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For years, Western pharmaceutical giants and China have engaged in a mutually profitable trade-off. The drug companies provide foreign investment and expertise in return for China offering low operating costs and a large local market.

However, few foreign companies move their entire research and development (R&D) efforts to China — partly over fears of discovery theft. Instead, many outsource specific parts of their drug development process.

In this article, Stone and Xin report how Swiss pharmaceutical giant Novartis will break this trend in May 2007 by establishing a US$100 million R&D centre in Shanghai encompassing all stages of drug development.

The move is partly possible because of stricter regulations on intellectual property, says a Novartis spokesperson.

The centre, representing the biggest research investment by any foreign pharmaceutical company in China, will eventually hire 400 local researchers.

Link to full article in Science

Reference: Science 314, 5802 (2006)