Originally Published MX November/December 2003
BUSINESS NEWS
Abbott to Spin Off Hospital Products Business |
| Begley |
Abbott Laboratories (Abbott Park, IL) has announced plans to create a new hospital products company with estimated worldwide sales of $2.5 billion. The company will be spun off from Abbott's core global hospital products business.
The move will enable Abbott to focus on higher-growth segments of its medical products and pharmaceutical groups, as well as its proprietary technologies. Abbott's medical products group previously encompassed three business segments, including Ross nutritionals, diagnostics, and hospital products.
"With enhanced strategic, financial, and operational flexibility, the new company will have freedom to pursue alliances and other expansion opportunities," said Abbott CEO Miles D. White.
In 2002, Abbott reported overall sales of $17.7 billion, with 8.6% growth over 2001. The company's U.S. hospital products sales totaled $2.9 billion, with 7.2% growth over 2001. The company reported international hospital products sales of $785 million, with 3.5% growth.
The spin-off will take the form of a tax-free distribution to Abbott shareholders of a publicly traded stock for the new company. The transaction is expected to be completed in the first half of 2004.
The new company's business will include medication delivery systems, including electronic drug-delivery systems, infusion therapy, and critical-care products; generic pharmaceuticals, including acute-care injectables and anesthetics; and intensive care pharmaceuticals.
Abbott will retain interests in operating room and proprietary hospital drugs, pain management products, and a portion of its international hospital products business. It will also retain Abbott Vascular Devices and the recently acquired Spinal Concepts.
Christopher B. Begley, president of Abbott's U.S. hospital business, will become CEO of the new company, which will be named later and headquartered in Lake Forest, IL.
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