On 19 October, Abbott Laboratories announced that it plans to separate into two publicly traded companies, one in medical products, including Abbott Vascular, and the other in research-based pharmaceuticals.
According to Abbott, the medical products company will retain the Abbott name. It will consist of Abbott’s existing diversified medical products portfolio including its branded generic pharmaceutical, devices, diagnostic, and nutritional businesses. These businesses generate US$22 billion in annual revenue. The company will also have a broad-based pipeline of new products and technologies. Abbott’s current leader, Miles D White will remain chairman and chief executive officer of the medical products company.
The research-based pharmaceutical company, which will be named later, will include Abbott’s current portfolio of proprietary pharmaceuticals and biologics. The pharmaceutical company has US$18 billion in annual revenue with a portfolio of brands that includes Humira, Lupron, Synagis, Kaletra, Creon, and Synthroid. Additionally, the company has a pipeline of research and development assets in specialty therapeutic areas such as hepatitis C, immunology, chronic kidney disease, women’s health, oncology, and neuroscience. Richard A Gonzalez, currently Abbott’s executive vice president, Global Pharmaceuticals, will become chairman and chief executive officer of the research-based pharmaceutical company.
The transaction, which is expected to be completed by the end of 2012, is intended to take the form of a tax-free distribution to Abbott shareholders of a new publicly traded stock for the new pharmaceutical company. The expected stock distribution ratio will be determined at a future date. The transaction is subject to final approval by the Abbott board of directors, receipt of a favourable ruling from the Internal Revenue Service on the tax-free nature of the transaction, and the effectiveness of a Form 10 registration statement that will be filed with the Securities and Exchange Commission.