In her swank headquarters just blocks from some of Mumbai’s worst slums, Swati Piramal is midway through an impassioned pitch about revolutionizing the world of drug discovery, writes BusinessWeek in a look at the outsourcing craze in India. Sanskrit passages of the Bhagavad Gita, the ancient Hindu text that guides her business philosophy, adorn the office walls of her company, Piramal Life Sciences.

Over in Bangalore, Jubilant Biosys laboratories are world-class, but when equipment fails, repairs often take a week, scientist Ajith Kamath explains sheepishly. Lunch is Domino’s pizza with toppings that include corn, Indian paneer cheese, and hot spices. Turns out Jubilant is co-owner of India’s Domino’s franchise, the mag reports, without saying how the pizza tastes.

At first glance, such companies may seem too undeveloped - or perhaps just too culturally remote - to rub shoulders with the world’s top drugmakers. But judging from all the deals taking shape in India, they may have a critical role to play in the industry’s future. In recent months, Western execs have been flocking to India’s hastily built science parks, looking for allies in the never-ending quest to develop blockbuster treatments. With little fanfare, BusinessWeek reminds us, they’ve started a process that could lead to wide-scale outsourcing of drug research to Asia.

The rush east, where five PhD chemists can be had for the cost of one in the West, entails risks. At a time when Pfizer, AstraZeneca, and others are slashing US R&D jobs by the thousands, BusinessWeek correctly notes that the buildup in Asia is bound to set off alarms America is sacrificing another key industry through radical outsourcing. But if the strategy works, it could save pharma billions of dollars, bring down the prices of new drugs, and accelerate breakthroughs.

When Sandeep Gupta, a former Forest Labs research director, toured Indian drugmakers in 2006, he urged ceo’s to import talent fast. “I told them unless they expanded their biology capability, I couldn’t [make deals] with them,” he tells BusinessWeek. Soon, they were snatching up thousands of Indian-born biologists who had trained abroad and offering them leadership opportunities.

Jubilant nabbed Kamath, a 14-year Pfizer veteran, to head its nascent structural biology department, and V.N. Balaji, who had worked at Monsanto and Allergan, as chief scientific officer. The company quickly expanded its team of 50 chemists and drug discovery experts to an army of 700. “If you told me five years ago this would all be here today, I would have replied ‘no way,’ ” Kamath tells the mag.

This is the rest of the story, which does a nice job of reviewing the topic.