http://investors.com/editorial/IBDArticles.asp?artsec=22&issue=20071130 The Next Chinese Outsourcing Wave: Drug Development "That's particularly true of contract research organizations, or CROs. These firms conduct tests on and trials of new biopharma products for the companies that own the technology." "In the U.S., pharma companies outsource 33% of the $45 billion they spend on R&D yearly, Peterson says. He expects that figure to rise to 41% by 2009." "The result would pose a challenge to the current high-price, high-margin big biopharma model, he says. Drug makers will have to cut costs. One way they would do that is outsource R&D to China and other low-cost regions." "Outsourcing already is becoming more prevalent in the drug industry. After conducting interviews with 185 senior pharma executives worldwide, PricewaterhouseCoopers found that 72% of multinational drug firms have been considering outsourcing clinical trials to Asia." "The company's business model is simple, Forman says: "WuXi can replace one Pfizer (PFE) Ph.D. in New London, Conn., with 10 scientists in Shanghai."