Development officials in Ireland are excited about the spin-off benefits of getting a Regeneron plant in Limerick. The drugmaker is excited about having a new manufacturing facility that will produce the Irish tax benefits that are all the vogue in pharma these days.
According to the Limerick Leader, a development study says Regeneron's ($REGN) $300 million conversion of a former Dell computer plant will add about 300 jobs to the area economy, suppliers and such, once the facility is up and running. That is in addition to the 300 employees the Tarrytown, NY-based drugmaker said it will hire and the 800 construction workers that will be employed to get the 400,000-square-foot facility ready. The plant will roll out in two phases with about 185 employees needed by 2015 and the full 300 in 2016, the Leader reported.
This will be the second manufacturing facility for the maker of the hot eye drug Eylea, which already has a facility in Rensselaer, NY, that it is in the process of expanding. Not only will Regeneron add production in Europe, but it will pick up the tax benefits of having manufacturing and intellectual assets there. "The foundation of this operating model will be the establishment of a new manufacturing facility in Ireland and the migration of certain intellectual property ... to Ireland," CFO Robert Landry said during the company's earnings call Tuesday.
Regeneron is the second drugmaker in a week to tout the tax benefits of adding manufacturing in Ireland. Alexion ($ALXN), maker of orphan drug Soliris, established a supply-chain and logistics operation in Dublin with 50 people last year. Now the drugmaker is buying a vial-filling facility there and moving some intellectual property rights for Soliris and other compounds to Ireland. The results of all of this, CFO Vikas Sinha said during its recent earnings call, will be a tax rate that will run 10% to 11% on a non-GAAP basis before rising in 2016 to 16% to 18%.
Alexion will buy from Alkermes ($ALKS) two buildings the Irish drugmaker got with its 2011 acquisition of Elan's ($ELN) drug-delivery and manufacturing unit. The buildings at a complex in Athlone have sat unused for a number of years. Alexion will reportedly have 40 people at the facility. The spin-off benefit of that deal is that Alkermes gets some additional cash to bolster its own a €20 million ($27 million) plant expansion it has planned in Athlone.
- read the Limerick Leader story