DUBLIN – Confirmation from Regeneron Pharmaceuticals Inc. last week that it would locate its first overseas production facility in Ireland provided the country’s foreign direct investment (FDI) agency IDA Ireland with a welcome measure of seasonal good cheer.

Coming immediately after Ireland exited a highly unpopular three-year bailout program with the International Monetary Fund and the European Central Bank – and on top of a better-than-expected third quarter GDP growth rate of 1.5 percent – it provided an additional boost to the country’s efforts to claw its way toward economic recovery.

After previously disclosing that it was in talks to acquire a facility in Ireland, Tarrytown, NY-based Regeneron confirmed its purchase of a 400,000-square-foot plant on the outskirts of Limerick. Construction on the $300 million project is to begin in the new year. The facility – which previously housed a Dell Inc. PC manufacturing operation that closed its doors in 2009 – is due to be completed by the end of 2015.

The project could be classified as the first “second-generation” biotechnology win for IDA Ireland. “We think Regeneron could be a bellwether investment for us,” the agency’s head of life sciences, Barry Heavey, told BioWorld Today. The agency is actively bidding for several more.

“There is a couple we would have in the pipeline, which would have the potential to be significant investments,” he said. “We’re starting to see a little uptick in new builds.”

Until now, first-generation biotech firms Amgen Inc., of Thousand Oaks, Calf., and Genzyme (prior to its acquisition by Paris-based Sanofi Group), were the only biotechs that established manufacturing plants in Ireland, although numerous big pharma firms have located biopharma production facilities here, including Eli Lilly and Co., of Indianapolis; Wyeth, now part of New York-based Pfizer Inc.; and Allergan Inc., of Irvine, Calif. Some of these have come about through biotech acquisitions.

“Imclone would have been on our target list for a long time” “We’ve won Imclone through acquisition by Lilly,” Heavey said. Independent biotechs that reach the drug manufacturing stage remain a rare species, of course. “Regeneron is unusual in the sense that they’ve managed to survive the slings and arrows of clinical trials without being acquired,” Heavey said. “Right now there are not that many Regenerons floating around to cherry pick from.”

Even so, the buoyant initial public offering market of 2013 and the increase in FDA new drug approvals of 2012 have helped to instill some sense of optimism, even if older parts of the industry are still undergoing a shakeout. Because pharmaceutical manufacturing is an important pillar of Ireland’s export-oriented economy, the pharma industry’s patent cliff became a mainstream media topic during 2013.

The loss of patent protection on several blockbusters produced in Ireland, chief among them Pfizer Inc.’s Lipitor (atorvastatin calcium), have had a tangible impact on the country’s trade figures.

According to the Irish Exporters Association, pharmaceutical exports fell by 8.5 percent during the first nine months of the year, although they still accounted for 59 percent of total merchandise exports (which exclude services) and are on track to hit about €50 billion (US$68.4) in 2013.

Several production facilities in Ireland were causalities of the global retrenchment in the industry, including Pfizer’s Newbridge plant, in county Kildare, which is laying off 150 employees as it shuts down a packaging facility. A Merck & Co. plant in Swords, north of Dublin, which employs 570 people, is one of the casualties of its latest round of global job cuts, involving 8,500 positions. The entire plant will be shut down by 2017, and 130 employees will go in the coming months.

Industry watchers hope that that will be the end of the bad news. “I think the patent cliff has more or less washed its way through the system at this stage,” Matt Moran, director of Pharmachemical Ireland, the manufacturers’ lobby group, told BioWorld Today. The closures and job losses are being offset by new projects coming onstream elsewhere.

“We’ve about €1.7 billion going into the ground at the moment,” Moran said. Pfizer continues to expand capacity at its Grangecastle facility, which Wyeth originally built to make the TNF-alpha inhibitor Enbrel (etanercept). This year it announced plans to invest €100 million to increase its Enbrel production capacity, on top of a €200 million investment last year associated with the production of Prevnar (pneumococcal conjugate vaccine). Sanofi is investing €44 million in its Waterford plant for filling its diabetic drug Lantus (insulin glargine). “That facility has gone from a nichebuster facility producing an orphan drug to one producing a blockbuster drug,” Heavey said.

Moran also welcomed recent news of Ireland’s low incidence of import alerts in comparison with other international manufacturing locations, such as China and India. “Ireland’s record in terms of quality is a big selling point, and it always will be,” he said. (See BioWorld Asia, Dec. 4, 2013.)

His group is seeking European inspections of overseas plants. “We have for a long time been persuading the European authorities to do it, and they won’t do it,” Moran said. “Basically we’re pushing for a level playing field.”