The CEO of San Jose-based Sage-N has a good answer to that question. I find the order interesting.
Drug Discovery News: Informatics
Why China? Simple, Chiang says: Market, talent and cost — in that order of importance.
He also notes (with my emphasis):
Chiang plans to roughly double the size of Sage-N with the expansion
into China, and expects staffing to be about evenly split between
Silicon Valley and Shanghai, at first. In the long run, though, Chiang
thinks having close to 80 percent of staff in China and around 20
percent in the United States—with a smattering of people in Europe—is
the best mix for the company.