India and Russia trailed China in the poll, with Brazil and Czech Republic following closely behind.
Clinical trials account for two thirds of the development cost for new drugs and offshoring to locations outside the US is becoming a common way to help pharma firms keep costs down by providing access to a new range of patients, aiding recruitment.
Other factors such as cheaper labour and site fees also often help.
As a result, in 2005 almost half of the 1200 clinical trials conducted by the 12 largest US pharmaceutical companies included an offshore location, according to an analysis by consulting firm A.T. Kearney of data voluntarily submitted to the US government by pharma companies.
As part of the analysis, A.T. Kearney also compiled "The country attractiveness index for clinical trials" - a list of the 15 most popular offshore locations.
What may be a surprise is that China, despite its bureaucracy, government red tape and questions over intellectual property, has stolen the top spot from India who is seemingly more active in this arena and more in tune to the needs of the West.
According to the report, China was chosen because it has the largest urban patient population in the world - providing a vast patient pool - in addition to a huge network of hospitals with over 2.5m doctors, nurses and technicians, all on significantly lower salaries than their western counterparts.
Due largely to this, conducting a trial in China could cost half of that in the US, said the report, titled: "Make Your Move: Taking Clinical Trials to the Best Location."
India features next behind China in the popularity stakes, offering similar advantages.
The governments of both countries are also actively trying to encourage new clinical activity from foreign firms, introducing a series of new regulations and improving existing ones in order to simplify and streamline the clinical trials process.
Meanwhile, Russia took third spot, again, the appeal being its low-cost nature and its large available patient pool, many of whom are treatment naive.
In addition, the Russian hospital system treats all patients who have similar symptoms on the same ward, further assisting the recruitment process, said the report.
"Such factors allow patients to be recruited up to ten times as fast as in the US."
Data for the analysis was derived from both primary and secondary sources, including research with top pharmaceutical executives and data from organisations including The World Health Organisation.
Five key areas were evaluated during the decision-making process - patient availability, cost-efficiency, expertise, regulatory conditions and infrastructure.