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P. 18-23 /

Emerging outsourcing destinations


JZMed, Inc. PO Box 9680, Rensselaer, NY 12144, USA


Attracted by the large pool of talents in emerging countries whose technical skills and capabilities are being rapidly improved, coupled with the attraction of the fast growing local pharmaceutical markets, increasing numbers of drug companies around the world now include emerging countries when they consider an outsourcing destination. The centre of the global pharmaceutical outsourcing industry, especially for small molecule drug R&D and manufacturing, is thus gradually shifting toward the emerging markets. This article has discussed in detail the latest development trends of global pharmaceutical outsourcing, the rationales of major pharma companies choosing China and India, the two key emerging markets, as their primary outsourcing destinations, the strengths and weaknesses each of these two countries currently possesses, the different outsourcing strategies the global major pharma companies are actually implementing in these two emerging markets, and the outlook of the future development potentials of the local pharmaceutical outsourcing markets.


It has been widely recognized that the global pharmaceutical industry has been experiencing dramatic changes underlined by a series of actions taken in recent years by all major pharma companies, including restructuring their internal organizations and increasing externalizations. These actions largely result from a number of challenges that have been facing the entire pharmaceutical industry: discovering a new medicine has become more and more difficult and costly, which translates to low R&D productivities; and a number of blockbuster drugs have lost their patent protections, resulting in the loss of a big chunk of sales revenues and operating profits in most major pharma companies.
These challenges have indicated that the traditional models in pharmaceutical R&D and manufacturing do not work appropriately in the modern era as they lack efficiency and productivity. The situation has thus forced all major pharmaceutical companies to pursue new strategies across the entire value chain of R&D, manufacturing and even marketing, which has resulted in the evolving of a number of new operation models industry-wide in recent ye ...