Big Pharma Moving More Work Offshore

It wasn't long ago that Merck (MRK Quote), Pfizer(PFE Quote) and other drug giants made it clear that they preferred developing drugs in their own labs, in their own plants and in their own backyards.

"This was an extremely profitable sector and a classically vertically integrated business," says David Finegold, dean of the School of Management and Labor Relations at Rutgers. "The model was working very well."

However, the old model doesn't work as well now due to pressures from generics, the rising costs of creating new drugs and difficulty in producing drugs with tremendous revenue, Finegold adds. ...