Cork to feel pharma merger ‘pain’

CORK will suffer “some pain” because of mergers and acquisitions in the pharmaceutical industry, according to IDA chief executive Barry O’Leary.

He said every single one of the multinationals that operate in Ireland has too many plants in its network, adding that the ones most at risk around the globe are in high-cost locations.

“If some of those are in Ireland, they will be under definite pressure and some of them are in Ireland,” he said.

“Some of the biggest companies in the world are coming together.

“At the same time those companies do not have enough new products coming on-stream and they are losing out.

“The sector will be under pressure but there is great opportunity in services in the pharmaceutical area, including shared services, supply chain management and intellectual property,” added Mr O’Leary, who was appearing before the Joint Committee on Enterprise, Trade and Employment.

Mr O’Leary said the fundamentals for the foreign direct investment (FDI) companies in Ireland have not changed.

“If anything, they have improved from a competitiveness point of view, but if one is an executive that does not know Ireland and one is reading an article about the Irish economy, the drop in GNP and the banking crisis then the first element that could be hit is foreign direct investment,” he added.

“That is one of the reasons around September when it began to cool down a bit we commenced an advertising and branding programme to raise this country’s profile around the nine airports, television stations, and in newspapers such as The Wall Street Journal. That is why we also used Google, Facebook, Boston Scientific and five other companies to row in behind Ireland’s reputation.”

Mr O’Leary said reporting on Ireland has been “quite favourable” in recent times but there was still the occasional negative article.

The IDA is concentrating on creating jobs in three main sectors: global services, research and development and high-end manufacturing. It plans to create 62,000 jobs over the coming years as part of a new strategy.

“The more successful we are in doing that, the fewer the jobs that will be lost,” he said.

Fine Gael TD Deirdre Clune expressed alarm at Mr O’Leary's comments to the joint committee and the potential threat to jobs.

Ms Clune said she was “very concerned” about the impact rationalisation may have on the pharmaceutical industry in Ireland.

“Current employment within the industry in Ireland has mainly focused on production,” she said.

“Now we need to broaden this and develop Ireland as an attractive location not just for production but also for services, management and research and development,” she added.