WuXi PharmaTech, a provider of R&D outsourcing services, has agreed to pay $151 million for Minnesota-based medical research group Apptec. WuXi gains Apptec's biologics capabilities along with U.S. market presence.
Analysts aren't so wild about the move. WuXi's success is due to the fact that scientists in China are paid about $30,000 a year--a fraction of the going rate for U.S. scientists, who can make ten times as much. WuXi provides low cost R&D to pharmaceutical companies looking to cut some cash out of the bottom line. Acquiring a U.S.-based asset--along with its highly-paid scientists--could have quite an impact on that business model.