International Business 10th Edition by Charles Hill

Exercise 4

A small Canadian firm that has developed some valuable new medical products using its unique biotechnology know-how is trying to decide how best to serve the European Union market. Its choices are given below. The cost of investment in manufacturing facilities will be a major one for the Canadian firm, but it is not outside its reach. If these are the firm's only options, which one would you advise it to choose Why
• Manufacture the product at home and let foreign sales agents handle marketing.
• Manufacture the products at home and set up a wholly owned subsidiary in Europe to handle marketing.
• Enter into an alliance with a large European pharmaceutical firm. The product would be manufactured in Europe by the 50 50 joint venture and marketed by the European firm.