m Exam Case Study

BECG$\_$Mid Term Exam$\_$Case Study

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BusinessEthics&CorporateGovernancePLASMAINTERNATIONALTheSundayheadlineintheTampa,Florida,newspaperread:$$BloodSalesResultinExorbitantProfitsforLocalFirm$.$ThestorywentontorelatehowthePlasmaInternationalCompany$,$headquarteredinTampa,Florida,purchasedbloodinunderdevelopedcountriesforaslittleas$15$centsapintandresoldthebloodtohospitalsintheUnitedStatesandSouthAmerica.ArecentdisasterinNicaraguaproducedscoresofinjuredpersonsandtheneedforfreshblood.PlasmaInternationalhad$10,000$pintsofbloodflowntoNicaraguafromWestAfricaandchargedthehospitals$$25$perpintnettingthefirmnearlyaquarterofamilliondollars.Asaresultofthenewspaperstory,agroupofiratecitizens,ledbyprominentcivicleaders,demandedthattheCityofTampa,andtheStateofFlorida,revokePlasmaInternational$$slicensestopracticebusiness$.$OthersprotestedtotheirCongressmentoseekenactmentoflegislationdesignedtohaltthesaleofbloodforprofit.Thespokespersonwasreportedassaying,$$Whatkindofpeoplearethese$$sellinglifeanddeath$?$Thesemenpreyontheneedsofdyingpeople,buyingbloodfrompoor,ignorantAfricansfor$15$centsworthofbeadsandjunk,andsellingittoinjuredpeoplefor$$25$apint.Well,thiscompanywillsoonfindoutthatthepeopleofourcommunitywon$$tstandfortheirkindaroundhere$.$Ijustdon$$tunderstandit$.$Werunabusinessjustlikeanyotherbusiness;wepaytaxesandwetrytomakeanhonestprofit,$$saidSolLevinasherespondedtoreportersattheTampaInternationalAirport$.$HehadjustreturnedhomefromtestifyingbeforetheHouseSub$-$CommitteeonMedicalStandards.Therecentpublicitysurroundinghisfirm$$sactivitiesduringtherecentearthquakeshadonceagainfannedtheflamesofpublicopinion$.$Anelectionyearwasanunfortunatetimeforthepublicitytooccur.Thepoliticiansandthemediawerehavingafieldday.LevinwasasuccessfulstockbrokerwhenhefoundedPlasmaInternationalCompanythreeyearsago.Recognizingtheworldneedforsafe,uncontaminatedandreasonablypricedwholebloodandbloodplasma,Levinandseveralofhiscolleaguespooledtheirresourcesandwentintobusiness.Initially,mostofthebloodandplasmatheysoldwerepurchasedthroughstorefrontoperationsinthesoutheastUnitedStates.Mostofthedonorswere,unfortunately,menandwomenwhousedthemoneyobtainedfromthesaleoftheirbloodtopurchasewine.Whilesalesincreaseddramaticallyonthebasisofaninnovativemarketingapproach,severalcasesofhepatitiswerereportedinrecipients.Thecompanywiselybeganasearchfornewsources.Recognizingtheirownlimitationsinthemedical$-$biologicalsideofthebusiness,theyrecruitedahighlyqualifiedteamofmedicalconsultants.Theconsultingteam,afterextensivetesting,andaworldwidesearch,recommendedthatthebloodprofilesanddonorcharacteristicsofseveralruralWestAfricantribesmadethemidealprospectivedonors.AfterextensivenegotiationswiththeStateDepartmentandthegovernmentofthenationofBurami,thecompanywasabletosignanagreementwithseveralofthetribalchieftains.

AsLevinreviewedthesefacts,andthemanycostsinvolvedinthesaleofacommodityasfragileasblood,heconcludedthatthepublicitywasgrosslyunfair.Histhoughtswereinterruptedbythereporter$$squestion:$$Mr$.$Levin,isitnecessarytosellavitallyneededmedicalsupply,likeblood,atsuchhighpricesespeciallytopoorpeopleinsuchacriticalsituation?$$Ourpricesaredeterminedonthebasisofalotofcoststhatweincurthatthepublicisn$$tevenawareof$,$Levinresponded$.$However,whenreporterspressedhimfordetailsofthese$$relevant$$costs$,$Levinrefusedanyfurthercomment.Henotedthatsuchinformationwasproprietaryinnatureandnotforpublicconsumption.$($Source:RobertD.Hay,EdmundR.Gray,andPaulH.Smith,BusinessandSociety:PerspepctivesonEthics&SocialResponsibility,$3$rded.$($Cincinnati:South$-$Western,$1989,$pp$\mathrm{.}124-125)$