The Government has pledged to attract investment to Donegal to replace the 560 jobs that will be lost after Hospira's decision to close its plant in Donegal town.
Minister for Agriculture Mary Coughlan said she regretted the decision of Hospira.
"I am in touch with my cabinet colleague Micheál Martin to find a replacement industry as a matter of urgency and I will be pressing for the Government's decentralisation plans for Donegal town to be fast-tracked in order to address quickly what is a serious blow to the town," the Minister and Fianna Fáil TD for Donegal South West said.
Minister of State at the Department of the Marine Pat the Cope Gallagher said the State's Development Agencies are being mobilised to provide support to the workers and assist them in finding alternative employment.
"I am aware that it's of cold comfort to those facing redundancy, but in the last six months the IDA has approved approximately 700 additional jobs for the north west," he said.
He welcomed Hospira's announcement that they will be consulting closely with staff and unions to try to seek agreement on what "must be a generous redundancy package, even for those only serving a short period".
A statement from the company said that the combination of excess manufacturing capacity within Hospira and the high cost of manufacturing in Ireland had greatly influenced the decision.
A recent survey by the Irish Small and Medium Enterprises Association (ISME) said business costs over the last three years increased by 30 per cent - almost three times the rate of inflation.
ISME today said the cost of doing business in Ireland is acting as a major obstacle to business security and adversely affecting profit levels of many companies. "It is no coincidence that 30,000 manufacturing jobs have been lost in the last three years alone," it said.
ISME chief executive Mark Fielding warned the Hospira announcement, coming fast on the heels of the closure of Donegal Parian China, is going to leave a huge economic void in the South Donegal area. "The estimated cost to the local economy would be in the region of €35 million."
Fine Gael Donegal South West TD Dinny McGinley described the closure as "an economic and industrial bombshell for the entire region."
Mr McGinley called on the Government to intervene and "retrieve something out of the impending shambles which, if not avoided, will leave south Donegal an industrial wasteland".
Labour Enterprise, Trade and Employment spokesman Brendan Howlin said Donegal has always suffered unemployment rates disproportionate to the rest of the country, and that the immediate priority must be to attract new businesses to the area.
The Green Party described the Government response to the job losses as "fatuous". Green Party Finance spokesman Dan Boyle said Ms Coughlan's suggestion that the Government's should speed up decentralisation "only goes to show the poverty of Government thinking in this area, the lack of any real regional policy and a seeming indifference to protecting or enhancing manufacturing industry in this country."