Innovative drugs are the lifeblood of pharmaceutical companies, but the cost of developing them is rising to unsustainable levels. Pharma executives are already saying that as the economy falters, they foresee bleak prospects and mergers unless their companies get more innovative drugs into their pipelines. The clock is ticking on the race to increase productivity, as key patents worth a projected $30 billion in revenue will expire between 2010 and 2013, opening the floodgates to competition from generics, according to Barbara Ryan, an analyst at Deutsche Bank. This imperative is propelling increased outsourcing of R&D operations as companies trim overcapacity. more