Pfizer and BioNTech: Expanding Business in Brazil - A Case Study

This report delves into the international business expansion of Pfizer and BioNTech, focusing on their strategic partnership with Eurofarma in Brazil for COVID-19 vaccine production and distribution. It examines the company's challenges, including criticisms related to vaccine distribution and revenue. The report analyzes the expansion strategy, utilizing Porter's Diamond model to assess Brazil's attractiveness as a market and discussing regional economic integration. It also covers the Eclectic Paradigm, providing a comprehensive overview of the factors influencing Pfizer and BioNTech's global expansion efforts, and concludes with recommendations based on their experiences.

International Business Expansion Opportunity
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Table of Contents
Introduction................................................................................................................................3
Company Issues.........................................................................................................................3
Expansion Strategy.....................................................................................................................5
Porter’s Diamond Strategy.....................................................................................................6
Regional Economic Integration..............................................................................................8
Eclectic Paradigm...................................................................................................................9
Conclusion and Recommendations..........................................................................................10
References................................................................................................................................11
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Introduction
As markets mature from across world, ever more prospective treasure troves emerge for
expanding firms. International company development is the only way to gain access to such
newest, interesting marketplaces and profit from them. The potential to boost a company's
reputation among a worldwide audience is a fundamental advantage of multinational business
growth. Part of the reason for the (Wright , 2020) most effective organisations' achievement
is that they have established a relationship based on trust with a massive group. This would
not only aid the firm's development, however it would also possible future their business,
ensuring that first consumers will be frequent clients.
“Pfizer” and “BioNTech”, two of the world's most prestigious biopharmaceutical businesses
based company in Germany and the United States, have partnered with Brazil's "Eurofarma"
company to develop their business. “Pfizer” and “BioNTech” will work together to
manufacture the COVID-19 vaccine, primarily inside the United States as well as Europe
(Pfizer.com, 2020), and thereafter expand production infrastructure to meet worldwide
demand. The capability to deliver hundreds of millions of vaccine dosages even by end of
2020 which is depending on the developmental project's technological achievement and
regulatory requirements. Afterwards they will significantly ramp up their production by
reaching to millions and millions of units in early 2021 (Pfizer.com, 2020). Pfizer's wide
knowledge in vaccine discovery and innovation, administrative skills, and worldwide
production and assembly infrastructure will all be put to use in this cooperation.
This research will focus on the hurdles that these two firms faced while developing their
global operations during the epidemic. This will also demonstrate how these businesses used
various growth ideas and models to develop their operations in Brazil. Finally, this report will
present a conclusion as well as suggestions based on the business expansion in the worldwide
market as witnessed in this example.
Company Issues
Leveraging on BioNTech's patented mRNA vaccine technology, the alliance seeks to quickly
move various COVID-19 vaccine prototypes through patient drug trials, with both the goal of
guaranteeing speedy international accessibility towards the vaccine if authorised. The two
businesses aim to undertake clinical studies again for COVID-19 vaccine alternatives in the
United States as well as Europe, starting with various sites in the United States or Europe. If
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governmental approval is received, BioNTech or even Pfizer planned to start the very first
scientific tests by the later part of April 2020 (Pfizer.com, 2020). To understand the obstacles
that both companies have experienced, it is necessary to understand their business
opportunities on a global scale, which necessitates an understanding of their business
structure.
About the Company- Pfizer
The company use research and their worldwide resources to develop medications that help
people live longer and better lives (Pfizer.com, 2020). In the research, discovery, as well as
production of pharmaceuticals products, such as live saving drugs and medicines,
especially novel drugs and vaccines, they seek to establish the benchmark for excellence,
security, and affordability. Day after day, Pfizer employees in established as well as emerging
countries aim to improve health, preventive, therapies, including cures for the world's most
dreaded diseases. The pharmacy company collaborate alongside healthcare (Pfizer.com,
2020) professionals provider companies, authorities, or local governments to promote and
extend accessibility to dependable, decent healthcare across the globe, thus keeping to their
responsibilities as being one of the world's most creative pharmaceutical firms. They have
been working for almost 150 years to create a contribution for those who depend on their
services and product.
About the company- BioNTech
“Biopharmaceutical New Technologies” (BioNTech) is a leader in upcoming
immunotherapeutic treating oncology, inflammatory disorders, including uncommon
conditions. For such fast production of new pharmaceuticals, the business uses a variety of
computationally exploration as well as targeted therapies technologies. “BioNTech” and its
colleagues are researching various mRNA vaccine concepts for a variety of contagious
illnesses, in addition to their varied cancer pathway, depending on their significant
knowledge in mRNA vaccine production as well as in production potentials.
The challenges for expansions
Pfizer has received praise because of its Covid-19 vaccine distribution initiative, however the
company is coming under fire for the size of its earnings as well as the percentage of vaccines
it has given to those poor nations. Pfizer as well as other pharmaceutical companies, keeping
poor countries in the dark, have sold the bulk of dosages to affluent nations. Well after
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partnership, the biotech corporation BioNTech, (Business-standard.com, 2021) revealed in
September 2020 that it would obtain approximately 375 million Euros through the German
government (Business-standard.com, 2021) to endorse vaccine production, Pfizer has been
subjected to heightened criticism on charges of excessive worldwide revenues. In March
2021, drug companies anticipated however by the finish of the last year, 12 billion dosages of
such covid-19 vaccine will have been produced, enough just too fully vaccinate at
approximately 70% of the worldwide people. The “International Federation of
Pharmaceutical Manufacturers and Associations” (IFPMA) has been affirmed this judgment
in September. However, it often cautioned since "majority of dosages (Bmj.com, 2021) in
the manufacturing pipeline have already been assigned" to elevated income nations.
In elevated income nations, distribution is a popular approach. Through the end of last year,
the U.S., the Great Britain, the E.U., (Bmj.com, 2021) as well as Canada might possess 1.2
billion dosages ready for redistributing wealth. According to a Pfizer representative, the firm
plans to distribute one million treatments to low - income nations and intermediate
income nations in 2021, followed by another billion in 2022.
“Pfizer” and “BioNTech” have collaborated with Brazil's “Eurofarma Laboratories”
according to global expansion to produce COVID-19 vaccine dosages (Reuters.com, 2021)
for "Latin America", in such an effort to strengthen both their pharmaceutical firms' position
among Less- income and moderate-income country manufacturers. Effective in 2022,
Eurofarma would eventually produce final doses, marking the first stage in the supply-chain
network development between the two vaccine collaborators in Latin America. The deal does
not include Pfizer's sophisticated “mRNA” ingredient production chain, which will take place
in the United States. At full operating efficiency, “Eurofarma” is planned (Reuters.com,
2021) to generate over than 100 million completed dosages per year.
Expansion Strategy
Global expansion approaches are multi-level essential in designing that organisations utilise
to penetrate a new territory, increase their footprint, and becoming profitability rapidly.
Expansion plans in other countries serve to establish and value increase. Strategic plans
reduce the danger of worldwide growth while also encouraging the most effective use of
personnel, timeframes (Businessjargons.com, 2020), as well as cash. However, according to a
new finding, businesspeople frequently form participatory alliances to deal with market
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uncertainty in overseas markets. Longevity, greater earnings, more status, productivity
improvements, greater market dominance, social advantages, and so on might all be
motivations for the growth. Corporations that have leadership with such a great level of
success and acknowledgment use the growth strategy (Wu et al., 2021). Their goal is to grow,
regardless of the risks or obstacles they should confront.
A nation's beauty may be judged in a variety of ways. As according "Philippe Lassere" (Fang
et al., 2018), a nation is desirable while there are economic and business prospects as well as
the hazards to investors and customers are tolerable. These are all the two basic arguments
that may be employed as beauty rationale. The prospective consumption as well as how
simple it is to fight in the nation are used to assess economic and business prospects. Brazil's
domestic need for growth is enormous. Many aspects (Neves et al., 2020) must be examined
when evaluating a nation's desirability: population as well as development, assets,
opportunities, and hazards. Marketing and corporate rivalry are crucial criteria for
corporations engaged in FDI in terms of market size.
Porter’s Diamond Strategy
Figure 1: Porter’s Diamond Model
The “Diamond of National Advantage” is made up of four features that may be evaluated
separately or even as a framework to determine a nation's advantages and how much it sets
up the competition and operates in its businesses. Later in Porter's study, the terms
"Administration" and "Opportunity" (Vidjak, 2019) were addressed. The administration
performs a critical role in ensuring that companies have the proper circumstances and
incentives to reach better levels of good advantage. It is in charge of making choices about
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Company
Strategy, Rivalry
and Structure
Demand
Condition
s
Factor
Conditions
Related and
Supporting
Industries

laws, corporate business practises, and financial infrastructure. Porter's four characteristics
are:
Factor Conditions
These include production-related factors like facilities and specialised human capital. Factor
circumstances are mostly influenced by nations rather than the natural surroundings. Brazil's
globally competitive businesses revolve primarily in its environmental assets, which are
linked to the country's weather, land, overall beauty. In context of general financing,
university education obtains greater emphasis than that of primary school, however it is not
affordable to all. In Brazil, state schools are provided free. A policy of ethnic and
socioeconomic classifications was established by the administration. This initiative intends to
set aside a proportion of university seats for children who have attended public schools (Park
and Ungson, 2019), focus on low households, or who identify as black, combined race, or
indigenous.
Demand conditions
The domestic industry's services and product needs are known as demand conditions. The
way corporations acquire, analyse, and react to customer wants is shaped by the requirement
for residences. Following the implementation of several social programmes aimed at reducing
poverty as well as economic disparity (Fernando, 2021), a new type of customer has emerged
in this country. The development in average earnings and standard of living is due to a
variety of factors other than aid programmes. Wages have stabilised as a result of the
significant modifications brought in the Brazilian economic condition, the management of
volatility, and expenditures inside the domestic marketplace.
Related and Supporting Industries
Connected and accompanying businesses indicate the presence or lack of globally competing
providers and associated sectors. The vast dimensions and (Fernando, 2021) high shipping
costs readily justify this. Local authorities as well as administrations frequently provide tax
breaks and additional advantages to businesses in order to help them grow the community as
well as produce jobs.
Company Strategy, Rivalry and Structure
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Business strategies, design, and competition are regional trends in how corporations are
formed, structured, and governed in the nation, as well as how internal competition is fought.
Technical innovativeness component of a company’s competitiveness, as it helps
corporations to generate more revenue by differentiating their products. It has been used to
create a paradigm of Brazilian businesses (Park and Ungson, 2019),, dividing them into two
categories: those that develop and distinguish goods (Fernando, 2021), and those who
compete on brand uniqueness. Brazilian businesses have evolved a unique aptitude to manage
with crises. However, in the face of adversity, they produce value. Along with its size,
diversity of culture, as well as natural beauty, Brazil possesses the characteristics of a nation
continent.
Regional Economic Integration
Regional economic integration has allowed nations to concentrate on topics that are important
to their phase of establishment while also encouraging commerce among neighbours.
Free trade area
Member countries remove all barriers to trade between themselves but are free to
independently determine trade policies with non-member nations. With the ratification of the
North American Free Trade Agreement (NAFTA) (Bartošková , 2020) among Mexico, US
and Canada in 1993, it was inevitable that Brazilian participation in even larger regional trade
arrangements than Mercosur (Albertoni and Smitmans, 2019) would be discussed
increasingly.
Customs union
As in a free-trade agreement, this style promotes socioeconomic interdependence. Trade
restrictions amongst member nations are abolished. The “Brazil-Argentina Act” (Toledo ,
2019) of Integrate formed the Programme of Integrating and Economic Ties, with the purpose
of creating a single financial environment by strategic market access.
Common market
This form of agreement permits participating countries to create financially interconnected
marketplaces. Whatever, trading faces obstacles (Toledo, 2019), as well as limitations on the
circulation of workers and employers amongst participating nations, are eliminated. With
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both the restoration of European cooperation, the development of something like the
Common Market of the Southern (Mercosur) (Albertoni and Smitmans, 2019), as well as the
NAFTA, regional integration or regional development became distinguishing characteristics
of the post 1989 period (Bartošková , 2020).
Economic union
Whenever nations participate into such an economic treaty to abolish trade restrictions and
embrace similar economic principles, this kind is produced. (Meissner, 2018) Numerous
additional sections of the treaty slant the agreement in favour of increased economic freedom.
Tax decreases are calculated using the tariffs in effect prior to the various treaties signature.
Eclectic Paradigm
The eclectic paradigm is an economical as well as commercial strategy for assessing the
desirability of establishing a "Foreign Direct Investment" (FDI) that is founded on
famous economist J.H Dunning's internalisation thesis (Dygas, 2020). The eclectic model
follows this same OLI paradigm. “Ownership”, “location”, and “internalisation” are the three
stages of the structure.
Advantages of Ownership
The first factor to evaluate is ownership benefits, which include private knowledge including
an industry's numerous ownership and control. Horizontally FDI (Wagner, 2020) is
characterized as capital invested outside of the country that are targeted at producing the
same or comparable items as those sold in the domestic market. This type of investments are
typically made by companies with a strong presence in their own nation as well as a property
benefit, including a copyright or a well-known brand.
Advantages of Location
The second required quality is a favourable location. Organizations must determine if
conducting specific tasks within a single country provides a competitive edge. United States
subsidiaries have been less efficient respective to their parent businesses, although higher
effective than the UK affiliations, implying that perhaps the greater American performance
can indeed be partially explained through business variables which aren't transferrable.
Advantages of Internalisation
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Finally, internalisation benefits indicate when it is advantageous for a company to develop a
goods in-house rather than outsourcing through a third company. It would be relatively
expense for a company to function from a separate marketplace area while continuing to
execute the job in at periods. Brazil (Ardito et al., 2020) as well as neighbouring Latin
American nations provided a diverse variety of investing options to affluent advanced nations
seeing a boom of cash as a result of OPEC wealth getting put in western financial institutions.
Conclusion and Recommendations
According to these pharmaceutical and biotech businesses, the aforementioned models helped
them break into the worldwide market during the COVID-19 viral outbreak. Eurofarma in
Brazil was an ideal investment location for nations such as the United States and Germany.
All of the models and theories connected to company development revealed that all of the
model's characteristics had given “Pfizer” and “BioNTech” a compelling reason to engage
with Brazil's industry. Furthermore, the theories and models discussed in this research
provide a clear picture of market development in other nations as well as chances for foreign
direct investment in the near future for any other specific enterprises.
It is suggested that, during the COVID-19 vaccination crisis in low- and middle-income
nations, this corporation demonstrate its compassion rather than its economic acumen. The
big pharmaceutical corporations, on the other hand, have teamed together to service those
low- and middle-income nations presently. However, any firm should adopt all of these
models and ideas while penetrating the global marketplace, according to the business growth
plan. This study also includes advice such as expanding a firm into a foreign market and FDI
as an important topic for an organization's growth and long-term viability. However, such
firms may encounter certain challenges while entering the new market, which will be
examined in future studies.
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