Ireland - where local meets global

From its early days in the 1960s and '70s, when a handful of US companies set up greenfield bulk production facilities in the country to supply their finishing operations elsewhere in Europe, Ireland's pharmaceuticals industry has just gone on growing - to such an extent that the country is now one of the world's largest exporters of pharmaceuticals and fine chemicals.

Thirteen out of the top 15 global pharma companies have manufacturing operations there and, overall, around 120 overseas companies employ 20,000 and export $38billion worth of products each year, representing nearly 30 per cent of Ireland's total exports.

According to the government agency Enterprise Ireland, the total investment by overseas companies in the country's pharmaceuticals sector is 'conservatively estimated' at $15billion. Even at a time of mergers and acquisitions across the global industry, there have been no plant closures among the pharma companies in Ireland, and the sector continues to grow at approximately 11 per cent a year. Among major developments currently under way are Wyeth's 1.2million ft2 biopharmaceutical plant near Dublin, Genzyme's 200 000 ft2 manufacturing, formulation and filling complex at Waterford, and the recently announced E7million R&D facility for GlaxoSmithKline at its primary pharmaceuticals plant in Carrigaline, near Cork.

There is no doubt that Ireland's generous tax incentives for inwards investment have played an important part in attracting and retaining so many of these leading pharma companies, but there are plenty of other factors involved. A combination of high quality science and engineering graduates and a strong emphasis on establishing links between industry and the universities, for example, is an obvious attraction for the research-centred pharma sector. As is a burgeoning process engineering infrastructure, which has clearly benefited from the presence of so many multinational customers on its doorstep.

One area of engineering expertise that predates the pharma revolution, however, is stainless steel fabrication. Many of the indigenous Irish fabricators can trace their origins to supplying the country's dairy, food and beverage industries. These are still big markets, of course, and their increasing demand for quality finishing is beginning to follow that of the heavily regulated pharma sector. But, according to Pat O'Connor, sales and marketing director of Kells Stainless, 'the inflow of pharmaceutical and chemical companies into the country has raised standards generally, bringing with it the need for the good technical background that we have today'.

Located in the eponymous historic rural town, Kells is well versed in the requirements of the dairy, milk powder and cheese industries, but has expanded since its start in 1988 into one of the country's leading fabricators of stainless steel tanks and vessels for the pharmaceutical and other process industries. Expansion has also come in the form of a successful UK office (in Bangor, North Wales) set up some years ago. Kells now averages around a third of its turnover from the UK.

As O'Connor explains, the export market is increasingly important to Irish fabricators. Domestic competition has increased on orders for atmospheric stainless steel tanks, particularly for the food and drink sectors, where the required quality is perhaps not yet up to pharma standards. Quality is very much an issue, however, on pressure vessels and here Kells believes it was the first Irish fabricator to conform to the PED regulations. Technical manager Dara Fay says the company is now verified as an auditing body for the PED and 'is the only fabricator in Ireland to be able to offer this service.'

Another fabricator with traditional dairy industry roots but now well established across many other process sectors is BCD Engineering, based at Charleville close to the heart of Ireland's pharmaceuticals centre around Cork. Describing itself as 'specialists in stainless steel process systems', BCD now operates five divisions offering a range of services from storage and pressure vessel design and fabrication (up to 300,000 litres), through design and installation of piping systems, to design and manufacture of complete modular, skid-mounted process units. Although the five group companies act autonomously where necessary, they can all come together and interact when working on major projects.

Giving an insight into the engineering capabilities of the group, BCD's engineering sales manager Finbar Smith says: 'we aim to take on at least two R&D projects a year to keep ahead. Past projects have involved investigations of heat exchange in coil jackets, and currently, using our in-house CFD capability, we are looking at agitator design in tanks and vessels.'

Touching on perhaps one of the reasons for the attraction of his and other Irish engineering companies to the global pharma companies, Smith emphasises this ability to do as much as possible within the company. 'We have a very low turnover of engineers, and can retain expert knowledge in-house,' he says. This in-house knowledge across different industry sectors gives BCD a distinct advantage, he believes, particularly when compared with the 'changing fortunes of engineers in the contracting scene'.

The attraction of local suppliers to global operators is not confined to the pharma companies, however. The EPC (engineering, procurement and construction) contractors themselves, while acting as main contractors or project managers, sub-contract significant orders to Irish companies. A case in point is Genzyme's new facility currently under construction in Waterford. The main contractor here is Jacobs Engineering, but the mechanical installation part of the project is in the hands of another Irish fabricator/process engineer, Radley Engineering.

Radley's responsibilities on this major project, due on stream in mid 2005, take in the installation of plant utilities such as boilers, air handling units, water-for-injection treatment plant and all services to the four-storey process plant building.

Radley's in-house operations take place on a seven-acre site at Dungarvan, Co Waterford, its home since the company was founded in 1972. Here there are two main fabrication workshops - one for carbon steel, the other for stainless fabrications - and all the modern facilities to produce storage tanks up to 360 000 litre in size and pressure vessels to 90 000 litre. For process or hygienic applications, Radley also offers a full polishing service for internal surfaces, and external surfaces where required for appearance purposes.

While listing key names such as GlaxoSmithKline, Merck Sharpe Dohme, Pfizer and Sc-hering Plough among the company's pharma clients, managing director Tom Radley also takes evident pride in a recent project far removed from the demands of industry, though no less taxing for all that. This is the Dublin Spire, a 120m high stainless steel monument erected at the beginning of this year at the top of the city's O'Connell Street.

Given the global nature of their operations, it's to be expected that the international pharma companies in Ireland lean towards the international EPC contractors for overall project management of their major developments. But one Irish company that can mount a challenge in terms of smaller turnkey plant design and project management is ProsCon.

Unlike many of the fabricators and other engineering companies serving the pharma industry, ProsCon's roots were firmly set in the sector from its beginnings in 1978 as a process control company supplying integrated systems to the then emerging industry.

While still very much involved in the control scene, ProsCon today is a fully integrated process technology company with an engineering staff of over 200 in four offices (including one in the UK at Southampton). Process business manager Ron LeBlanc believes ProsCon 'can go further than the contractors' in terms of the solutions it can offer to clients, particularly in the pharma industry which represents around 80 per cent of its business. Although not competing on the world scale (typical project size might be around E15million), ProsCon nevertheless has the in-house expertise to provide process design, detailed 3D plant design, fabrication and construction management, integrated control systems and enterprise-level IT.

ProsCon has also become something of a specialist in retrofit design using innovative 3D laser scanning technology to replicate existing plants in electronic 'virtual' mode.The importance of the contracting scene to indigenous equipment suppliers is highlighted by Michael O'Connell, md of Cork-based Flexachem Manufacturing. He says that 'around 40 per cent of our business comes through the engineering houses'.

That business is the manufacture and supply of PTFE-lined pipework and fittings for aggressive duties in the pharma and other process industries. And the supply side has seen significant changes in recent years. 'Many end-user companies and their contractors are reducing their vendor base and taking cost out of their operations,' explains O'Connell. This means Flexachem has had to strike up alliances with other suppliers when bidding for contracts, and maintain large amounts of stock to provide the flexibility expected by its customers. The upside, though, as O'Connell points out, is that those customers are all 'blue-chip' companies, so transactions are straightforward.

With the proliferation of pharma companies in the Cork area, O'Connell appreciates the dangers of over-capacity in the marketplace. Flexachem is therefore constantly looking at new opportunities and has recently developed the Hazcor sampling valve and high-purity sanitary devices to complement its traditional business. It is also currently involved in nine plant projects in the UK (through its offices in Runcorn), mainly in pharma.

Apart from the mainstream engineering activities, the control and instrumentation element of process engineering is also well served by Irish companies. Companies such as Monicon, Pollution Control Systems and DEM Machines, for example, have all benefited from Ireland's pharma boom years. These are all specialist companies with relatively niche products - gas detectors from Monicon, TOC analysers from Pollution Control, and weighing systems from DEM - that are in demand across not just the process sector, but general industrial applications as well.

Nevertheless, as Monicon's sales director David Owens says: 'the pharma sector is very good for us.' The Galway-based company's range of O2, N2 and CO2 gas detection systems is backed up a level of industry expertise that gets it involved with contractors needing advice on the installation of process gas monitoring systems. Monicon has been active in the UK since 1989, through the likes of Anachem and CBISS Design, but has also installed systems worldwide in other process and semicon industries.

Pollution Control Systems' main product is the BioTector range of on-line TOC analysers, based on technology originally developed in Norway. As md Martin Horan acknowledges, this is 'a very niche market, but we are promoting TOC as a process measurement, not just one for environmental monitoring'. The advantages the BioTector has over alternative methods is that no sample filtration is required and it can now deliver an accuracy of ±3 per cent from a rugged unit that can withstand the rigours of most industries.

Robustness is also a feature of the weighing systems produced by DEM Machines at its small factory in Naas, Co Kildare. The food industry was the company's main market initially, but it has now expanded into the pharma, chemical and general markets - including a project with the air traffic handling company Aer Rianta to equip all check-in desks at Dublin airport. Managing director Derek McClean says DEM is 'putting increasing emphasis on hazardous area scales. Process weighing is an increasing part of our business and around a third of our turnover is in the pharma sector.'

Although DEM has standard ranges of products, much of its business is non-standard, with an emphasis on systems software and control. Among several on-going R&D programmes, for example, is one to develop intelligent scales with dedicated function keys that can be customised by the end user or OEMs.

McClean believes DEM dominates its indigenous industrial weighing market with around 65 per cent of the business. He is therefore looking to the UK for further growth and has recently opened a sales office near Birmingham. As he says, with a comment that no doubt would be echoed by many of his countrymen, 'our products are too good to keep to ourselves.'