AstraZeneca's R&D chief in China lays out $100M strategy

One of the hottest trends in the global R&D business in recent years has been Big Pharma's huge investment in China. Among all the emerging countries, China's massive, fast-growing economy has been a magnet for drug developers determined to tap a whole new market. Steve Yang, AstraZeneca's vice president and head of R&D for Asia and emerging markets, sat down with McKinsey recently to map out the company's research strategy.

The big lesson Yang offers is that AstraZeneca ($AZN) doesn't want to simply replicate the work that it does in the U.S. and Europe. By taking what they know about biomarkers and patient selection, its investigators want to craft a new approach that targets specific disease challenges--such as high rates of gastric and liver cancers--and builds on its tech skills. And to maximize efficiency the company wants to pursue a significant amount of R&D outsourcing as AstraZeneca forges fresh research ties with academic groups as well as biotech companies.

AstraZeneca laid out plans for its $100 million effort back in 2006. And Yang notes that while AstraZeneca has made advances, this is a journey that will take years before anyone sees tangible evidence of new product development.

"We have made great progress and built a solid foundation," says Yang. "But if you use as a measure the time needed to develop a new drug, we still have a long way to go. It takes 10 to 15 years to take an idea all the way from a scientist's hypothesis to products on the market."

As AstraZeneca cuts back on R&D in the West, with another 2,200 research jobs put on the chopping block this week as its profits slide, Yang might want to hurry it up.

- here's the full Q&A with McKinsey