A small Canadian firm that has developed 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?


a. Manufacture the products at home, and let foreign sales agents handle




b. Manufacture the products at home, and set up a wholly owned


subsidiary in Europe to handle marketing.


c. Enter into an alliance with a large European pharmaceutical firm. The


products would be manufactured in Europe by the 50–50 joint venture


and marketed by the European firm.