Major pharmaceutical companies, including GlaxoSmithKline (GSK), Eli Lilly and Roche, are increasing their research operations in China. China offers scientific talent, many contract research organizations (CROs), lower costs and a fast-growing drug market. By 2020, the country is predicted to be the world’s second largest drug market. For many of these companies, China offers a testing ground for new approaches to R&D. Zhangjiang Hi-Tech Park is the predominant location for drug R&D facilities in Shanghai, however, GSK’s R&D facility is located in Puxi due to the area’s research institutes, universities and hospitals. GSK’s investment is China is larger than its rivals, and it plans to capitalize on its Chinese collaborations and to develop drugs by studying Asians’ susceptibility to diseases. In contrast, Eli Lilly’s Shanghai operation consists of a rented office with 10 employees, who coordinate the company’s subcontracting of multiple CROs. Pfizer is planning a similar operation involving CROs and universities, in addition to its R&D center in the country. Subcontracting keeps costs low and allows for flexibility and parallel R&D. Roche employs a similar approach combining in-house R&D and outsourcing. The company’s operation is partly focused on adapting existing drugs to the Chinese population. Roche also plans to develop drugs in China for the Western market. However, Chinese CROs are inexperienced in screening drug candidates for biological activities. Another potential stumbling block is the rising cost of researchers. Source: Nature

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