China Offers “Cheaper, Better Educated” Labor

Charles River Laboratories’ $1.6 billion acquisition of China’s WuXi PharmaTech positions the preclinical specialist to expand its contract work in drug discovery at a time that Big Pharma companies are consolidating and farming out a larger portion of their early-stage research work. And Charles River CEO makes it clear that the personnel in China who will be joining the company are one of the big attractions.

“For some period of time, there’ll be a wage benefit to using Chinese labor,” CEO James C. Foster tells Boston Globe reporter Robert Weisman. “The labor is plentiful, cheaper, and better educated than in the States. It pains me to say so, but it’s true.”

Charles River has made its mark in the world of drug discovery and animal research breeding animals for pharmaceutical testing. But as Big Pharma streamlines, Charles River should see its role expand. “The reality is that most of our large clients are congealing; they’re taking infrastructure out,” Foster said. “But, the work still has to be done. We’ve reached the point where our internal capabilities exceed those of our clients. They can use us as an adjunct to their own facilities and people.”
Source: Fierce Biotech

See Related Report: Drug Discovery in India and China – Gaining Momentum with Increasing Pressure on Cost Cutting