharmaceutical research while safely secluded at home.
Industry overviews indicate that the life sciences industry in Ireland is innovating, healthy and increasingly improving. With digital technologies and other innovations abounding, discovery and development and exciting new therapies are being introduced and adopted by health insurance companies for patient treatment. Drug research and manufacturers have found a happy home in Ireland, for many household name drug manufacturers and popular brand name prescription drug products.
From coronavirus vaccines to breast cancer therapeutics, prescription drugs for high blood pressure and treatments for nervous system disorders, the pharmaceutical industry in Ireland is thriving. Ireland hosts pharmaceutical companies that are among the world’s largest, with expansive efforts across the board from research and development, clinical trials, biotechnology and other efforts across the pharmaceutical supply chain.
With close proximity to some of the world’s largest markets, Ireland’s success in MedTech and the pharmaceutical industry is due to factors including low corporate tax rates, research and development incentives, and a strong educational system that produces STEM graduates, Ireland is poised to continue its substantial record of success for many years to come.