InBus_Win09_1-55:InBusiness 1-61 11/12/2009 16:20 Page 51
Life Sciences Report | FEATURE
Future
for Pharma
+++++++++++++++++++++++++++++++++++++++
25,000 people are employed in the life sciences sector and in 2008, it accounted for €44bn in
exports. In 2009, the pharma-chemical industry is one of the few to have grown. Brenda Collins
finds out why is it so impervious to the recession.
+++++++++++++++++++++++++++++++++++++++
THE IRISH ECONOMY shrank by about 7.5 indication of the extent to which people plant in Ringaskiddy, Co. Cork. It has since
per cent in 2009. Every aspect of ‘Ireland Inc’ continue to spend money on healthcare, expanded its facilities and currently employs
has taken a hit in the last two years and for a even when money is tight.” about 2,000 people (not including its recently
variety of companies it has left permanent scars. acquired workforce in Wyeth). In the last 30
However, comparatively speaking, LONG TRADITION years, a combination of factors has been
pharmaceuticals and biotechnology have Whereas other more recently invested drawing massive investment from
emerged from round-one barely bruised. multinationals have moved their business to pharmaceutical companies. Firstly, our low
Despite challenging economic conditions, the low-cost economies in eastern Europe, the corporate tax rate (just 12.5 per cent,
industry continues to make a robust pharmaceutical industry’s deeply-laid roots also compared to 35 per cent in the US and 28
contribution to the Irish economy. contribute to its staying power. Ireland has
The pharma sector has a natural resistance to been attracting this kind of business since the
the world’s economic fancies. Demand will rise 1960s when Pfizer first set up its citric acid
and fall for housing, but illness is indiscriminate
and, in the long run, people are always willing
to invest in their fundamental survival. If
“ABOUT A QUARTER OF
anything, there is a positive correlation between
FORECLOSURES ARE
poor economic outlook and diminishing
national health due to the increased levels of
THE RESULT OF
stress brought about by loss of income and
MEDICAL COSTS WHICH
stricter budgeting. So, by its very nature, the
pharmaceutical industry is better positioned to
GIVES AN INDICATION OF
withstand the kind of financial storms that have
THE EXTENT TO WHICH
been flogging Irish businesses for the last 18
months. “Healthcare is one of the last things
PEOPLE CONTINUE TO
people cut from their expenditures,” says Ron
SPEND MONEY ON
Davies, professor of economics in UCD. “In
the US, about a quarter of foreclosures are
HEALTHCARE.”
the result of medical costs which gives an – Ron Davies Ron Davies, Professor of Economics, UCD.
InBusiness Winter 09 51
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