What changed in this filing

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Item 1. Business

2025-02-21 compared with 2024-02-16 · 51 added, 64 removed, 170 unchanged (40% of the section changed)

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Abbott Laboratories is an Illinois corporation, incorporated in 1900.

Abbott’s* principal business is the discovery, development, manufacture, and sale of a broad and diversified line of health care products.

Abbott’s* principal business is the discovery, development, manufacture, and sale of a broad and diversified line of healthcare products.

NARRATIVE DESCRIPTION OF BUSINESS

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These products include a broad line of branded generic pharmaceuticals manufactured worldwide and marketed and sold outside the United States in emerging markets.

These products are generally sold directly to wholesalers, distributors, government agencies, health care facilities, pharmacies, and independent retailers from Abbott-owned distribution centers or public warehouses, depending on the market served.

These products are generally sold directly to wholesalers, distributors, government agencies, healthcare facilities, pharmacies, and independent retailers from Abbott-owned distribution centers or public warehouses, depending on the market served.

Certain products are co-marketed or co-promoted with, or licensed from, other companies.

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• cardiovascular and metabolic products, including Lipanthyl™ and TriCor™, for the treatment of dyslipidemia;

Teveten™ and Teveten™ Plus, for the treatment of essential hypertension, and Physiotens™, for the treatment of hypertension;

Omacor™, for the treatment of hypertriglyceridemia;

Physiotens™, for the treatment of hypertension;

and Synthroid™, for the treatment of hypothyroidism;

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and Influvac™, an influenza vaccine;

• biosimilar products, including the areas of oncology and women's health.

The Established Pharmaceutical Products segment directs its primary marketing efforts toward building strong brands with key stakeholders, including consumers, pharmacists, physicians, and other healthcare providers.

Government agencies are also important customers.

Competition in the Established Pharmaceutical Products segment is generally from other health care and pharmaceutical companies.

Competition in the Established Pharmaceutical Products segment is generally from other healthcare and pharmaceutical companies.

In addition, the substitution of generic drugs for the brand prescribed and introduction of additional forms of already marketed established products by generic or branded competitors may increase competitive pressures.

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These products include a broad line of pediatric and adult nutritional products manufactured, marketed, and sold worldwide.

These products are generally marketed and sold directly to consumers and to institutions, wholesalers, retailers, health care facilities, government agencies, and third-party distributors from Abbott-owned distribution centers or third-party distributors.

These products are generally marketed and sold directly to consumers and to institutions, wholesalers, retailers, healthcare facilities, government agencies, and third-party distributors from Abbott-owned distribution centers or third-party distributors.

The principal products included in the Nutritional Products segment are:

• various forms of infant formula and follow-on formula, including Similac ® , Similac ® 360 Total Care ® , Similac Pro-Advance ® , Similac ® Advance ® , Similac 360 Total Care ® Sensitive, Similac Sensitive ® , Go & Grow by Similac ® , Similac ® NeoSure ® , Similac ® Organic, Similac ® Special Care ® , Similac Total Comfort ® , Similac ® Soy Isomil ® , Similac ® Alimentum ® , EleCare ® , Gain™, and Grow™;

• adult and other pediatric nutritional products, including Ensure ® , Ensure Plus ® , Ensure ® Enlive ® , Ensure ® (with NutriVigor™), Ensure ® Max Protein, Ensure ® High Protein, Glucerna ® , Glucerna ® Hunger Smart ® , ProSure™, PediaSure ® , PediaSure SideKicks ® , PediaSure ® Peptide, Juven ® , Abound™, Pedialyte ® and Zone Perfect ® ;

• nutritional products used in enteral feeding in health care institutions, including Jevity ® , Glucerna ® 1.2 Cal, Glucerna ® 1.5 Cal, Osmolite ® , Oxepa ® , Freego™ (Enteral Pump) and Freego™ sets, Nepro ® , and Vital ® .

Primary marketing efforts for nutritional products are directed toward consumers or to securing the recommendation of Abbott’s brand of products by physicians or other health care professionals.

• adult and other pediatric nutritional products, including Ensure ® , Ensure Plus ® , Ensure ® Enlive ® , Ensure ® NutriVigor™, Ensure ® Max Protein, Ensure ® High Protein, Glucerna ® , Glucerna Hunger Smart ® , ProSure™, PediaSure ® , PediaSure SideKicks ® , PediaSure ® Peptide, Juven ® , Abound™, and Pedialyte ® ;

• nutritional products used in enteral feeding in healthcare institutions, including Jevity ® , Glucerna ® 1.2 Cal, Glucerna ® 1.5 Cal, Osmolite ® , Oxepa ® , Freego™ (Enteral Pump) and Freego™ sets, Nepro ® , and Vital ® .

Primary marketing efforts for nutritional products are directed toward consumers or physicians or other healthcare professionals.

In addition, nutritional products are also promoted directly to the public by consumer marketing efforts in markets where permitted.

Competition for nutritional products in the segment is generally from other diversified consumer and health care manufacturers.

Competition for nutritional products in the segment is generally from other diversified consumer and healthcare manufacturers.

Competitive factors include consumer advertising, formulation, packaging, scientific innovation, price, retail distribution, and availability of product forms.

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Medical Devices

These products include a broad line of rhythm management, electrophysiology, heart failure, vascular and structural heart devices for the treatment of cardiovascular diseases, and diabetes care products for people with diabetes, as well as neuromodulation devices for the management of chronic pain and movement disorders.

These products include a broad line of rhythm management, electrophysiology, heart failure, vascular and structural heart devices for the treatment of cardiovascular diseases, and diabetes care and continuous glucose monitoring products, as well as neuromodulation devices for the management of chronic pain and movement disorders.

Medical devices are manufactured, marketed and sold worldwide.

In the United States, depending upon the product, medical devices are generally marketed and sold directly to wholesalers, hospitals, ambulatory surgery centers, physicians’ offices, and distributors from Abbott-owned distribution centers, public warehouses or third party distributors.

In the United States, depending upon the product, medical devices are generally marketed and sold directly to wholesalers, hospitals, ambulatory surgery centers, physicians’ offices, consumers, and distributors from Abbott-owned distribution centers, public warehouses or third party distributors.

Outside the United States, sales are made either directly to customers or through distributors, depending on the market served.

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the OPTIS ® integrated systems with Ultreon ® 1.0 and 2.0 Software, compatible with the Dragonfly OPTIS ® and OpStar ® imaging catheters and PressureWire ® fractional flow reserve measurement systems;

the JETi ® peripheral thrombectomy systems for clot removal;

and Diamondback 360 ® coronary and peripheral orbital atherectomy systems;

Diamondback 360 ® coronary and peripheral orbital atherectomy systems;

and Esprit™ BTK everolimus eluting resorbable scaffold system;

• structural heart products, including MitraClip ® , a mitral valve transcatheter edge-to-edge repair system;

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• continuous glucose and blood glucose monitoring systems under the FreeStyle ® brand such as the FreeStyle Libre ® system, including sensors, data management decision software, test strips, and accessories for people with diabetes;

and the Lingo ® continuous glucose monitoring system, including sensors and data management decision software for people’s health and wellness;

• neuromodulation products, including spinal cord stimulators Proclaim ® Plus and Proclaim ® XR recharge-free implantable pulse generators (IPG) and rechargeable Eterna ® IPG, each with BurstDR ® stimulation, and Proclaim ® DRG IPG, a neurostimulation device designed for dorsal root ganglion therapy, for the treatment of chronic pain disorders;

and the Infinity ® Deep Brain Stimulation System with directional lead technology for the treatment of movement disorders.

and the non-rechargeable Infinity™ deep brain stimulation (DBS) system and the rechargeable Liberta RC™ DBS system, each with directional lead technology for the treatment of movement disorders.

These products are subject to competition in technological innovation, price, convenience of use, service, product performance, long-term supply contracts, and product potential for overall cost-effectiveness and productivity gains.

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Abbott purchases, in the ordinary course of business, raw materials and supplies essential to Abbott’s operations from numerous suppliers in the United States and around the world.

After several years of challenges to the global supply chain caused in part by the COVID-19 pandemic and macroeconomic conditions such as inflationary pressures and labor shortages, Abbott's global supply chain has improved.

There have been no recent significant availability problems or supply shortages for raw materials or supplies.

A more detailed discussion on the global supply chain challenges and its resulting impact on Abbott’s business is contained in Item 1A.

Risk Factors and in the "Financial Review” section in Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Patents, Trademarks, and Licenses

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Principal trademarks and the products they cover are discussed in the Narrative Description of Business on pages 1 through 4.

These, and various patents that expire during the period 2024 to 2044, in the aggregate, are believed to be of material importance in the operation of Abbott’s business.

These, and various patents that expire during the period from 2025 to 2045, in the aggregate, are believed to be of material importance in the operation of Abbott’s business.

Abbott believes that no single patent, license, or trademark is material in relation to Abbott’s business as a whole.

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There are no significant seasonal aspects to Abbott’s business.

Abbott has no single customer that, if the customer were lost, would have a material adverse effect on Abbott.

Abbott has no single customer that, if the customer was lost, would have a material adverse effect on Abbott.

No material portion of Abbott’s business is subject to renegotiation of profits or termination of contracts at the election of a government.

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Diversity and Inclusion

Abbott is committed to developing a workplace that is inclusive for all.

Abbott ties executive compensation to human capital management, including diversity outcomes, to sustain an inclusive culture and the fair and balanced treatment of Abbott’s employees.

In 2023, Abbott released the third edition of its diversity, equity, and inclusion report, providing an update on Abbott’s plans, strategies, and actions to fulfill its commitment to develop an inclusive workplace.

Abbott is committed to fostering a workplace that is inclusive for all.

Abbott ties executive compensation to human capital management to sustain an inclusive culture and the fair and balanced treatment of Abbott’s employees.

Abbott's diversity, equity, and inclusion report provides an update on the plans, strategies, and actions undertaken to ensure that Abbott continues to attract, retain, and develop the best talent from the more than 160 countries in which it does business.

Abbott’s employee networks play an important role in building an inclusive culture across all Abbott operations.

A corporate officer serves as a sponsor for each of these networks, helping to align their objectives with Abbott’s business strategies.

Abbott has ten such networks, which are:

Asian Leadership and Cultural Network, Black Business Network, disABILITY Network (supporting employees with disabilities), Early Career Network (supporting early career employees), Flex Network (supporting employees with part-time and flexible schedules), LA VOICE Network (supporting Hispanic and Latino employees), PRIDE (supporting LGBTQ employees), Veterans Network, Women Leaders of Abbott, and Women in STEM.

Abbott has nine such networks, which are:

Asian Leadership and Cultural Network, Black Business Network, disABILITY Network (supporting employees with disabilities), Early Career Network (supporting early career employees), LA VOICE Network (supporting Hispanic and Latino employees), PRIDE (supporting LGBTQ employees), Veterans Network, Women Leaders of Abbott, and Women in STEM.

All networks are open to all Abbott employees.

Abbott offers professional development programs, which provide recent college graduates the opportunity to rotate through different areas of Abbott, often with the chance to work outside their home country.

In 2023, 58% of the participants were women.

Also, Abbott hosts hundreds of college students for paid internships.

In 2023, 59% of the U.S.

interns were women and 61% were minorities.

Further, Abbott has offered a STEM internship program for high school students in the U.S.

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The program’s objective is to increase the number of students pursuing STEM-related careers and contribute to a more diverse talent pipeline for Abbott.

In 2023, 74% of the STEM interns were women and 84% were minorities.

Health and Safety

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The development, manufacture, marketing, sale, promotion, and distribution of Abbott’s products are subject to comprehensive government regulation by the U.S.

Food and Drug Administration (FDA) and similar international regulatory agencies.

Government regulation by various international, supranational, federal and state agencies addresses (among other matters) the development and approval to market Abbott’s products, as well as the inspection of, and controls over, research and laboratory procedures, clinical investigations, product approvals and manufacturing, labeling, packaging, supply chains, marketing and promotion, pricing and reimbursement, sampling, distribution, quality control, post-market surveillance, record keeping, storage, and disposal practices.

In addition, Abbott’s clinical laboratories and associated testing services are subject to comprehensive government regulation, including registration, certification, and licensure, by federal, state, and local agencies, such as the Centers for Medicare & Medicaid Services, the Drug Enforcement Administration, the Substance Abuse and Mental Health Services Administration, and their respective foreign counterparts.

Certain of these agencies require our clinical laboratories to meet quality assurance, quality control, and personnel standards and undergo inspections.

During the COVID-19 public health emergency, many pandemic-related products (including diagnostic tests) were authorized by regulators for emergency use during the pandemic.

In addition, many governments enacted policies to expedite or promote access to health care in order to slow or stop the spread of the virus.

Examples included expansion of telehealth coverages and increased reimbursements for diagnostic testing.

federal public health emergency expired on May 11, 2023, which has not impacted the availability of the products authorized under the FDA’s Emergency Use Authorizations (EUA).

Abbott is actively pursuing the FDA’s customary regulatory approval process for various COVID-19 diagnostic tests, because the FDA could revoke or terminate its EUAs.

Abbott will continue to monitor further regulatory actions from relevant U.S.

government agencies and assess potential impacts on pandemic-related government policies and product authorizations.

Food and Drug Administration (FDA) and similar national and international regulatory agencies.

Government regulation by various international, supranational, federal and state agencies addresses (among other matters) the development and approval to market Abbott’s products, as well as the inspection of, and controls over, research and laboratory procedures, clinical investigations, product approvals and manufacturing, postmarket changes to products, labeling, packaging, supply chains, marketing and promotion, pricing and reimbursement, sampling, distribution, quality control, post-market surveillance, record keeping, storage, and disposal practices.

In addition, Abbott’s laboratories and associated testing services are subject to comprehensive government regulation, including registration, certification, and licensure, by federal, state, and local agencies, such as the Centers for Medicare & Medicaid Services, the Drug Enforcement Administration, the Substance Abuse and Mental Health Services Administration, and their respective foreign counterparts.

Certain of these agencies require Abbott's laboratories to meet quality assurance, quality control, and personnel standards and undergo inspections.

Abbott’s international operations are also affected by trade and investment regulations in many countries.

These may require local investment, restrict Abbott’s investments, or limit the import of raw materials and finished products.

Abbott’s laboratory facilities, home monitoring services, and durable medical equipment suppliers, which provide services, related products and medical devices to consumers, are subject to additional laws and regulations applicable to health care providers and suppliers that submit claims for reimbursement to third-party payors.

In the United States, Medicare, Medicaid, and other third-party payors may from time to time conduct inquiries, claims audits, investigations, and enforcement actions relating to the claims or enrollment criteria.

Abbott is subject to laws and regulations pertaining to health care fraud and abuse, including state and federal anti-kickback, anti-self-referral, and false claims laws in the United States.

Abbott’s laboratory facilities, home monitoring services, and durable medical equipment suppliers, which provide services, related products and medical devices to consumers, are subject to additional laws and regulations applicable to healthcare providers and suppliers that submit claims for reimbursement or payment to third-party payors, including government agencies such as Medicare and Medicaid, or governments.

In the United States, these entities may from time to time conduct inquiries, claims audits, investigations, and enforcement actions relating to the claims or enrollment criteria.

Abbott is subject to laws and regulations pertaining to healthcare fraud and abuse, including state and federal anti-kickback, anti-self-referral, and false claims laws in the United States.

Prescription drug, nutrition, and medical device manufacturers such as Abbott are also subject to taxes, as well as application, product, user, establishment, and other fees.

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Compliance with these laws and regulations is costly and materially affects Abbott’s business.

Among other effects, health care regulations and significant changes thereto (such as the introduction of the Medical Devices Regulation and the In Vitro Diagnostic Medical Devices Regulation in the European Union) substantially increase the time, difficulty, and costs incurred in developing, obtaining and maintaining approval to market, and marketing newly developed and existing products.

Among other effects, healthcare regulations and significant changes thereto (such as the introduction of the Medical Devices Regulation and the In Vitro Diagnostic Medical Devices Regulation in the European Union) substantially increase the time, difficulty, and costs incurred in developing, obtaining and maintaining approval to market, and marketing newly developed and existing products.

Abbott expects this regulatory environment will continue to require significant technical expertise and investment to ensure compliance.

Failure to comply can delay the release of a new product or result in regulatory and enforcement actions, the seizure or recall of a product, the suspension or revocation of the authority necessary for a product’s production and sale, suspension or revocation of billing privileges, and other civil or criminal sanctions, including fines and penalties.

Similarly, compliance with the laws and regulations governing clinical laboratories and testing services requires specialized expertise.

Similarly, compliance with the laws and regulations governing laboratories and testing services requires specialized expertise.

Failure to comply with these regulatory requirements can result in sanctions, including suspension, revocation, or limitation of a laboratory’s certification, which is necessary to conduct business, as well as significant fines or criminal penalties.

Abbott’s business can also be affected by ongoing studies of the utilization, safety, efficacy, and outcomes of health care products and their components that are regularly conducted by industry participants, government agencies, and others.

Abbott’s business can also be affected by ongoing studies of the utilization, safety, efficacy, and outcomes of healthcare products and their components that are regularly conducted by industry participants, government agencies, and others.

These studies can call into question the utilization, safety, and efficacy of previously marketed products.

In some cases, these studies have resulted, and may in the future result, in the discontinuation of marketing of such products in one or more countries, and may give rise to claims for damages from persons who believe they have been injured as a result of their use.

Access to human health care products continues to be a subject of investigation and action by governmental agencies, legislative bodies, and private organizations in many countries.

Access to human healthcare products continues to be a subject of investigation and action by governmental agencies, legislative bodies, and private organizations in many countries.

A major focus is cost containment.

Efforts to reduce health care costs are also being made in the private sector, notably by health care payors and providers, which have instituted various cost reduction and containment measures.

Abbott expects that insurers and providers will continue attempts to reduce the cost or utilization of health care products.

Many countries control the price of health care products directly or indirectly, through reimbursement, payment, pricing, or coverage limitations.

Budgetary pressures on health care payors may also heighten the scope and severity of pricing pressures on Abbott’s products for the foreseeable future.

Efforts to reduce health care costs are also being made in the private sector, notably by healthcare payors and providers, which have instituted various cost reduction and containment measures.

Abbott expects that insurers and providers will continue attempts to reduce the cost or utilization of healthcare products.

Many countries control the price of healthcare products directly or indirectly, through reimbursement, payment, pricing, or coverage limitations.

Budgetary pressures on healthcare payors may also heighten the scope and severity of pricing pressures on Abbott’s products for the foreseeable future.

In the United States, the federal government regularly evaluates reimbursement for medical devices, diagnostics, supplies, and other products, as well as the procedures in which these products may be used.

The government follows a diagnosis-related group (DRG) payment system for certain institutional services provided under Medicare or Medicaid and has implemented a prospective payment system (PPS) for services delivered in hospital outpatient, nursing home, and home health settings.

DRG and PPS entitle a health care facility to a fixed reimbursement based on the diagnosis and/or procedure rather than actual costs incurred in patient treatment, thereby increasing the incentive for the facility to limit or control expenditures for many health care products.

DRG and PPS entitle a healthcare facility to a fixed reimbursement based on the diagnosis and/or procedure rather than actual costs incurred in patient treatment, thereby increasing the incentive for the facility to limit or control expenditures for many healthcare products.

Other payment methodology changes have been proposed and implemented from time to time.

For example, Medicare implemented a competitive bidding system for certain durable medical equipment (including diabetes products), enteral nutrition products, and supplies.

Additionally, the Protecting Access to Medicare Act established a new payment system for clinical laboratory tests in 2018.

Governmental cost containment efforts also affect Abbott’s nutritional products business.

In the United States, for example, under regulations governing the federally funded Special Supplemental Nutrition Program for Women, Infants, and Children, all states must have a cost containment program for infant formula.

In the United States, for example, under regulations governing the federally funded Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), all states must have a cost containment program for infant formula.

As a result, through competitive bidding states obtain rebates from manufacturers of infant formula whose products are used in the program.

The Patient Protection and Affordable Care Act (the Affordable Care Act) includes provisions known as the Physician Payments Sunshine Act, which requires manufacturers of drugs, devices, and medical supplies covered under Medicare and Medicaid to record any transfers of value to physicians and teaching hospitals and to report this data to the Centers for Medicare & Medicaid Services for subsequent public disclosure.

In October 2018, the Substance Use Disorder Prevention that Promotes Opioid Recovery and Treatment for Patients and Communities Act significantly expanded the types of healthcare providers for which reporting is required, beginning with reports filed in 2022.

Similar reporting requirements have also been enacted on the state level domestically, and an increasing number of governments worldwide either have adopted or are considering similar laws requiring transparency of interactions with health care professionals.

Similar reporting requirements have also been enacted at the state level domestically, and an increasing number of governments worldwide either have adopted or are considering similar laws requiring transparency of interactions with healthcare professionals.

Failure to report appropriate data may result in civil or criminal fines and/or penalties.

Policy changes or implementation of new health care legislation could result in significant changes to health care systems.

Policy changes or implementation of new healthcare legislation could result in significant changes to healthcare systems.

In the United States, this could include potential modification, including expansion or repeal of all or parts of the Affordable Care Act.

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For example, the European Union, China, various other countries, and various U.S.

states (e.g., California, Virginia, and Colorado) have enacted or are considering enacting data protection laws that contain significant compliance obligations and financial penalties for noncompliance.

In addition, regulators with general consumer protection authority, such as the Federal Trade Commission and U.S.

states Attorneys General, are focused on how consumer data is used by entities in the health care industry.

Further, there are regulations of data privacy and security that are specific to health care companies.

states have enacted or are considering enacting data protection laws that contain significant compliance obligations and financial penalties for noncompliance.

In addition, regulators with general consumer protection authority, such as the U.S.

Federal Trade Commission and U.S.

states Attorneys General, are focused on how consumer data is used by entities in the healthcare industry.

Further, there are regulations of data privacy and security that are specific to healthcare companies.

For example, the U.S.

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Transferring and managing protected information will become more challenging as laws and regulations are enacted or amended, and Abbott expects there will be increasing complexity in this area.

Abbott expects debate to continue at all government levels worldwide over the manufacture, quality assurance requirements, marketing authorization processes, post-market surveillance requirements, availability, method of delivery, and payment for health care products and services, as well as data privacy and security.

Abbott believes that future legislation and regulation in the markets it serves could affect the timing and expense associated with bringing health care products or services to market, access to health care products and services, increase rebates, reduce prices or reimbursements or the rate of price increases for health care products and services, change health care delivery systems, create new fees and obligations for the pharmaceutical, nutrition, diagnostic, and medical device industries, or require additional reporting and disclosure.

It is not possible to predict the extent to which Abbott or the health care industry in general might be affected by the matters discussed above.

Abbott expects debate to continue at all government levels worldwide over the manufacture, quality assurance requirements, marketing authorization processes, post-market surveillance requirements, availability, method of delivery, and payment for healthcare products and services, as well as data privacy and security.

Abbott believes that future legislation and regulation in the markets it serves could affect the timing and expense associated with bringing healthcare products or services to market, access to healthcare products and services, increase rebates, reduce prices or reimbursements or the rate of price increases for healthcare products and services, change healthcare delivery systems, create new fees and obligations for the pharmaceutical, nutrition, diagnostic, and medical device industries, or require additional reporting and disclosure.

It is not possible to predict the extent to which Abbott or the healthcare industry in general might be affected by the matters discussed above.

INTERNET INFORMATION

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business