Pharma represents a highly attractive career option as the industry here moves into a new phase of evolution.

In less than 30 years, Ireland's pharmaceutical industry has become the country's largest exporter and one of its major employers. For the economy the pharmaceutical sector has become integral to the nation's prosperity, generating €3bn in tax payments and making Ireland one of the top four locations for the industry worldwide.

In recent weeks, there have been investment announcements from Lilly, Pfizer, GlaxoSmithKline and Genzyme totalling €750mn.

While, in 2004, Wyeth Medica Ireland announced the biggest foreign direct investment in the history of the State - a 1.5bn euro investment in a 90-acre site in Grangecastle, Co Dublin - bringing the overall value of industry investment here to more than 40bn euro.

Clearly, Ireland's pharmaceutical industry is on a roll that has been steadily building momentum, having attracted 14 of the world's top 15 pharmaceutical companies to set up operations here. Year-on-year job growth in the sector has been increasing by 1,000 annually for the past five years, with 24,500 now employed directly in the industry and many more employed by its suppliers.

"The fact that nine of the top 10 companies here have Irish CEOs is a very strong selling point," says Barry O'Leary, IDA Ireland, the offices of which have been pivotal in attracting the industry here. "Ireland's pharma industry has gone from strength to strength, with its expanding profile and capabilities here steadily attracting more companies and investment. The difference with pharma is that it's an expensive industry to build. You wouldn't be far off 1m euro per employee in terms of investment."

RAMPING UP

In 2006, Ireland's pharmaceutical sector generated 50pc of the country's exports, making us the biggest net exporter of medicines worldwide. In a decade of improving exports across all sectors, such successes might seem to be almost the norm. But the achievement of Ireland's pharmaceutical sector has been considerable, with medicines now accounting for 1 of every 5 of Irish exports.

In 2003, for instance, Ireland exported 10 times the value of pharmaceuticals exported by Germany, a country that has spawned some of the industry's biggest pharmaceutical companies and medicines. For a country that began from a standing start in the Sixties, Ireland's growth in pharmaceuticals has been impressive by any standards, with 12 of the world's best-selling medicines being produced here.

With a further €1bn of investment announced already this year, Ireland is showing itself to be much more than just a short-term expedient for multinationals seeking out tax breaks. A skilled labour force, a favourable Government attitude, tax incentives, market access, climate and a constantly improving infrastructure have all been contributors in making Ireland one of the world's most attractive investment locations for the industry, now only rivalled by Singapore, Puerto Rico and Switzerland, according to IDA Ireland.

Competitive advantage for the future, however, may rely less on financial incentives than it will on Ireland's reputation as a centre for innovation in developing new medicines. This means, in managerial jargon, moving up the value chain (the steps from concept to manufacturing in developing a product) from manufacturing-led to knowledge-led activities.

THE MOVE UP THE VALUE CHAIN

Since the first investments in the Sixties and Seventies, Ireland's pharma industry has steadily moved from being manufacturing led to knowledge led. As a research-driven industry, pharmaceutical companies reinvest 15-20pc of their sales in research and development (R&D).

Medicines typically cost upwards of €1bn to develop and that R&D investment, which in 2006 amounted to €21.5bn in Europe alone, makes this a truly knowledge-based industry. Five of the top 10 spenders in European R&D are pharmaceutical companies.

Professor Dermot Kelleher of Trinity College Dublin, a member of the Health Research Board, argues that Ireland is now regaining its historical tradition of innovation in medicine, an area it dominated in the 19th Century through the work of then pioneering medical innovators such as Robert Graves, William Stokes, Dominic Corrigan, Abrahem Colles and EJ Conway.

Kelleher defines innovation as "the conversion of knowledge and ideas into a benefit which may be for commercial use or the public good", something that is now reaching fruition here through public and private investment.

By providing the R&D medicines for bigger companies, Ireland's rapidly growing biotech sector is now providing just such an opportunity, he argues, along with many exciting career and entrepreneurial opportunities.

"Ideas are now key. New technologies level the playing field, giving new, smaller companies similar capabilities to larger ones. We're getting a respectable level of innovation here. The challenge now is developing the right culture so it can prosper," he says.

Such innovation and R&D activities will become the key drivers in bringing Ireland's pharmaceutical industry to its next level of competitiveness in what is truly a global industry.

"Manufacturing sites need to have the technical capability to compete when new drugs are coming down the pipeline and corporations look to decide on where to locate these facilities around the globe," says O'Leary.

"So you must have more capabilities onsite; it's not enough just to have lower tax rates, because other jurisdictions have lower ones. The technical capability and the people become a far more critical piece of the whole thing."

The result has been a series of investments linking industry with academic research, with €36m invested last year by various companies. Bristol Myers Squibb, one of the first arrivals here in 1964, spent €9.6m on research facilities at Dublin City University. Wyeth also invested in University College Dublin's Conway Institute as part of its €1.8bn biotech investment here.

Similarly, Pfizer, GlaxoSmithKline, Johnson & Johnson, Lilly, Merck Sharp & Dohme, Genzyme, Servier and others have all made recent multimillion euro investments in creating R&D capability in this country, while the announcement of Lilly's investment in Cork is mirrored by a the presence of a new pharmacy faculty in University College Cork.

"These investments represent more than just links between industry and academia," says John McLaughlin, president of the Irish Pharmaceutical Healthcare Association.

"These have the capability to turn themselves into major hubs of research that not just benefit the economy here, but also bring major benefits for patients by providing new and better treatments. If you consider that more than a quarter of the world's medicines have been developed in the UK, our neighbour, there is every reason we should aim for some of this market."

GLOBAL MARKETS MEAN GLOBAL COMPETITION

Ireland's success has of course been based on its ability to export to countries that could soon be competing for the same work. Pharmaceutical investments are prized by development agencies worldwide because of the depth of their investment, highly skilled employment base and resulting longer-term tenure. But in such a globally competitive market, security can only be maintained through competitiveness. "Ireland Inc needs to nurture the sector as its future could be a lot less certain, should the country take it for granted," says director of PharmaChemical Ireland, Matt Moran. The rising costs of doing business here, ongoing government support for the sector, tax and infrastructural issues are all pressing concerns.

In response to such competition, companies here have focused on developing capabilities that generate and deliver higher value - by consistently moving up the value chain. Increasing the numbers and value of services by improving workforce skills, research capabilities and infrastructure have become ever more important when competing with countries with vastly lower labour costs and zero corporate tax rates such as Singapore and Switzerland.

Singapore, for example, offers 0pc tax compared with Ireland's rate of 12.5pc and Puerto Rico's 3pc, while boasting far lower labour costs. Switzerland, as a non-EU member, can waive tax rates on specific industry activities, enabling it to become an R&D powerhouse for the industry.

Research in pharmaceuticals extends from developing new molecules for medical use to clinical trials and discovering how to produce safe and viable products.

"In a multinational environment, every site is trying to convince senior management that it should be the site for investment," says John Condon, EMEA director of public affairs at Merck Sharp & Dohme's manufacturing division.

"By including research in your manufacturing activities, you're familiar with the process at a much earlier stage, so if the drug gets market approval later then you're in a much better position to justify being able to produce it. It's all about internal competition."

For Ireland's pharmaceutical sector, the competitive challenges from overseas have meant evolving from bulk manufacturing of active agents to adding complementary activities, finishing completed products and researching and developing new products and production methods.

IDA Ireland's strategy focus has been to encourage companies to start earlier and finish later by adding activities from the pre-clinical stages to the launch. The emphasis is on introducing Irish-generated research as early as possible in the development cycle. Such value adding activities have only been possible through the expanding skill set of Irish workers and closer tie-ins with academia. The future of the industry lies in combining this immense manufacturing capability and expertise with the innovation that will drive product development.

Much of the success in adding new capabilities has been due to the calibre of the industry's people and their ability to upskill and deliver new areas of expertise.

"The calibre of the people working in the industry here has certainly made a major difference to our competitive advantage and has been a very significant factor in attracting investment here," says Moran. "Our workforce's ability and willingness to learn has been impressive at all levels of recruitment, something with which I think everyone in the industry would agree. In addition to the standard and supply of our graduates, postgraduates and others, the human factor has been a major source of competitive advantage for the industry in Ireland."

THE EDUCATION IMPERATIVE

Among the most critical factors in sustaining Ireland's competitive advantage is ensuring a constant stream of science graduates at second, third and postgraduate levels. "Industry has invested heavily in recent years promoting science and the results are startlingly evident with the increase in the number of students taking science subjects, but efforts are pointless without the necessary government investment in education," says Moran.

There are good reasons to consider careers in Ireland's pharmaceutical sector. In addition to a wide diversity of career opportunities, new figures from the Central Statistics Office show that workers in the sector earned almost 30pc more than the national average.

As the industry here moves towards being knowledge led in all its activities, the prospects for employees and the economy are considerable and growing. This still depends, however, on maintaining Ireland's extraordinary pharmaceutical manufacturing base.

Cultivating a business climate where innovation can flourish involves many factors, foremost of which must be acknowledging the extraordinary asset that the country has already created.

Diarmuid o Connor (Lilly), Dr John Lechleiter (President and CEO Eli Lilly and Company), Minister Micheal Martin (Former Minister for Enterprise, Trade and Employment), Barry O Leary (CEO IDA) and Bruce McDonald (Lilly) at the announcement of Eli Lilly's €400m investment as part of a multi phase programme to establish a Biopharmaceuticals Development and Manufacturing facility in Kinsale. The investment, which was supported by IDA Ireland, will require up to 200 jobs in the next 5 years.

Lilly announcement click http://www.idaireland.com/home/news.aspx?id=9&content_id=847 " onclick="window.open(this.href);return false;" onkeypress="window.open(this.href);return false;">here

Sponsored by the Irish Pharmaceutical Healthcare Association (IPHA)

The IPHA represents the international research-based pharmaceutical industry in Ireland. Its members include both manufacturers of prescription medicines and non-prescription or consumer health care medicines.

www.ipha.ie