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Pharma Heal Corporation was founded in 1995 by Akosua Sowa
and Isabella Suarez, two PhD program classmates at a world-
renowned technology institution. In their graduate program,
Akosua and Isabella researched methods for getting HIV-
treating drugs manufactured, distributed, and properly
administered in developing world nations. They collaborated
intensely on these projects. After receiving their PhD degrees,
Akosua and Isabella decided to translate that research and their
deep personal commitments into a business enterprise. Akosua
and Isabella approached public health officials and prominent
business leaders in their home countries of South Africa and
Mexico. With their advice and financial support, they founded
Pharma Heal Corporation to realize the practical application of
their research to saving lives in developing world nations.
The President and Chief Executive Officer (CEO) of Pharma
Heal Corporation is Akousa; the Chief Financial Officer (CFO)
and Director of Technologies of Pharma Heal Corporation is
Isabella. They both hold seats on the board of directors, a board
which is comprised of an array of leading figures in
international medical technology and public health.
Akosua and Isabella have devised a three-part business plan for
Pharma Heal Corporation:
1. Partner with pharmaceutical manufacturers located in the
developing world to manufacture lower cost drugs for treating
HIV and working toward an HIV vaccine.
2. Establish key distribution channels in each developing world
country to make the lower costing HIV treatments available
efficiently and economically to those in each country needing
treatment.
3. In each developing world country, partner with indigenous
healthcare personnel as well as representatives of international,
religious, and charitable organizations that support medical
personnel.
Akosua and Isabella have retained you as their international
business consultant to advise them about the growth of their
business to achieve these three ambitious goals. They are aware
of the many legal regimes and diversity of legal cultures in
countries of the developing world where they aspire to achieve
their three-part business plan. They are particularly impressed
by your business education and are counting on you to give
them excellent business advice and provide troubleshooting.
Assignment
The government of Sustainia, a developing world country,
approached Pharma Heal Corporation about leasing to the
company a concession to run pediatric HIV clinics throughout
the cities of Sustainia. Akosua and Isabella signed an agreement
with Sustainia’s minister of health, granting the concession and
containing a stabilization covenant by which both parties agreed
that the agreement could not be altered except by their mutual
concurrence.
Shortly thereafter, Pharma Heal Corporation established a
separate subsidiary company, Pharma Heal-Sustainia, to conduct
the business of building, hiring for, and managing the pediatric
HIV clinics. Pharma Heal-Sustainia accomplished these tasks
very quickly and efficiently, establishing an excellent and
effective network of clinics. However, a coup d’etat occurred,
installing a fundamentalist theocratic government. The
theocratic government condemned any effort to treat HIV
sufferers, insisting that HIV was a heaven-sent plague upon
earthly demons, and the righteous must refuse to intervene. The
theocratic government had the military take over Pharma Heal-
Sustainia’s clinics. Medical clinics of other countries, primarily
countries that are members of the Red Crescent, were allowed to
continue to operate—provided that they did not treat HIV-
caused conditions. At the same time, the Sustainia court system
was “suspended,” leaving no place for Pharma Heal Corporation
to apply for reparations or compensation. Before Pharma Heal-
Sustainia personnel could vacate the clinic in Sustain City (the
country’s capital), students from a local university who
supported the theocratic government captured, gutted, and
burned the clinic, destroying hundreds of thousands of dollars
in medical equipment and severely injuring half a dozen Pharma
Heal-Sustainia doctors and nurses.
The minister of health has informally stated to Akosua that he is
willing to move the government to provide some compensation.
However, the minister has agreed to do so only if Akosua pays
him a US$500,000 bribe for his intervention with the theocratic
government.
Assume that Sustania is a party to an international arbitration
treaty that requires the government to arbitrate claims filed
against it.
Akosua seeks a memorandum from you to the board of directors
that outlines your evaluation of the following issues:
Part 1: Is going to arbitration with the Sustainia government
over the seizure of its clinics worthwhile? What are the odds of
Pharma Heal Corporation prevailing?
Part 2: Should Pharma Heal Corporation file additional
compensation claims with the arbitral tribunal to seek recovery
for the equipment losses and the employees’ personal injuries
caused by the local university students?
Part 3: Is a better course to obtain some compensation without
legal proceedings by paying the minister of health the money he
has demanded to act as an emissary to the theocratic
government?

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  • 1. APA style 3pages Pharma Heal Corporation was founded in 1995 by Akosua Sowa and Isabella Suarez, two PhD program classmates at a world- renowned technology institution. In their graduate program, Akosua and Isabella researched methods for getting HIV- treating drugs manufactured, distributed, and properly administered in developing world nations. They collaborated intensely on these projects. After receiving their PhD degrees, Akosua and Isabella decided to translate that research and their deep personal commitments into a business enterprise. Akosua and Isabella approached public health officials and prominent business leaders in their home countries of South Africa and Mexico. With their advice and financial support, they founded Pharma Heal Corporation to realize the practical application of their research to saving lives in developing world nations. The President and Chief Executive Officer (CEO) of Pharma Heal Corporation is Akousa; the Chief Financial Officer (CFO) and Director of Technologies of Pharma Heal Corporation is Isabella. They both hold seats on the board of directors, a board which is comprised of an array of leading figures in international medical technology and public health. Akosua and Isabella have devised a three-part business plan for Pharma Heal Corporation: 1. Partner with pharmaceutical manufacturers located in the developing world to manufacture lower cost drugs for treating HIV and working toward an HIV vaccine. 2. Establish key distribution channels in each developing world country to make the lower costing HIV treatments available efficiently and economically to those in each country needing treatment. 3. In each developing world country, partner with indigenous healthcare personnel as well as representatives of international, religious, and charitable organizations that support medical
  • 2. personnel. Akosua and Isabella have retained you as their international business consultant to advise them about the growth of their business to achieve these three ambitious goals. They are aware of the many legal regimes and diversity of legal cultures in countries of the developing world where they aspire to achieve their three-part business plan. They are particularly impressed by your business education and are counting on you to give them excellent business advice and provide troubleshooting. Assignment The government of Sustainia, a developing world country, approached Pharma Heal Corporation about leasing to the company a concession to run pediatric HIV clinics throughout the cities of Sustainia. Akosua and Isabella signed an agreement with Sustainia’s minister of health, granting the concession and containing a stabilization covenant by which both parties agreed that the agreement could not be altered except by their mutual concurrence. Shortly thereafter, Pharma Heal Corporation established a separate subsidiary company, Pharma Heal-Sustainia, to conduct the business of building, hiring for, and managing the pediatric HIV clinics. Pharma Heal-Sustainia accomplished these tasks very quickly and efficiently, establishing an excellent and effective network of clinics. However, a coup d’etat occurred, installing a fundamentalist theocratic government. The theocratic government condemned any effort to treat HIV sufferers, insisting that HIV was a heaven-sent plague upon earthly demons, and the righteous must refuse to intervene. The theocratic government had the military take over Pharma Heal- Sustainia’s clinics. Medical clinics of other countries, primarily countries that are members of the Red Crescent, were allowed to continue to operate—provided that they did not treat HIV- caused conditions. At the same time, the Sustainia court system was “suspended,” leaving no place for Pharma Heal Corporation to apply for reparations or compensation. Before Pharma Heal- Sustainia personnel could vacate the clinic in Sustain City (the
  • 3. country’s capital), students from a local university who supported the theocratic government captured, gutted, and burned the clinic, destroying hundreds of thousands of dollars in medical equipment and severely injuring half a dozen Pharma Heal-Sustainia doctors and nurses. The minister of health has informally stated to Akosua that he is willing to move the government to provide some compensation. However, the minister has agreed to do so only if Akosua pays him a US$500,000 bribe for his intervention with the theocratic government. Assume that Sustania is a party to an international arbitration treaty that requires the government to arbitrate claims filed against it. Akosua seeks a memorandum from you to the board of directors that outlines your evaluation of the following issues: Part 1: Is going to arbitration with the Sustainia government over the seizure of its clinics worthwhile? What are the odds of Pharma Heal Corporation prevailing? Part 2: Should Pharma Heal Corporation file additional compensation claims with the arbitral tribunal to seek recovery for the equipment losses and the employees’ personal injuries caused by the local university students? Part 3: Is a better course to obtain some compensation without legal proceedings by paying the minister of health the money he has demanded to act as an emissary to the theocratic government?