Introduction:

The opportunities available in international markets have increased tenfold in recent years with the opening of business prospects in different markets such as China, Europe, and the Middle East. The prospects for leveraging opportunities for exports, investment, partnership, and sourcing in international markets have become prominent in the contemporary domain of business management. The references towards developing opportunities for introducing cost-effective and competent product offerings alongside effective marketing of services and products and entering into collaborative agreements with partners in foreign countries. The cost of product development and service delivery in the pharmaceutical industry could be assumed as a formidable barrier for the existing companies to obtain credible opportunities in international markets (Cavusgil et al., 2014).

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The particular indications towards the case of a partnership between Pfizer Inc. and Chinese pharmaceutical company Zhejiang Hisun Pharmaceuticals and the role of external issues and trends that affect the business partnership as well as the desired internal benefits and integration between both companies. The report also aims at the critical reflection on the theoretical perspectives for defining the potential impact of national and corporate cultures on the business partnership and drawing an impression of the potential effects of the exchange rate fluctuations involved in the partnership. It is also essential to highlight the possible challenges in international business to obtain a credible impression of their impacts on the future of international business as well as opportunities in the future employment prospects sought by students in international business management.

External issues and trends:

The globalization observed profoundly in business activities could be associated with the formal integration of national and regional cultures, societies, and economies through leveraging the benefits from the worldwide network for communication, trade, transportation, and immigration. The transition of the primary focus of globalization from the economic perspective towards diverse aspects such as technology, politics, media, and culture can be observed as one of the profound trends influencing the business partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals.

The joint venture was announced in 2012 to ensure collaboration in the development, manufacturing, and commercialization of off-patent pharmaceutical products in global markets as well as China. The capital investment of $295 million alongside a registered capital amounting up to $250 million in the partnership could be considered a major highlight of the partnership (Hamilton & Webster, 2015). Furthermore, it is essential to observe the requirement for partnerships in diverse disciplines associated with the domain of pharmaceutical products such as cardiovascular diseases, oncology, mental health, infectious disease, and other significant therapeutic areas. One of the notable trends that have been impactful on the performance of the business partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals is the stupendous growth trends in the Chinese pharmaceutical market.

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As per Westendorp & Wewer, the market share for branded generic medicines is estimated to be 70% of the domestic pharmaceutical market and the variable dimensions related to market globalization can be considered viable opportunities for ensuring feasible outcomes from the business partnership (Westendorp & Wewer, 2017). The firm-level consequences associated with market globalization include the outcomes derived from the internationalization of the value chain of an organization. The notable external issues that can be identified in this case include competition and intensive rivalry from local competitors, and increasing demands of buyers that depend on the sourcing from global suppliers. The internationalization process should also be accompanied by proactive qualities that can be perceived as a significant threat to the value chain of the organization.

The particular drivers also include the adoption of free trade in China which can be accounted as a major trend influencing the business partnership outcome. The technological development could account for the outcomes in terms of societal consequences such as the impact on the poorer sections of society, the impact of national culture, and concerns about the loss of national sovereignty. The internal benefits that could be gained by both the parties from the partnership include the prominent outcomes in the form of research and development as well as the exchange of talent related to pharmaceutical production, development, and marketing (Chen et al., 2015). The impact of the partnership could also be identified in the recognition of synergy between the organizations in terms of procurement, manufacturing, marketing, and distribution aspects that would be largely based on the exchange of information resources. The exchange of information can also be accounted for the identification of opportunities for integration of both organizations to ensure the sourcing of raw materials from a global supply chain facilitated by Pfizer Inc. that can be coordinated with the manufacturing privileges that can be facilitated by Zhejiang Hisun Pharmaceuticals in the form of establishments for manufacturing as well as research and development (Griffin et al., 2015). The involvement of the US and Chinese governments in the context of the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals could be accounted as promising influences for monitoring the optimal utilization of national resources alongside the provision of equitable benefits for both companies in the partnership.

The involvement of the US government could be validated explicitly on the grounds of interests for the protection of the national economy. However, the involvement of the Chinese government could be considered as the outcome of concerns for the preservation of national strategic priorities, improving employment opportunities, and national culture and identity. Some of the particular outcomes could be observed in the examples of FDI ownership restrictions and government regulations (Griffin et al., 2015). Government regulations regarding industry safety, labeling requirements, technology standards, and health regulations could be identified from the particular references towards the involvement of both governments. The particular implications of developing currency control standards could also be considered major implications for changing the outcomes that can be derived from the partnership.

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Partnership in the pharmaceutical industry:

The productive outcomes that can be derived from the literature on business partnerships are reflective of the comprehensive history of alliances. Furthermore, the increased emphasis of the firms on competition as well as cooperation between organizations could be accounted as a formidable trend that emerged around 1950 and has been stated in the research studies presented by a notable researcher in the domain of multinational business operations, Dunning. The competitive advantage of an industry could be improved and characterized by sustainability through the promotion of productive alliances and collaborations between noticeable players in domestic as well as international pharmaceutical markets.

The emphasis on strategic alliances has to be observed comprehensively in the case of the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals thereby implying a contrasting deviation from the conventional approaches for collaboration (Hamilton & Webster, 2015). The examples of the different forms of collaboration that can be perceived in the case of the two companies under concern in the context of this case study include references towards minority participation, cross-distribution, supply purchasing, cross-licensing arrangements, and partnerships in marketing, and other areas. The literature sources that can be utilized for reviewing the nature of the partnership can be identified in the form of explicit global trends in strategic alliance, factors influencing the development of strategic analysis, influence of the strategic collaborations on the different aspects of the business, and the critical success factors perceived in the case of strategic alliances.

First of all, the research findings of Kesic indicate the increasing prominence of globalization and competitiveness in the global pharmaceutical industry characterized largely by the increased costs for the development of new medications. Therefore the particular references towards the adoption of a strategic approach that is related to the promotion of rapid concentration and consolidation of the global pharmaceutical industry could be identified clearly as a trend. Therefore the success of a pharmaceutical company could be largely attributed to the effectiveness of research and development alongside prominent involvement in the activities related to sales and marketing.

The theory presented by porter reflects on the opportunities to realize competitive advantage through the value created by firms for buyers and the cost of creating the value. Literature has also emphasized the significance of opportunity assessment through a comprehensive impression of the organization’s capability to adopt international business activities, suitability of the products and services in international markets, refining choices for selecting countries to identify particular target markets, and select qualified business partners. The risks identified with the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals could be explicitly vested in the concerns of control since the latter has a major share of 51% in the partnership thereby implying a higher level of control. Another influential risk that can be identified in the case of this partnership is the lack of coordination on the approaches for estimation of the sales potential of an organization in the foreign market.

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As per Westendorp & Wewer, the foreign partner should also depict formal indications towards the provision of complementing resources and complementary partnerships (Westendorp & Wewer, 2017). On a general basis, the disparities in cross-cultural communications and variation of national as well as corporate culture are assumed as prominent pitfalls for the partnership. The subsequent consequences that can be associated with the partnership include references to the loss of autonomy and differences in terms of operating policies of individual organizations. As compared to this partnership, the alliance of Pfizer with Hospira, a US-based pharmaceutical manufacturer, and subsequent acquisition can be considered a feasible venture as it did not imply any particular concerns for addressing national culture and the requirement of complementary expertise. The control implications were also subject to regulations by a single government thereby implying the minimal presence of risks in the context of the partnership.

National and corporate culture:

One of the foremost risks in international business is identified in the form of cross-cultural risks that emerge from the disparities between two distinct national cultures. The key concepts related to national culture involve socialization and acculturation which are responsible for determining the extent of cross-cultural risk implying that disparities in communication between different cultures could lead to detriments for human value. Socialization is an important element that has a procedural implication in the context of national culture that is reflective of the adaptability of an individual towards learning the behavioral patterns that are related to a specific society (Chen et al., 2015).

The acculturation aspects in national culture reflect on adjustment competencies with other cultures that are generally identified in the case of expatriate employees. The concerns of corporate culture are also associated with national culture and are influenced to a certain extent that can be identified through the application of Hofstede’s model of national culture. The comparison of the two concerned countries China and the United States is associated profoundly with the notable disparities in terms of individualism and power distance index. The findings from the different indices about the illustration of national culture could be associated as a credible influence on the determination of the impact of national and corporate culture on the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals.

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The individualism aspect is higher in the case of the US while China could be assumed with collectivist ideologies for defining social roles. Furthermore, it is essential to consider the fact that the role of the power distance index is also perceived as a notable influence on the business outcomes that can be derived from the partnership. The power distance index is minimal in the case of the United States whereas the score of the power distance index in the case of China is identified to be a major indicator of the demarcation of authorities and responsibilities and the perception of large-scale inequality existing between different hierarchical levels within the society. The references to corporate culture can be defined through explicit references towards effective management of employees, negotiation, and structuring of business ventures, development of products and services, interactions with existing and potential customers, and the communication and dealing of the organization with distributors and other significant business partners (Griffin et al., 2015). The corporate culture is also reflective of the measures for advertisement and promotion. Uncertainty avoidance is also a significant dimension in the national culture of a country which could define the extent of the development of resilience towards risk and the uncertainties in the lives of individuals.

The case of uncertainty avoidance is highly observed in the regimented arrangement of regulations that can be reflective of an organization’s capabilities to ensure appropriate career options alongside effective monitoring of the actions of workers. The societies which are characterized by minimal uncertainty avoidance reflect on the relatively entrepreneurial nature of managers and their flexibility in handling situations of risk. The low uncertainty avoidance societies are known for taking risks to ensure the swift execution of business decisions. Masculinity is observed on similar grounds in the case of both countries implying a credible emphasis on the focus of individuals on accomplishments (Griffin et al., 2015). The long-term orientation also demarcates the national cultures of the US and China as the latter is favorable for long-term orientation that is directed towards the essential elements of planned living and focuses on long-term commitments. The short-term orientation identified in the case of the United States could be identified in the inclinations of the society members towards accomplishing short-term goals. The impact of these dimensions of national culture as highlighted by Hofstede reflect profoundly on the necessity for an ethnocentric, geocentric, and polycentric orientation derived from the inferences regarding the dimensions of national culture and the influence of sector precedents. In the case of the pharmaceutical industry both the organizations have a credible set of competencies that could be leveraged for providing prolific outcomes for the partnership.

Exchange rate movements:

The particular implications presented in the research study literature are also reflective of the major effects of exchange rate fluctuations on international trade. The particular references to the specific dimensions observed in the case of exchange rate fluctuations suggest the effect of financial crises on exports and the determination of measures for exchange rate volatility. The results are also directed towards the explanation of the significance of exchange rate volatility in the promotion of opportunities for export volumes. Chili & Nguyen said that this factor could have a formidable impact on the partnership of Pfizer Inc. and Zhejiang Hisun Pharmaceuticals since the global value chain of the former could be subject to major insufficiencies in terms of restrictions on the export volumes (Chkili & Nguyen, 2014). The short-term impacts of bilateral exchange rate volatility could also be perceived as notable impacts of the movements in the exchange rate on the partnership. The increasing prominence of foreign currency and its circulation within the economic framework of a nation has created noticeable concerns about the alterations in the values of exports and imports due to the movements in the exchange rate.

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The appreciation of currency against the other currencies could be associated with the particular references toward limited requirements for cheaper import prices. On the contrary, the appreciation of the exchange rates could also lead to minimal opportunities for the US to obtain the finished products at lower prices. This factor could be accounted as a noticeable effect on the business performance of the partnership. Theoretical references to the standard theory of international trade can be accounted as promising initiatives for determining essential insights into a flexible approach in which the existing movements of exchange rate can be adjusted (Manalo, Perera & Rees, 2015). The reflection on standard trade theory could be assumed to relate the merchandize and the exchange rate fluctuation. Furthermore, the notable opportunities that can be identified in the context of the exchange rate movements reflect primarily on the value and volume of trade and the implications for corruption in event of changes in the currency exchange rate. Prominent implications of hedging could also be identified in the case of exchange rate movements that can moderate the effects of the financial privileges of individual parties in the partnership.

Challenges of international business:

The challenges which are identified in the case of international business are observed in terms of consistency in strategies to improve production efficiencies, developing a culture of learning, and the cultural distance. An understanding of these factors is necessary concerning the implementation of measures for the long-term outcomes in the domain of international business. As per Cavusgil et al, The critical review of these aspects and the approaches in which they impose considerable impact on the opportunities for the development of personal competence should be helpful to engage in international business activity management effectively in the future. It is also essential to focus on the crucial nature of cultural distance and the underlying factors involved with it that can imply a negative impact on strategic collaborations in international business (Cavusgil et al., 2014). The cultural distance is strengthened on the grounds of disparities in languages, religion, and in terms of norms, dispositions, and values. Furthermore, the cultural distance is widened based on factors such as preservation of national cultural identity and siding with traditionalism which could also be associated explicitly with the adherence of society to conventional norms for monitoring the coexistence of diverse communities.

The depreciation of trust in the case of cultural distance could be assumed as a credible outcome from the risk to the performance of business partnerships in international markets. The particular references to the risk of sustainability in international businesses could also be assumed as a potential risk that can affect the potential performance of business collaboration since conflicts of interest are commonly observed as reasons for splitting up partnerships.

The large-scale effects are profoundly observed in the case of production activities which are becoming sophisticated with every passing day due to the large-scale technological advancements. Furthermore, it is also essential to observe the impact of learning culture on the future of international business can be accounted as a major risk factor. The risk factor could be perceived explicitly due to the necessity for learning on the grounds of apprehension of businesses to learn from competitors in international markets as well as realize the scope for opportunities to exchange information resources as well as cope with the requirements of diversification. With globalization and diversification in the fray, the domain of international business is considerably influenced by the acquisition of a diverse workforce that can facilitate opportunities for access to talent and a competent workforce. Therefore these factors could be identified in the effective realization of international businesses.

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Conclusion:

The report explored the teaching materials provided in the seminars and course schedule to reflect on the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals. The essential highlights of the report include references to external trends and issues, key internal benefits, government intervention, risks related to a strategic partnership, and the impact of national and corporate culture on the partnership between Pfizer Inc. and Zhejiang Hisun Pharmaceuticals. Other profound highlights that are identified in the case of the report include the identification of specific challenges in international business and the impact of exchange rate movements on the partnership.