Ireland’s low corporation tax strikes again, with the announcement that a US pharma company is to relocate here to avail of our 12.5 per cent regime before embarking on an acquisition spree.

Endo Health Solutions shares are up more than 42 per cent, according to Bloomberg, since the US painkiller manufacturer announced it was acquiring Canadian drug maker Paladin, which has substantial operations here. Because Paladin shareholders will own 20 per cent of the enlarged company, it will be able to reincorporate in Ireland and cut its tax to 20 per cent – compared with the headline US rate of 35 per cent –in time it may even go lower, explaining the trigger for the surge.

But what really seems to have caught the imagination of stock pickers is the track record of chief executive Rajiv De Silva who is behind the deal. De Silva is a former president of US generic drug maker Valeant, which pulled a similar tax cutting move in 2010 by merging with Canada’s Biovail to avail of that country’s 15 per cent rate.

This provided the platform for an acquisition spree that saw the company make more acquisitions than any of its peers in the past three years – 33 transactions worth $18 billion. The result was a sevenfold increase in its share price and De Silva is now expected to repeat the trick at Endo.

“When you’re a large pharma, acquisitions are really the most cost-efficient way to build your revenue. If you move to Ireland, it gives you the ability to effectively bid and pick up the smaller companies when their products look like they might be able to make it to market,” Jim Molloy, a Boston-based analyst at Janney Montgomery Scott helpfully explained to Bloomberg.

It is a well-worn road, some would argue. Activis moved to Ireland following the acquisition of Warner Chilcott this year and Perrigo will be arriving shortly once its takeover of Elan is complete. Alkermes is also here having bought Elan’s drug technology business, as is the smaller Jazz Pharmaceuticals after acquiring Azur Pharma.

The tax-driven, jobs-lite nature of these deals is not going to help with the defence of Ireland’s low-tax strategy; but they never said it would be easy.