Abbott Laboratories

Abbott Laboratories
	File:Abbott Laboratories logo.svg Logo used since 2017
Company type	Public
Industry	Medical devices, healthcare, pharmaceuticals, diagnostics, nutrition
Founded	January 1, 1888; 138 years ago in Chicago, Illinois, United States
Founder	Wallace Calvin Abbott
Headquarters	Abbott Park, Illinois, United States
Area served	Worldwide (operates in more than 160 countries)
Products	Pedialyte, Similac, BinaxNOW, Ensure, Glucerna, ZonePerfect, FreeStyle Libre, i-STAT, MitraClip
Website	www.abbott.com

Abbott Laboratories is a global American corporation specializing in medical devices and health care, with its headquarters located in Abbott Park, Illinois. Established in 1888 by Wallace Calvin Abbott, a physician from Chicago, the company originally concentrated on developing known pharmaceutical compounds. Presently, Abbott’s operations focus on four main areas: medical devices, diagnostics, branded generic pharmaceuticals, and nutritional products. In 2013, it separated its research-driven pharmaceuticals division to create AbbVie.

Among its prominent products are Pedialyte, Similac, BinaxNOW, Ensure, Glucerna, ZonePerfect, FreeStyle Libre, i-STAT, and MitraClip. Abbott maintains a worldwide presence with a broad product range that secures its position within the healthcare and medical technology industries.

Origins and initial development

The company was founded in 1888 by Wallace Abbott (1857–1921), a University of Michigan alumnus and practicing doctor, who launched the Abbott Alkaloidal Company in Ravenswood, Chicago. He pioneered the creation of alkaloid-based medicinal extracts—such as morphine, quinine, strychnine, and codeine—in granulated dosages to provide more precise and reliable dosing compared to liquid formulations. In 1922, the company moved its operations to North Chicago, Illinois.

Expansion beyond the United States

Abbott established its first overseas branch in London in 1907, soon followed by an office in Montreal. Abbott India Ltd originated under various names since its founding in 1944 and now runs two manufacturing plants in Karachi, Pakistan, where marketing activities began in 1948 with a workforce exceeding 1,500 individuals. In 1962, Abbott entered a joint venture with Japan’s Dainippon Pharmaceutical to manufacture radiopharmaceutical products.

The acquisition of Ross Laboratories in 1964 broadened Abbott’s nutritional product lineup with items such as Similac, Pedialyte, and Ensure. Richard Ross joined Abbott’s board after this merger until 1983. By 1965, Abbott had further extended its European operations by opening offices in Italy and France.

In 1985, Abbott collaborated with Taisho Pharmaceutical to obtain international rights for clarithromycin (marketed as Biaxin), which received FDA approval in 1991. The drug became generic in Europe by 2004 and in the US by 2005; it is also listed on the WHO Model List of Essential Medicines.

Abbott’s growth strategy prominently featured targeted acquisitions and alliances that expanded its global footprint and diversified its offerings across pharmaceutical and nutritional sectors.

Developments in the 21st century

In 2001, Abbott expanded its pharmaceutical portfolio significantly by acquiring Knoll, BASF’s pharmaceutical division, for $6.9 billion. The following year saw divestitures including the sale of the Selsun Blue brand to Chattem and later Clear Eyes and Murine brands to Prestige Brands as part of focusing on core consumer products. In 2004, Abbott strengthened its diabetes management segment by acquiring TheraSense and merging it with MediSense to form Abbott Diabetes Care.

Abbott played a role in Boston Scientific’s acquisition of Guidant Corporation in 2006 by purchasing Guidant’s vascular device business. In 2007, it acquired Kos Pharmaceuticals for $3.7 billion, adding cardiovascular medications Niaspan and Advicor to its lineup. A proposed sale of two diagnostics divisions to General Electric was abandoned due to unresolved terms.

The company sold its Queenborough manufacturing facility in the UK to Aesica Pharmaceuticals in 2007 while rebranding Ross Products as Abbott Nutrition to emphasize its nutrition business. In 2009, Abbott acquired Advanced Medical Optics (later sold to Johnson & Johnson in 2017) and inaugurated a research center at the University of Illinois at Urbana-Champaign to foster innovation.

In 2010, Abbott purchased Solvay S.A.’s pharmaceuticals unit for $6.2 billion, boosting both product variety and presence in emerging markets. That year also included the acquisition of STARLIMS—a laboratory information management system provider—for $123 million as part of an investment into digital health technologies. Additionally, Abbott announced a $3.72 billion deal to acquire Piramal Healthcare’s generic drug division in India, further expanding its generics market reach.

Spin-offs

In 2004, Abbott separated its hospital products segment, creating Hospira, which employed 14,000 individuals; this entity was subsequently acquired by Pfizer in 2015.

Abbott revealed in October 2011 its intention to divide into two distinct companies: AbbVie, which would concentrate on research-driven pharmaceuticals, and a new Abbott entity that would continue to manage medical devices, international generics, diagnostics, and nutrition brands such as Similac, Pedialyte, Glucerna, and Ensure. Prior to this division, Abbott executed substantial cost reductions and recorded a $478 million charge during the third quarter of 2012. The formal split took effect on January 1, 2013, with AbbVie commencing trading on the New York Stock Exchange.

Further developments

On May 16, 2014, Abbott announced the $2.9 billion purchase of holding company Kalo Pharma Internacional S.L., thereby obtaining full control over Chilean pharmaceutical firm CFR Pharmaceuticals and doubling its portfolio of branded generic drugs.

In December 2014, Abbott expanded its Russian manufacturing capacity by acquiring Veropharm for $410 million. This transaction included three production facilities and bolstered Abbott’s workforce in Russia, where it already had approximately 1,400 employees.

September 2015 marked Abbott’s completion of a $250 million acquisition of Tendyne Holdings, a privately held medical device company specializing in minimally invasive mitral valve replacement technologies. By January 2020, Tendyne’s Mitral Valve system earned CE Mark certification, permitting commercial use throughout Europe.

Abbott announced plans in February 2016 to acquire Alere for $5.8 billion and followed with a $25 billion acquisition of St. Jude Medical in January 2017. The Alere transaction finalized in October 2017, positioning Abbott as the dominant player in the $7 billion point-of-care diagnostics market segment within the larger $50 billion in-vitro diagnostics sector. This acquisition also encompassed Arriva Medical, the largest mail-order diabetes supplier in the U.S., which ceased operations by the end of 2017.

In 2017, the FDA granted approval for Abbott’s FreeStyle Libre glucose monitoring system, featuring sensor technology that eliminated the need for finger pricks. Later in November 2018, Abbott secured FDA clearance for FreeStyle LibreLink, a smartphone application designed to read glucose levels.

In January 2019, Abbott enhanced its portfolio of minimally invasive heart valve treatments by acquiring Cephea Valve Technologies.

Throughout the COVID-19 pandemic, Abbott significantly scaled up its diagnostics capabilities. In March 2020, it obtained FDA emergency use authorization (EUA) for a rapid SARS-CoV-2 test capable of delivering results within 13 minutes. Additional EUAs were granted for molecular and antibody tests compatible with various Abbott laboratory platforms. In August 2020, Abbott introduced BinaxNOW—a portable antigen test priced at $5—with EUA for swift COVID-19 detection. By January 2021, over 400 million COVID-19 tests had been distributed worldwide by Abbott.

To broaden its peripheral vascular product offerings, Abbott acquired Walk Vascular, LLC in September 2021. In January 2022, it launched Lingo—a line of consumer biowearable sensors designed to optimize exercise routines and nutrition management.

Following Russia’s invasion of Ukraine in 2022, Abbott continued its operations within Russia but paused non-essential activities including new investments and advertising campaigns. The Yale School of Management classified Abbott’s response as “Buying Time,” assigning it a “Grade D” for its approach to the situation.

Abbott received FDA clearance for FreeStyle Libre 3—an advanced continuous glucose monitoring device—in May 2022. In August that year, the FDA approved Proclaim Plus: a multi-use spinal cord stimulation system targeting chronic pain across six different body regions with battery life extending up to ten years.

October 2022 saw the FDA grant emergency use authorization to Abbott’s Alinity m MPXV PCR test—the first commercially authorized monkeypox diagnostic test by the agency.

On July 5, 2023, Abbott secured FDA approval for its Aveir DR leadless pacemaker system. The following month, the company announced intentions to acquire Bigfoot Biomedical to enhance personalized diabetes care solutions.

Currently, Abbott operates across more than 160 countries with a global supply chain sourcing from at least 62 suppliers worldwide.

History of Acquisitions

Abbott Laboratories (Founded 1885 as Abbott Alkaloidal Company)
- Ross Laboratories (Acquired 1964)
- SmithKline Beecham (Acquired 1982, subsequently divested)
- Knoll (Acquired 2001)
- Selsun Blue (Divested to Chattem in 2002)
- Murine (Divested to Prestige Brands in 2002)
- Clear Eyes (Divested to Prestige Brands in 2002)
- i-STAT (Acquired 2004)
- TheraSense (Acquired 2004)
- Guidant (vascular device division) (Acquired 2006)
  - IntraLase Corp (Acquired 2007)
- Advanced Medical Optics (Acquired 2009)
- Solvay Pharmaceuticals (Acquired 2010)
- STARLIMS (Acquired 2010)
  - Lab Data Management Ltd (Acquired 2008)
- IDEV Technologies (Acquired 2013)
- OptiMedica Corporation (Acquired 2013)
- Veropharm (Acquired 2014)
- Topera, Inc (Acquired 2014)
- Kalo Pharma Internacional S.L. (Acquired 2014)
  - CFR Pharmaceuticals
- Tendyne Holdings Inc. (Acquired 2015)
- Alere (Acquired 2016)
  - Epocal, Inc. (Acquired 2013)
  - Arriva Medical (Acquired 2012)
- St. Jude Medical (Founded 1976, Acquired 2016)
  - Pacesetter, Inc. (Acquired 1994)
  - Daig Corporation (Acquired 1996)
  - Heart Valve Company (Acquired 1996)
  - Biocor Industria (Acquired 1996)
  - Ventritex (Acquired 1997)
  - Tyco International (Angio-Seal division) (Acquired 1999)
  - Endocardial Solutions (Acquired 2005)
  - Advanced Neuromodulation Systems (Acquired 2005)
  - MediGuide (Acquired 2008)
  - AGA Medical (Acquired 2010)
  - LightLab Imaging (Acquired 2010)
  - Nanostim Inc (Acquired 2013)
  - Endosense (Acquired 2013)
  - CardioMEMS Inc. (Acquired 2014)
  - Spinal Modulation (Acquired 2015)
  - Thoratec Corporation (Acquired 2015)
    - Apica Cardiovascular Limited (Acquired 2014)
    - Levitronix (Medical division) (Acquired 2011)
    - Getinge Group (Heat pump technology division) (Acquired 2014)
    - Thermo Cardiosystems (Acquired 2010)
- Cephea Valve Technologies, Inc. (Acquisition completed in 2019)
- Walk Vascular, LLC (Joined in 2021 through acquisition)
- Cardiovascular Systems, Inc. (Added via acquisition in 2023)
- Bigfoot Biomedical (Integrated through acquisition in 2023)

Financial Performance

During the fiscal year of 2021, Abbott Laboratories achieved a net income of US$7.071 billion alongside revenues totaling US$43.075 billion, marking an impressive organic revenue increase of approximately 24.5% compared to the preceding year. By year-end, the stock price stood at $140.74.

Year	Revenue (million US$)	Net Income (million US$)	Total Assets (million US$)	Share Price (US$)	Number of Employees
2005	22,338	3,372	29,141	17.37
2006	22,476	1,717	36,178	17.46
2007	25,914	3,606	39,714	21.34
2008	29,528	4,881	42,419	21.89
2009	30,765	5,746	52,582	19.51
2010	35,167	4,626	60,574	20.75
2011	21,407	4,728	60,277	21.26
2012	19,050	5,963	67,235	26.57
2013	19,657	2,576	42,953	31.90	69,000
2014	20,247	2,284	41,207	37.39	77,000
2015	20,405	4,423	41,247	43.16	74,000
2016	20,998	1,400	52,666	38.65	75,000
2017	27,390	477	76,250	47.50	99,000
2018	30,578	2,368	67,173	69.50	103,000
2019	31,904	3,687	67,887	86.86	107,000
2020	34,608	4,495	72,548	109.49	109,000
2021	43,075	7,071	75,196	140.74	113,000

Taxation

On 19 March 2019, reports identified Abbott as a long-standing user of the Double Irish tax arrangement, a legal yet contentious Irish mechanism utilized by American multinational corporations to minimize corporate taxes on profits earned outside the U.S. Abbott's Irish holding entity, Abbott Laboratories Vascular Enterprises (ALVE), which is based in Bermuda, had no employees in 2017 but oversaw global distribution and technology licensing activities. Established in 2003, ALVE recorded pre-tax earnings of €2 billion in both 2016 and 2017 from revenues totaling €5.2 billion, without incurring taxes on these profits. As an unlimited liability company (ULC), ALVE had not submitted Irish financial statements until EU regulations mandated disclosures in 2018; its registered office was listed at Matheson, Ireland’s largest tax law firm known for advising major corporations like Microsoft and Google on Double Irish schemes.

In September 2021, the Irish Times revealed Abbott's employment of the Single Malt tax strategy to protect profits derived from its COVID-19 testing kits, underscoring the company’s continued use of sophisticated tax planning within its international operations.

Organization

Abbott’s primary business segments encompass diagnostics, medical devices, branded generic pharmaceuticals, and nutritional products, with growth driven by targeted acquisitions.

As of 2021, the company’s divisions comprised:

Nutrition: including pediatric nutrition brands (such as Similac, Isomil, Gain), adult nutrition products (like Ensure, ZonePerfect), and specialized dietary supplements (including Glucerna, Juven)
Diagnostics: covering core laboratory services, molecular diagnostics, point-of-care testing, rapid diagnostics, and informatics solutions
Medical Devices: featuring rhythm management, electrophysiology, heart failure treatment, structural heart interventions, neuromodulation therapies, and diabetes care
Established Pharmaceuticals: branded generic medications primarily marketed in emerging economies

Management

Miles D. White began his career at Abbott in 1984 and led the company as CEO for 21 years while also holding significant leadership roles such as executive chairman. Robert B. Ford joined Abbott in 1996 and progressed through various leadership positions including executive vice president of medical devices.

In November 2019, White announced his retirement from the CEO role. Robert B. Ford took over as president and CEO in March 2020 and was subsequently named chairman, marking a planned executive transition aligned with Abbott’s strategic growth objectives and expanding market presence.

Recognition

In 2022, Abbott was ranked 86th on the Fortune 500 list of largest U.S.-based companies. Fortune also included Abbott among its Top 50 World's Most Admired Companies and Blue Ribbon companies in 2021 and placed it on the Change the World list in 2020. The same year, Abbott achieved the #10 spot on Fast Company’s Most Innovative Companies in Sports for its Libre Sense product and earned an Honorable Mention at the World Changing Ideas Awards. The Galien Foundation honored Abbott’s FreeStyle Libre as the Best Medical Technology over the past 50 years (1970–2020).

Abbott has been featured on Seramount/Working Mother’s "100 Best Companies" list for 21 consecutive years and recognized as a leading company for executive women by Seramount. It has also appeared on Science magazine's Top 20 Employers list. Additionally, Abbott received DiversityInc's diversity recognition for 19 consecutive years (2004–2022) and has been listed on the Dow Jones Sustainability Index for 18 straight years.

Nutrition

Abbott's range of pediatric nutrition products encompasses:

Similac variants (Gain, GainPlus, GainSchool, Neosure, Essencia, Tummicare HW)
Isomil
Pedialyte
PediaSure (including Plus and Plus 10+)

For adult nutrition, offerings include:

Ensure (with Ensure Gold as a premium option)
Glucerna (marketed as Ensure Diabetes Care in India)
Juven
ZonePerfect

Diagnostics

The primary diagnostic solutions offered are:

i-STAT point-of-care analyzers, which are also utilized in veterinary applications
Alinity platform
Architect system
IDNOW rapid testing devices
Digival analyzers
BinaxNOW quick diagnostic tests

Medical devices

Abbott's portfolio of medical devices features continuous glucose monitoring systems such as:

The FreeStyle Libre series (Libre, Libre 2, Libre 3)

Cardiovascular device offerings include:

MitraClip
Confirm Rx
Amplatzer Piccolo Occluder
Heartmate assist devices
Xience stents
CARDIOMEMS implantable sensors
Gallant implantable cardioverter defibrillator (ICD)
CentriMag circulatory support device
Aveir DR pacemaker, which received FDA approval in July 2023

Neuromodulation product lines consist of:

BurstDR and FlexBurst360 neuromodulation technologies
Proclaim DRG Neurostimulation System
Infinity Deep Brain Stimulation System
Proclaim XR and Elite Recharge-Free Spinal Cord Stimulators
NT2000IX Radiofrequency Generator
Prodigy MRI-compatible Spinal Cord Stimulation System

Leuprorelin

In October 2001, TAP Pharmaceutical Products—an Abbott Laboratories subsidiary—alongside the US Department of Justice and multiple state attorneys general, resolved criminal and civil allegations involving Medicare fraud and unlawful marketing practices related to leuprorelin. The settlement totaled $875 million, marking a record in pharmaceutical settlements. This amount included $290 million for violations of the Prescription Drug Marketing Act, $559.5 million for Medicare overbilling, and $25.5 million reimbursing Medicaid false claims across 50 states plus Washington, D.C. The case was initiated under the False Claims Act with whistleblowers Douglas Durand, former TAP VP of sales, and Joseph Gerstein, a physician at Tufts University, receiving $95 million from the settlement.

Later legal actions concerning leuprorelin’s prescribing practices or warning adequacy were unsuccessful. Between 2010 and 2013, the FDA revised Lupron’s labeling to highlight risks such as thromboembolism, bone density reduction, and seizures while affirming that benefits surpass risks if used according to approved guidelines. Since 2017, the FDA has been reviewing potential links between leuprorelin and musculoskeletal or connective tissue pain.

Humira

In March 2003, Cambridge Antibody Technology (CAT), a British firm, initiated proceedings in the High Court of London to enforce royalty offset terms related to Humira (Adalimumab) against Abbott Laboratories. The December 2004 judgment favored CAT, obligating Abbott to remit $255 million to CAT instead of royalties owed to the Medical Research Council (MRC), Scripps Research Institute, and Stratagene on Humira sales post-December 2004. This sum included $191 million designated for the UK MRC plus an additional $7.5 million spread over five years starting in 2006, contingent upon Humira’s continued market presence.

Operation Headwaters

In October 2003, Abbott Laboratories along with two of its subsidiaries reached a $600 million settlement and accepted criminal convictions connected to kickback schemes revealed by the FBI's "Operation Headwaters" probe.

Depakote

On October 2, 2012, Abbott faced penalties amounting to $500 million plus an additional $198.5 million forfeiture due to unlawful promotion of Depakote for uses not approved by regulatory authorities. The company was placed under a five-year probation period with judicial oversight. Shareholders initiated derivative lawsuits against board members citing breaches of fiduciary responsibility. After Abbott spun off its research-driven pharmaceutical division, it relinquished commercial rights and liabilities associated with Humira and Depakote.

Glucose Monitors

In 2021, Abbott’s subsidiaries Arriva Medical LLC and Alere Inc agreed to pay $160 million to settle allegations of fraudulent Medicare claims related to glucose monitoring devices. The Department of Justice contended that Arriva distributed free monitors to stimulate consumable orders, receiving kickbacks from the increased sales volume. Additionally, they were accused of billing Medicare for monitors provided to patients who were either ineligible or deceased.

Plant Closure

Following reports linking infant illnesses and fatalities to bacterial infections, Abbott recalled baby formula products and temporarily closed its Michigan manufacturing plant in February 2022. After fulfilling initial FDA mandates, the facility resumed operations in June 2022. This event notably diminished Abbott's share in the infant nutrition market during the resulting product shortage.

Deep Brain Stimulation Device Recall

On July 18, 2023, Abbott issued a recall for its Proclaim and Infinity implantable pulse generators (IPGs) after patients reported being unable to exit MRI mode, which could necessitate surgical device replacement. There have been 186 incidents reported along with 73 injuries; no fatalities have been recorded. Abbott informed healthcare providers and regulatory bodies about the recall, clarifying that no returns or replacements of the devices are required.

Necrotizing Enterocolitis (NEC) Litigation

On July 26, 2024, a jury awarded $495 million in the case of Margo Gill versus Abbott Laboratories—comprising $95 million in compensatory damages and $400 million punitive—based on claims that Abbott’s infant formula designed for premature infants increased the risk of necrotizing enterocolitis (NEC), a severe gastrointestinal condition.

Sponsorship

Abbott became the title sponsor of the World Marathon Majors in 2015, significantly boosting its brand presence within international health and wellness arenas.

External links