Willie O'Dea (Limerick City, Fianna Fail)
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The job losses in Cork represent a quarter of the Pfizer jobs force in the county. Our first thoughts must be with the workers who are displaced. It is incumbent on us and on the Government in particular to ensure those workers get the best possible deal. They are going out into one of the worst labour markets in the history of the country. It will be very difficult for those generally well paid workers to gain alternative employment, especially in this country.

The fact Pfizer has decided to reduce its workforce in Cork by one quarter is pretty ominous for a number of reasons. First, I am very familiar with the Pfizer company because it has a major plant in my constituency which has been one of the mainstays of employment in the mid-west for decades. It is a very progressive company that usually does not let people go, and its pay and conditions are among the best in the industry in Ireland. Second, most of the jobs going in Cork are high-end jobs, involving highly educated and skilled people. This is not the traditional fall-out where some manufacturing company moves to a cheaper jurisdiction, as happened with part of the Dell plant in Limerick. Third, the job losses in Cork are inextricably linked with the fact that the patent on Lipitor has expired. The Minister will be aware this phenomenon will have a devastating impact on employment in the pharmaceutical industry in Ireland, which employs more than 25,000 people in well-paid jobs. This is the start of a trend as quite a number of patents are due to expire which will have a devastating impact on employment in the pharmaceutical industry.

The Minister will also be aware of newspaper reports on the decision of Atlantic Homecare to apply for examinership. The company has made a proposal to the High Court involving a restructuring which will lead to the loss of a certain number of jobs. We all hope the application to the High Court will be successful, an accommodation with creditors will be reached, and the job losses will stop at what has been announced. However, I thought it was very significant that in the explanation of its decision, the company emphasised the fact it was caught by unavailability of legislation to deal with upward-only rent reviews that had been historically agreed.

In the recent general election, the current Government parties faithfully promised that upward-only rent reviews, be they present, past or future, would be legislated out of existence. They said they had legal advice to this effect. Since the election, some of the victims of upward-only rent reviews have got legal advice of their own which is very compelling. I would love to see the Government's legal advice and I would particularly like to see the advice the Labour Party claimed it had available before the election.

Atlantic Homecare joins a long list of companies - Xtra-vision, Golden Discs and Arnotts, to name but a few - that have thrown people out of the workforce and onto the industrial scrapheap because they were unable to renegotiate upward-only rent review clauses that had been agreed before the recent legislation that banned such rent from that date. Has the Government been considering the impact on employment of the lack of a remedy for upward-only rent reviews? Has it any proposals to deal with the situation?

Richard Bruton (Dublin North Central, Fine Gael)
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I thank the Deputy for raising these matters. The expiry of the patent on products manufactured by Pfizer has, unfortunately, resulted in the announcement of the loss of 177 positions in Cork this week. My thoughts are, obviously, with the workers and their families. All the applicable supports of the State will be made available to the workers if they are needed.

I have spoken to the company about the situation. These two quality plants in Cork will still employ more than 500 people and will be adapting to achieve operational excellence and deliver competitive manufacturing for the company. The company has also confirmed Ireland remains a key strategic location. Factoring in this decision, Pfizer will still employ almost 4,000 people in Ireland across eight locations. In September 2011, the company announced a €145 million investment in its Grange Castle site to develop a new site to expand the Irish manufacturing process for an invasive pneumococcal vaccine.

The Deputy is correct that the expiry of patents is a problem for a number of companies. In the case of Pfizer, Lipitor was the biggest selling drug in the world by a factor of two. Virtually all of the API was in Cork, as was most of the formulation. Having other investments in the pipeline, Pfizer is itself adapting to the challenges of products going off patent. IDA Ireland has been working for many years to minimise the threat to jobs posed by products coming off patent and has been seeking to diversify Ireland's pharmaceutical base. Its strategy has been to win leading company investment and to diversify the breadth of operations over multi-product sites, including associated services and development of new compounds. Ireland has been enormously successful in attracting eight of the major global players and the world's number one biotechnology company to manufacture from Ireland. IDA Ireland has focused, in particular, on biopharmaceuticals, which represent the next wave of opportunity in the industry, and has been very successful in attracting leading companies, with the result that Ireland now has a globally leading biopharmaceutical cluster in the next generation of pharmaceutical products.

I have been informed by IDA Ireland that employment in their client companies is surveyed annually by Forfás in its annual employment survey. Between 2010 and 2011 net employment in IDA client companies in the pharmaceutical and healthcare services sector increased by approximately 1,400. This is in the context of an overall net gain in employment of 6,118 in 2011. In the first six months of 2012 alone, Ireland has won five major investments in the pharma and biopharma sectors with the capacity to create 1,175 new jobs. We are successfully anticipating the changes that are happening in this sector, as some products come to the end of their protected life and move on to others.

IDA Ireland has assured me that it will continue to seek to win new investments in the pharmaceutical industry and to win large scale investments in product development and capability to enable its existing client companies take on new product mandates.

The examinership at Atlantic Homecare is disappointing and reflects the difficulties facing some retail operators, particularly those with exposure to the construction sector. My thoughts are with the workers whose jobs are under threat at Atlantic Homecare. As has been publicly stated, the 13 store chain has been losing money for the last five years, with losses of €11 million last year. The company has cited high rents as a factor and it is to be hoped this will be addressed in the course of the examinership.

As Deputy O'Dea pointed out, the examinership process will last several months and the stores will continue to trade as usual during the process. The examiner will be preparing a plan for the survival of the business. The company is engaging with the trade union representing staff interests.

Deputy O'Dea raised this issue on previous occasions. He knows the legal advice to the Government is that the hoped for removal of upward only rent provisions from existing contracts could not be implemented by Government.

Willie O'Dea (Limerick City, Fianna Fail)
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I am glad the Minister and IDA Ireland are alive to the danger to employment in the pharmaceutical industry from patents expiring. A number of patents are due to expire in the next two years. This presents a real challenge to maintaining employment in the pharmaceutical industry which, as the Minister knows, is a source of lucrative employment, providing more than 25,000 well-paid jobs. It is also one of the areas the Government has targeted to build and increase employment in the country.

With regard to Atlantic Homecare, the Minister said the company has cited high rents as a factor and that he hopes this will be addressed in the course of the examinership. There is no doubt that it will be addressed in the course of the examinership. However, it is because of high rents that the examinership has had to take place, and the examinership has resulted in the loss of jobs. That is the reality.

The Minister may be aware that Atlantic Homecare was acquired by the Grafton Group, which is continuing to trade very profitably. It is a major deficiency in company law that if a company or group acquires another company, the main group can continue to trade profitably while choosing to put one of its units into examinership. That is a deficiency in company law that should be looked at by the Minister and the Government in the context of the forthcoming Companies Bill.

Richard Bruton (Dublin North Central, Fine Gael)
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The situation is not quite as the Deputy projects. Rent is certainly cited as a factor in the examinership of Atlantic Homecare but the big factor is the collapse in revenue. That is clearly stated by the company, and is not untypical of many companies closely connected to the construction sector.

Deputy O'Dea raises a fundamental point of company law. To move from a system that allows the establishment of independent companies with separate businesses while having the protection of limited liability would be a substantial departure in company policy. A change of such major significance would have to be considered long and hard. We know that serial entrepreneurs set up different companies and are often very successful. The ability to establish companies and to have the protection of limited liability is something we give to entrepreneurs. I would not lightly enter into a commitment to accept the Deputy's point. However, I will have my officials look at the suggestion, since the Deputy is putting it forward.