ARTICLE SUMMARY:
Almost a decade ago, reversing a trend embarked upon by other major pharmaceutical companies, Abbott Laboratories spun off its proprietary drug business to focus on medical devices and diagnostics—a move that is paying big dividends.
Twenty-five years ago, as other major medical device companies like Johnson & Johnson and Medtronic plc were either making major moves into interventional cardiology, or like Edwards Lifesciences, crafting a strategy that specifically steered away from the space, Abbott Laboratories took a kind of middle-of-the-road approach. Long a powerhouse in diagnostics, Abbott’s first real foray into cardiovascular devices came with the acquisition of femoral artery closure device company Perclose in 1998. Smaller deals followed, with Abbott acquiring or in-licensing a number of niche technologies until it embarked upon a series of significant acquisitions, starting with the vascular business of Guidant, which at the time had just been acquired by Boston Scientific Corp., and then, most notably, its 2016 deal for St. Jude Medical, which brought a major franchise in structural heart, as well as the circulatory support business of Thoratec, which itself had earlier been acquired by St. Jude.
Along the way, Abbott also staked a claim in the diabetes management business through its 2004 $1.2 billion acquisition of Therasense and in ophthalmology through a series of smaller acquisitions. In addition, it made a major move into transcatheter valves through a pioneering deal for Evalve, an early mitral valve play, when the other major transcatheter companies were focused on aortic valves. Today, Abbott stands among the pantheon of medtech multinationals, with major franchises in a number of clinical spaces and it is moving to build on that.
Just under a decade ago, Abbott spun off its pharmaceutical business to focus on four key businesses: medtech, diagnostics, nutritionals, and branded generics. And five years ago, just before the pandemic hit, the company brought in Lisa Earnhardt, an industry veteran and Guidant alumna, to take over the reins of its medtech business. In the following interview, an expanded version of a discussion that took place this past June at Wilson Sonsini Goodrich & Rosati’s 29th Annual Medical Device Conference, Earnhardt talks about Abbott’s current medtech business and its plans for the future.
