Abbott Laboratories (ABT) 19 Oct 222022 Q3 Earnings call transcript

Good morning and thank you for standing by. Welcome to Abbott’s Third Quarter 2022 Earnings Conference Call. All participants will be able to listen-only until the question-and-answer portion of this call. [Operator Instructions] This call is being recorded by Abbott.

With the exception of any participant’s questions asked during the question-and-answer session, the entire call, including the question-and-answer session is material copyrighted by Abbott. or Abbott’s recorded written be cannot rebroadcast expressed without permission. It Mr. now like would to I introduce Scott Investor Vice Leinenweber, President, Acquisitions. Relations, Licensing and

Good Executive and Vice Bob joining for Finance and Robert Chief thank provide Officer. me President, Officer; and Robert Financial Executive Funck, are and Ford, opening us. Bob and will Chief today Chairman morning With you remarks.

your Following their comments, questions. we will take

the competitive, factors including Reform purposes some expected XXXX, Before Abbott operations Item Abbott’s to law. other today for no and GAAP past, to subject abbott.com. Private except subsequent XX-K earnings are our the not made our report Robert. from our that changes indicated website financial are the to growth. for foreign growth I refers events affect as in on reconciled governmental, XXXX. a measures which and will Abbott may turn results impact be the conference or the Risk exchange Note started, results in predict financial used comparable developments, release ongoing XA, unable which forward-looking Abbott non-GAAP the These now sales cause materially uncertainties measure financial which that has any to as release the may to to forward-looking non-GAAP foreign our by measures statements on that on that XX, to today, of we excludes is Act over With undertakes call, of in impact in growth from Securities sales will XXXX. in Litigation for December get financial Economic, company annual be measures may call On sales reported forward-looking available growth, the those regulatory result Abbott’s risks exchange. on sales with these as performance. Form to organic required forward-looking to and statements help forward-looking at the differ of for that, actual investors Factors, revisions provided of a are financial noted, are rates, cautions obligation business understand statements could news today’s publicly ended GAAP basis, otherwise statements. commentary Unless because discussed filings organic future the year technological

Thanks, to morning, Today, year including guidance nine joining year, Scott. on quarter, and first earnings the flow full we increased back initial more thank guidance the provided you reported the share $X.XX. everyone, our share per of another of we earnings to Good for through per us. is adjusted of than Based strong our results ongoing higher we January. months $X.XX $X.XX, XX% in which performance than

throughout continues has globally, the in earlier of certain to Inflation U.S. to the the remain know, we dollar the time, some started year. you see to most continued seeing the staffing challenging. signs continued COVID And global of steady as intermittent dynamics, continuing world. recent our with unpredictable including as impact to shortages improvements. markets, quarter. but areas a in our At compared ever strengthen, lastly, surges same conditions force the chain stubborn macroeconomic are we have healthcare As be moderating supply though remains throughout impacts businesses to

began the in with coming reach several September, products, on infant which retail Sturgis, specialty We year. of expect several plant production our in we formulas. over store focus areas infant And our Michigan, other Over this important earlier restarted we EleCare months, to a will weeks. production Sturgis at July formula have manufacturing following of Similac temporary progress and the few the begin in shelves last made in we shutdown

U.S. the production to formula infant increase global our boosted to also supply network in We

our past the U.S. recall. to fact, In quarter during three of prior we did as we roughly customers delivered the to volume this formula the months same

Our number the program to food women, WIC, would supply ensure assistance children, that to federal and infant have priority to formula. access was infant one underserved participants

also we U.S. were And former same we the quarter, and federal concluded that lastly, more and entire and unfounded, analysis complaint. we from were of allegations the market about the investigation, site concluded both at conducted leadership Sturgis would benefit document and concluded that investigation OSHA manufacturing dropped and accusations the redundancy. extensive our this made the the a in quality made and infant employee former changes, During our a the included into former quarter, an country during which employee. interviews, by The organization, that month-long reviews capacity

we facility for are a nutrition with formulas. infant for $X.X U.S. a such, moving in specialty plans new forward investment As metabolic and billion

organic double-digit now with India, the EPD, XX% quarter. of along in profile I our We sets the I to are areas. with led employees to and ensure performance is which confident do, therapeutic profitability where execution. and since before all final site making Vietnam, beginning that feel its has the several has over stages currently EPD same headwinds. regulators macroeconomic the detail more Pharmaceuticals but of Brazil for are for recognize location, facility to I summarize across this we have clock Abbott increased new state-of-the-art and results quarter EPD steady growth the year, will expanded turning the also call double-digit in broad-based China, remaining will the by the product and a the strength work current with want our time across launches given unique experts commercial the sales period, over And more was around is fueled third We and last infant in new quite or and working now been formula several by progress matter. countries, thank And to more on growth achieved start will in Bob. businesses than production. there’s Strong a sales Established determining this cadence including other strong of standard

of a in The to overall. expectations, COVID higher which Moving be Whereas and status highly billion or decline sales anywhere than strong, lower way know just BinaxNOW, attending with include tests. before last year, in and at the to $X.X year test COVID Panbio lower growth similar amount whether are significantly and sales laboratory-based to to a tools. Diagnostics, which of symptoms but Rapid you driven a third year. very events tests, sales was test ID They or for to experiencing gatherings. to demand test this compared COVID sales compared were be have past affordable any and last quarter for proven modest NOW your to important quarter at our by time, provide demand last to almost quick practical in rapid resulted want where decline continues tests

of Excluding the sales internationally, revenues, rollout continued faster global diagnostic for fueled chemistry even Alinity COVID of immunoassay, tests routine grew testing and testing. clinical and by in instrument overall X% quarter our the molecular

with sales I Structural Medical globally. of Devices, quarter and sales where Lastly, the X.X% Care. In Diabetes Electrophysiology, led double-digit growth Heart U.S., up in will growth approximately the grew by was in wrap strong XX.X%

emerging largest delivers were impacted in which procedure which wearable before thinnest strengthening In was X second addition in X users well monitoring billion sensor. Libre half by to globally. volumes quarter growth to our Libre and to July automatically further sales in negatively strategic Libre remaining in Libre accuracy certain expect users intermittent and bring base more focus Libre were the launch impacted of the our smallest initiated U.S., sales end. including position August in Internationally, transitory which in Internationally, user diabetes year soft exceeded million that X rapidly by a move majority in Libre strategic COVID base the of country. in made vast volume new world in people, And with approximately X, those in than the transitioned trends, on China, Diabetes X.X Germany to position the the more constraints the already on disease. September. continuous system, items, in manage reduced This organic in In move to user to our a user we insulin with in reliant existing of the Type and of their well Care, and glucose with of temporarily sales during our to cardiovascular more lockdowns months. the expected the not fortifies similar of we expanded our as minute procedure somewhat couple work to by During $X grew certain are quarter as choice on secondly, of readings that over next additions our world’s improve supply areas, the strategically already benefits the We quarter where our constraints leadership strong over in including as we up market FreeStyle users Electrophysiology. sales full most the supply enhances notably, glucose generation to latest to and we XX%, unsurpassed X to the transition large markets, U.S., couple

to So guidance will environment, and of the business reflects significantly the the strong year. we nine performance turn Bob. surpassed EPS diversified of which achieved year, our now challenging raising in strength expectations, once strong we summary, execution, I Bob? the are for call the based model despite and our the again first another our on that months quarter for

Robert. Thanks,

As on earlier, the organic that references otherwise Scott to excludes an exchange. foreign mentioned basis, are please all sales unless growth of note which noted rates, impact

results, $X.X in while third anticipated which an decline versus were Turning sales testing-related stronger year. reflect last our billion, quarter. of increased the basis in organic sales on year-over-year COVID a quarter to sales X.X% the than

our shutdown by organic this Sturgis, year. growth of was in nutrition negatively a manufacturing plant Additionally, sales at earlier Michigan impacted temporary

an in Excluding third manufacturing testing-related by sales the basis the and Abbott quarter. impacted temporary sales on X% shutdown, organic sales U.S. COVID increased total the

on had year-over-year impact unfavorable an quarter exchange of sales. X% third Foreign

strengthen at During in compared versus the time U.S. saw the we the several sales dollar to call rates of on impact exchange a which slightly continue our in resulted unfavorable to currencies, more quarter, July. earnings

in adjusted the our of the was the of investment ratio margin which of we Adjusted and sales impacts gross businesses. aspects experienced other and XX.X% quarter. have certain inflation was investment third R&D nutrition and of costs XX.X% sales, SG&A the Regarding reflects distribution sales disruption of X.X% across adjusted manufacturing P&L, was manufacturing on the

revised tax in align geographic shift Lastly, business mix our is was tax our of provided of adjustment which The rate the July income. effective the to and reflects we revised XX.X%. a to estimate modestly tax our due forecast full XX.X%, forecast rate year than rate with year-to-date our adjusted in year quarter higher full an third

to ongoing plus Turning to comprised $X.XX September, earnings of which per $X.XX share for $X.XX earnings year, quarter. we We the fourth of year-to-date guidance mid-single fourth share ongoing organic testing-related of total our quarter. to sales XXXX be forecast per growth, excluding is now full $X.XX, outlook, in sales company for impact forecast results digits our for the of COVID the to the the through

that, sales the of nutrition single mid-to-high COVID Excluding open exchange testing-related the in Diagnostics, With COVID by impacted the X% not impact includes U.S. by unfavorable fourth COVID for we disruption, does not a questions. on the based sales which expect digits for our disruption. combined million, quarter Devices, rates, of an call fourth fourth approximately temporary excluding on we forecast testing-related testing now approximately We lastly, growth our current impacted sales have Established businesses, to be quarter. we forecast of Medical And remainder Pharmaceuticals, which surge areas sales of quarter manufacturing the organic the and in reported $XXX sales. will to assume

And comes first Instructions] question [Operator from our JPMorgan. from Robbie you. Thank Marcus

open. is line Your

quarter on. year so of with are and with the are in on maybe Congrats to taking many pieces the the currency and next thanks and COVID so shifting questions. XXXX for and think we start, really towards people’s both assumptions down moving Great. could end inflation revenues Oh! and I and P&L we Robert, the already attention just testing

provide can narrow the hoping great? you year, early this would Thanks. us help be in was the I give next some sometimes year, on anything point thoughts to might outcomes you us of range So at

that Sure. call here topics, to So, it, on challenging, macro into think right? framework I you don’t going forecasting those going can anybody path kind play growth mean, broad But Robbie. conditions to in planning of lot of impacts of better, would the for the right? kind much with a macro I I as this still I growth we are here could you next businesses. have don’t digits say opportunity our probably get are next give been expect very a our in going for of There’s of So we are right? right that of year, just headwinds and my mind to and business currency portfolio. across up, remain here. and the is year high-single all I Obviously, see us. that kind get spend are our I’d Those will inflation, two I big there right? is clear at talking variety of whole as a say, a I provide about I can now ease specifically, probably with for the topline for looking

got in and So we have products a that lot have we launches Medical upcoming launched. of Devices,

sure globally kind our probably year terms next more system, in could So we of launching rattle Libre be Navitor, there’s here mapping catheter U.S. the next year ablation market X, devices. to off expect Amulet, of Aveir, I new I launching also. EnSite CardioMEMS, a am here X, that the into in

think I nutrition. obviously, kind expect then very that are we growth strong next rate capture strong year. continued core in share seeing to U.S. are a looks in Diagnostics, portfolio and same recovery as seeing I we infant the that the expect see go in into So we device of I EPD.

third single-digit I just where COVID. third in the the how and businesses that said, here last is the of in in COVID COVID, Robbie, those that probably see perform are of and growth launches you COVID summer billion, looking over that go I number and with other couple the of months about got here right, testing of have talking mentioned so an performing you think the the how piece Many path been like we at clear COVID. the one, $X.X high that’s excluding business, single-digit upcoming. sustainability So, the billion writing quarter, we a away the in we years, you and Then will are interesting they growth high $X.X quarter. based will

we So -- how that look few as I like. next think months see to want I look the

terms I think our Bob comment for of in QX. a made forecast

we XXXX. stickier We haven’t that’s assumed. forecast of and surge. it’s for like really kind I right to QX most endemic now it’s forecast COVID think planned that sales for will of than looking the win more -- endemic a have see I into It’s But big are think like an test going

are as the So at Down those look on have cost taking going a topline. I be components to are structure. our close the P&L, the said, we

been. have We

be get that going We and investment sales those a the the have laid through kind leverage the areas have healthy the to falls the made through, Those it’s at the we are investments out falling we say, we over years, know I’d at, growth. historically. growth increased and good out you of that those Rob see I pretty margins. that is through that last leverage growth going made high got invest comes looking have lot and in to way investments couple dollars. investments. to get We the to And topline, about of am of able of talked

drive run Fab kind at a of X Alinity looking have got written billion These to early for growth of receive I since are, I XX% in of think and there was those the where us. to past contributor TriClip, CardioMEMS class again, a and their growth innings products, $X.X a growing have of kind an are call Aveir, the will the products guess, still a I be investments of of you rate would and are LAA. the annual think big about combined Navitor, But them able also those lot and the three of in they about big MitraClip, I of of Abbott, driver growth. new we Libre,

investments where will investments made from to we So and have other that past. the our managing leverage the then in see are our of invest, look structures at will the areas, areas and we and P&L the continue going some in choosing to the we we

to nothing still has true, go attractive. are is we everything very XXXX, that I’d into markets as say say fundamentally So changed, our

very high activity. markets. like ongoing in positions We these large, of growth have and upcoming a and I have the pipeline got launch lot got we leading

So that, I’d say, hasn’t really changed.

obviously, And to and inflation mindful, have we have. challenges to have the be cost are a top We the pressures FX that, sheet. some structure of then of of strong balance going we of on

We have of talked about go flexibility lot strategic next as that and that provides us and a year. financial we into

here characterization XXXX. So of version probably the in my that’s best condensed

one maybe fourth the bit helpful. for little guide That’s Bob, than quarter implied lower in really And came a street. the EPS

bigger much a headwind. FX saw also We

third to next how start us year? quarter, about be in rates what’s a current impact if the into considerations. topline our and about in fourth about gave thinking we at So year, the FX for we bottomline we lot. should think How thinking next models the heading implied do quarter Robert Thanks

Yeah. Certainly.

of significantly pound, So dollar as throughout this certainly here. are quarter. unique so certainly headwind not in current looking underappreciated more the year there fourth Robbie, good And where something multinationals but match to moves the to market a us. in yen, impact a as of in And biggest terms particularly the dealing the what strengthened third in always the appropriate. with bit of program price not impact of for About we can are other bit here year cost, alone a year I developed can, been is have if be our currencies, and seen including quarter parts, This just is try feel there’s of year, the that going earnings. in little a little we this really these be best $X.XX to the and mitigate give have two at limit most, think, euro, are to and headwinds We flowing $X.XX should the you all, terms three quarters the in into full first that maybe the rates, quarter is pretty that to than headwind done. the fourth next hedging take magnitude We certainly happening year. of that’s are moving so while our terms

contemplate January provide that we and we always guidance currency do will in at earnings will rates time. our We as

Thanks a lot.

Thanks.

moment you. our for next question. Thank One

comes question next from Our Wells Fargo. Larry from Biegelsen

is line open. Your

going quarter start wanted lot basal with Thanks me, for the Two CMS. Good X was Type the exciting for first, this Obviously, morning. LCD the product-related from news taking a there, question. to Libre, Robert. questions I on

So thoughts I’d opportunity. love to hear that your on

resolution that back suggests additional envelope opportunity non-insulin and -- and that remarks, one any agree. Our your have five any on years. to a I’d Libre was billion And just if the want patients on hear talked of math Abbott of and that the could lastly, color for vitamin follow-up? C you catch timing be you prepared did you $X did provide about love in in color I I interesting to

catch-all the question. That’s Sure. Libre

the me Let take CMS one.

are exciting I So terms with will cutting of them think it if a actually to it what covered U.S., maybe is model, But and of aligned in it this about in I team. is are CMS. mean, very But got I more is in you second. basal why about pretty you X short do probably third patients my significant. team million think by indication a tell you and my I your we could the

time terms going going it’s and of take probably this the to cetera. to timing make the to implementation of is CMS and et for the amount in decision So comments be then date, of public

But will that patients expand probably a million I second probably XXXX of one determination you makes CMS, the by move So It’s private to pretty X.X market. as natural coverage more and say. that on going a this there’s item, into flow it’s then CGM know, then commercial is Larry, CMS would significant. half about

generation we this Listen, get the it’s in coverage of So think of opportunity of have perspective evidence from at because I and that the proposal. I data that patients this to million ultimately -- the the we am have X looking up surprising not coming been from leading of have and sort support potential technology. benefit will to some

to lit the been Type Type studies, segment done I studies with Type basal the studies think those and studies on you all non-insulin CGM do and search of that if X are then have X and at between and on that head see you going a study. studies them Libre’s of pump X all

we part this your proposition population. to value that investments the is clinically primary that predominantly primary This I a will care of been then evidence whether where Libre know think saying, Europe, we it is So U.S. the have the broader show market I care in where, model very just has, segment around the with and that. call be I share in think, the primary have this we U.S., in us, it’s a is specifically a disproportionate of DMEs this how I do or provides making point, able it and scale, is a that drives care, think to what benefits And well.

XX% If you taken has class, audit by about Libre of do prescriptions physician Rx. care of the primary share market an

team on So that. the been working has

think market that’s I been it, not the of opportunity. is our market sprinting CGM enter I this about into kind contemplated a much we and has than of from part the what strategy right? at historically it’s So notion are as of quarter-to-quarter. We looking fuels And has thinking this moment think larger been this a great

million rate. are and Diabetes on manufacturing we We investments the term looking users in is franchise We $XX the product. believe over at sustain We the able believe by announced quarter Care, making growth XX kind long XXXX. this million and have for a also capacity pathway this this this got that to we of XX to billion between expansions be because

lead what are our clinical scale, our to to a opportunity able significant believe our intend our and manufacturing, investments commercial we our So I service, infrastructure, be we growth is resourcing support that. to

appropriate at completed have will growth I of the Yeah, recognize important, time. I I this medium-term kind think that us. your an short-term, other work driver C. updates would question I the the call, on vitamin we is provide vitamin for do clinical C. was on

be Type X pump franchise, If you think basal, to and about going our it’s about integration.

two that regarding next those to looking So years, I beginning at think years outside growth of an our numbers, of longer then I’d And sustain franchise term say, of drivers. get three and diabetes in core that then kind forward. announcement made our key this of year more on going of to Lingo growth this the will

So we be made good We I the have results once there. we have the feel updating study. to about update something and will

We are working on and end next benefit year pump our of integrations a outside the pump United Europe in countries. going States one to and we year, base launch integration partners pump our beginning think into have user we those from this lot with will have by a they of I that of are

was that super helpful. Robert,

Just registries the the that for the haven’t your know the launch in your seen at showed Pascal we get Thanks I to specifically, Pascal. durability much. love MitraClip so locking TCT reaction on thoughts this with the in they we my on update about to follow-up, issue just and I’d data quarter? U.S. greater and the any effect heard

Yeah.

at there’s or an a it approval. of wasn’t expectation Every time always unexpected. So landmark an study TCT

about So one the of third a approval smaller that They That’s DMR. market. the unexpected. of for got wasn’t indications,

MitraClip U.S. on We done has be and trialing a years. see for portion a to good have share. much internationally stick. how couple Internationally, question held our I the to competed to is in very going have already it Pascal of we is going well the some with expect to and of

XX-XX think Europe, in split. are at I we of that kind

the do So to dynamics I -- I U.S. expect MitraClip of in I very think well. some and here going play think to out those is

patients. think set, was -- mean, data was it the or it XXX Regarding I I yeah, XXX

of mean have We we do I I done patients over and XX in have implants, X,XXX over have on think we it Larry, data XXX,XXX was the products. our maybe great registry. MitraClip. versus got

I data now. small data the the set right is think -- pretty is

So on working are our we side.

are clinical investments in trials, We our product MitraClip. our doing investments in advancements in

and is we going a to biggest think, now, driving I expansion are indication. think that of opportunity be right FMR with the I the lot market

at last COVID said as that one regarding looked the have I I think benefit was I was indication the being think, in the we NCD. this not impacts I biggest of for the and portfolio FMR me call, able to our

market the So network have biggest opportunity referrals working get I driving further expansion. think demand expansion set up is we for those and that’s that and to

I mechanism. it’ think had we action back going I haven’t far any think normal. I we field that’s a and okay. of So think to took -- a issues, Yeah, so locking I supplies had kind

Thanks much. so

And Wuensch come you. Thank will our from next Citibank. Joanne from question

Your open. line is now

further? and about thank MitraClip MitraClip from looking than demand a stronger off How bit this is the segment much question. bit think little developing taking you double-digit jump little that like I’d the to versus else you a for for. and in morning of we were versus bit that Portico maybe Structural Good for something the and do a how little Heart and conversation growth try peel apart quarter

I we to Heart this really have us important and go I franchise. St. all even Well, the Structural acquisition we back of think, Jude mean, portfolio building when was Sure. about for way how talked the the

doing had intentional about internationally. about good had been bit in that. We have a had That X%. quarter. double-digit impacted we double growth growth U.S., the of little almost a a So digit MitraClip but was -- we

of on if could see then a to So impact of portfolio. they the other have parts kind portfolio some starting the -- that as now of stronger into are are Joanne, they of back gaining that, the scale, in kind starting to you are you

to Portico, it pretty it’s continues I you internationally, Navitor do well. Navitor in very I’d mentioned and for probably Amulet us say, So more know and but Europe well that did

market in share that two we acknowledge we we we got done accounts behind are have We say, mid-teens. making well. in X%, investments are that have say and and Europe we close about actually of it’s the -- Navitor have as I’d Europe, market I In we X% here, leaders an but pretty kind the are to

expect the with So you filed bring what market to very and competitive also. and looking here that the forward there the year. to are talk can kind we and Scott, we seeing bringing We next Amulet about it of first half the are U.S. is in to maybe here to that we of product this FDA

Joanne, the last as component would it say, I’d well, that’s basket continues as U.S. lot Structural it the mentioned, is very driving particular, traction. to Yeah. go a adopter the Robert being of that. the accounts Launched late growth Amulet In early started business in a of kind that I Heart of in say, nice of there, remaining year.

just XX% you deeper It to in an position a that share are achieve opportunity those have this Our doing there you adopter strong in and really in can get of point. some those at get early is share kind accounts you once we shows penetration that accounts. drive now and around and experience

we as go portion this over forward. thing will the of first look the accounts year, to we we do added have same with as So them

Robert opportunity that in great Navitor kind seeing is MitraClip. a Amulet are to there, opportunity of I you now said, growth to and build, TriClip, seeing nice and of what driving here for with and growth along like long-term So said, other like addition items handful are a the the

or you. of helpful? see be recovery the you do Do the returning give the things remodel your segment could As rate up? is, growth about back share one question, supply you us percentage nutrition, to once of forward any guidance we in about yourself just talk market how that my back Thank or the follow-up investors good of is would with a in taking you think

have a of program, like the like seen And terms your focus -- those to we key say, have consideration of in say I’d to say quarter this with your share we WIC recovery would hospitals. of call in is this to non-WIC had terms on the share that the think and with pediatricians this, about other and the channel network ability call have have would it’s than would there’s of channel. process. doing back I have of your you the Sure. continue supply on in challenges when is have channel situation channels. a things competitors WIC disproportionately couple global in in situations and lower at the -- one our we And XXXX Joanne, looking priced I focused than gone a we the share modeling, I those

supply a prior overly commitment to I comments, states that in that made So backward like actually in had we WIC our gated would had. we that’s they the and the contracts states my the quarter, that this We what just volume supply WIC a supplied to to we the of take was the the take where mix to recall. shortages. made opening -- not we probably market have those and It’s towards that said decision we the months three supplied

and So us And think a contracts we next place, base put to we focused quarter. on we that. live as into for quarter I that, focusing that go on going that’s commitments to and obviously be the our this not only by but into we in

recall our you read points and share September probably at in data, the if from say, saw we got back. of that think you I that it piece we the the recovery, XX go mix last So do -- are lost take share channel And about was half I and Nielsen the look the mix see I’d we to all have going will this non-WIC a the on non-WIC the WIC share we moving it start where into now our to configuration. side, capacity recovered and is with of

that I are we work we our said, that, supplying teams I month-over-month. to intentionally just in these recovery decisions made have share doing are of doing, the like, by see we build terms will think the naturally the market start how So and with

that’s about how to it. So probably think

Thank very much. you

moment And our Cowen. question. One comes from Josh Jennings question our from next you. next for Thank

open. is line Your

to forecast where that would utilization and you in if provide commentary just of base the place base impossible the can about COVID morning. XXXX wanted in to be and uptake know franchise what share XXXX? Thanks could that I are strength Robert, that but anything XXXX and testing can any like contracts just have the I and contracts taking for for ask there’s testing over follow-up. Hi. the year, look for there of COVID XXXX. I questions. into terms helpful weather Is you or about could in Good X thinking next it’s XXXX in comp roll

Yeah.

obviously, that of as spent looking high they market at this. the we of the government that’s bit rate contracts to kind little something volume of think I because contracts, ultimately, and time a between are government is non-government those contracts -- skew and run doing, year they, trying lot a are this run kind we rate of

government number, a So look the $X.X without we across endemic what the QX any that number not you state, across at that forecasting billion if in So in do I right? saw kind year, number, that season really world, significant last an call would our all QX of about surge winter we forecasting have we of our our is platforms, necessarily contracts. are

realized need make Now level is they have and some some to do inventory investments to hold countries. they testing need do in what that of governments their

active an and to a scale Abbott’s fast. governments, recognize conversations lot with realize we and ability up So of they up scale have and pretty

capacity the work and They have they know very of determining new cetera. the the got in and know with variants, our COVID of terms well we value So plenty that. et of -- They product.

have that supply reliability we we endemic have and testing, they that. So realize kind -- standpoint. and rate of in product that if run the -- from don’t that’s and in an this surge to of do the got of product, XXXX need there governments the any the know kind we year, is we And more of right got got reliability significant procure think QX the if we a have of they have number

So we are position in good there. a

Excellent.

was platform, full I share are of taking the and for up prioritization And all iCGM wondering this any the in a that, the status clinician one in sentiment you X questions. the just if CGM of terms decisions then could could thoughts side to just inflationary new that of of on any the for understand particularly on thoughts will Libre be achieving the pricing considering path Libre, sentiment on -- Just there’s potential you you formulary payer how segment pricing? Libre. impact open on follow-up your the to for accuracy But other there whether mentioned environment? Thanks towards

important or segment, are the potential and syringes Obviously, majority of even the an vast of people are segment. is injecting we using CGM is future vast right? users insulin, this this or But either that right? recognize users listen, that majority Well, pens insulin with not Sure. important an

Libre So said, -- on we like I vitamin we the C. doing completed the X regarding are work

as than there that We integration, in agency. sort through have opportunities that and believe potential the pump integration. added earlier ketone innovate in But go I So go-to because insulin does of ketone to levels June, to that -- terms the ADA measurement believe pump what will our have which the we in there’s creation environment in rise partners call. is further analyze the some be sensor pump key ahead added if market all And that about also feature that an sensor. of and terms process guess, provides the to this the be in the even continuous for sensor, level is clinically to, we delivery a I it will able that would last feature pump, is announced and ketone level, for right? the updating step a with this interruption levels a provide, -- pump referring guess of to that functionality I we are right? that We I understood safety that of you I Everybody is in at is be think ketone glucose glucose innovation, that the dual the ketone this the you that from would spoken talked safety are required, be integration

is the Freestyle best-in-class and FreeStyle FreeStyle Libre terms MARD. mean even I mean, a in X, It’s clear think, I but I accuracy, accurate the of X sub-X X. sensor. only Regarding very Libre the being it’s commonly data definitive Libre CGM understood

issue. think don’t I So we have that

important goal So provide and and advanced -- segment more in actually we to and our that’s something are even are we it’s to more investing to going beneficial. it an going be is

reimbursement now. with Yeah, but internationally. pricing volume with a we Josh. can pricing international decisions markets get the challenges the in U.S. And those we as have pricing, Sorry, either the X in the and U.S., Libre the did Libre X practically as have Libre pricing, I even Libre more it’ question year, it’s you X lower we said kind right another --oh, And to copays that, or that last on can same, think we strategy, have pricing. all the on parity or people pricing, of COGS, more formularies X,

itself fine-tune value it’s done and single-payer prove out our amount. at very clearly as strong to their that systems think either to look I proposition and more is less the with get going or budgets to how with same very start

that that think friendly no complete I with our So a pricing proposition, consumer product accuracy, strategy, I value real best-in-class our set and it’s gaps value feature prop. think,

it. Thanks, Robert. Appreciate

question. for question from moment ISI. comes next our Evercore from Thank Kumar next you. One And Vijay our

Your is open. line

headline we The I in and it’s chain of a underlying rate, growth guys. the Germany there for an singles. taking organic one think, where Robert, you impact, my organic some underlying environment within X%-ish you. these is you back no supply When Hey, first headline maybe Thanks out for low my question. the ex-COVID nutrition, mentioned the get organic was what when number. can and mismatch was clean to XQ back

about normality? So just talk that to cadence maybe

impact It pretty mean they had in and -- kind had, the supply that. are say more would was have that that more saw mid-to-high be transitory challenges high once all I’d have say, business. the we it’s this I don’t or the that I to are from we exclusions. are single business. issues doing are chain, you they fairly, Med the do they challenges isolate sustained single and the they able Med had to perspective, they in our like kind significant in quarter those are it’s regarding what get important issues Device and of of what we are I the Device issues a I

think would and we you I EP, and think these was that orders if X had get orders the this part high-single the as that of into we question back the and next sales year, of we year COVID we that whether mean, I we But than here we of as last did when Libre in kind we impact will back you bit as so see determining that growth do high I on the close had what look base that play be -- Yeah, kind single-digit see an of mid-to-high is next we I and becomes back back think I to some company. the of digits, of becomes for normal out the year, it of to out test organic? non-COVID will move your rate. a is single but said, you COVID COVID kind it smaller high at question, challenge COVID issues amount if overall once had, do this much into little probably this COVID that growth than very there, just of year. Robbie’s year, in will digits same of But smaller I factor but base overall year. be

inflationary what That’s side, wondering helpful. Q-on-Q, And the the think, down FX am I maybe impact. I then were margins incremental gross was financial one on

year of you. impact an for next and and not here about in next QX, Robert to not talk XXXX? Shouldn’t incremental $X.XX of should sure and Lingo. $X.XX think to Funck mentioned we be for about year? FX Thank impact how that inflationary am that think we I annualize FX impact I driver didn’t FX

first. rates expect Let currently fourth for going are first in are the you we be quarter take but mean I of at the next that and quarters, will the to year. fourth necessarily through exchange at. would that in you that that, certainly, kind then the those year of see me, full to impact Vijay, take I quarter I wouldn’t extrapolate the But, $X.XX X

others impacts biggest So, manufacturing impacts a the be cost is significant inflation, around headwind but Like have it we again, to us the other seeing going year. input On logistics. really are definitely, commodities, there. next seen is and we for

about in our have $XXX We impact to guidance. another current incorporated margin gross million

year, about a it, more than call gross XXX, margin. $X points for basis that’s little the so the probably, So XXX billion maybe on

as given little earlier Kind us are seen to the have over way we in said, Robert to where purchased as us and course -- manufacture increase when of our a rate start the the price down even pressures definitely we these next inflation inventory impact trying year kind into is we were hit this come we year we year, really in this some more facing businesses. that the has to and that the of in that that take the bit of year compared As higher at of offset inflationary negatively we third of to next quarter inventory will if sold, costs in consumer year. get moderation

question your launch Lingo, On a into Vijay, on factored have in next we year.

factored launch U.S. not have that here We in the

about So here of to of on come it are gates the model a direct-to-consumer subscription in is we an as international wellness that talked out launch. It’s business and more target to I it, QX. model, a different

a We are would a into, little challenging of bit going environment. call, to be what launching I

still from have, environment, with think, have the I into but in into in do opportunity have But said, the a challenging I it think we growth next We of launching and the here. platform for a to model do that subscription-like growth then think a I is wellness there. long-term like that it’s factored that beginning this thing us. perspective. that we taken building kind we building of in will from the we year year and right probably a be But launching, I scale the great have built consideration of So the long-term opportunity business,

Thank you, guys.

will we question. more one take Operator,

take And we of Travis from will our America. Bank question Steed last you. from Thank

Your open. line is

see taking to coming Hey. VBPs that want do next There’s see recovery any question. shaping you Thanks be another I headwind ask the and to did China, up China? the new for year in going on there. how you up

to Yeah. going headwind. is a It little bit be a of

either as VBP. it and about think can currency You

We gone business. parts other of our through in this have some

expect this here play value-based or we pricing So out. do to procurement

are we that area next the think looking at. I

that’s been in a and the at probably up. interesting there’s stents year That’s these we year looking with terms ranges Electrophysiology are the We have interesting, that last area side. this, as through probably we or category have next the ago pricing. of looking of it impacts next gone half on and at is definitely It’s

the exist participants actually tend regional gone in that a XX% some in XX% of or really and the have national it to also. will process, We on it’s And regional depends whether lower, also be categories magnitude range here of It number more from in the pricing. and on through a some bit that of have been to it terms category. of depends they pharmaceuticals little

the on So have as like are -- system I based that at seen approach, when there EP a more look side, we Travis. -- also system

of the So on the support a that, versus I to higher of to that think end associated capital, range. tend be and think on support be about those that infrastructure end range little bit the lower the technical

[ph] contemplated So EPD have VBP on what year got the we for that’s probably is -- next more the on more EP side.

end need you and if are of to or over to if called, growth to of No. to M&A as kind how augment still that high it at That’s environment call Fab yet the if And is ask device come do helpful. the I it you also relates up longer able M&A the growth did too, X, the medtech want to of term, hasn’t about device on enough with this grow time? your and since thinking you

because I single-digit pretty say and has we all in about and assess have to strong actively do did last we this going a financial going be about that been the sheet to we to make are a of still balance going we I being a that we are just call from the and consistently on that that got strategic perspective it opportunities from No. we as perspective. to that sure M&A increased able high are have prudent need The I don’t But we interest. said, are feel interested that growth about I here. have lot we a flexibility, sustain are have we interest and posting devices.

up call in what just and so will But I I need probably these would side I see can that stabilize would on and come valuations think, M&A. environment little down and the engage obviously, a think the financial they to valuations attractiveness it. modeling pick bit helps as say meaningful terms of of from I those you here discussions So, stabilize, that here somewhat you

we need of are we lot in that framework to to strategic a for are there So Don’t financially look of But a we in and there’s consistent do terms how of us okay. apply out good M&A. opportunities going disciplined that, position. and at

Great. Yeah. Thank you.

Obviously, here. just the So us, probably, I impact most orders probably and the of of very quarter will back sum some we was that inflation headwind. a encountered supply was our up QX chain and for challenging challenging. a

challenges year we the execution of of also. be delivery, evidence portfolio the those will the and as strength only But through you all full coming quarter our also but FX forward that, headwind. in for the a Some here the go year here saw and as raise also full not

allow on also in strengthen to talked our and position and our lot single-digit so some organic recovery allow a strategic growth institutional that and highlighted a I pipeline choices, are path and our see to high prepare clear some be decisions bit make for to businesses our There’s strengthen shareholders us and opportunity we Robbie’s to a we here a comment into have XXXX. an our us and that build fuel little growth the and I to of to guess our a future acceleration. I in sheet choices us opportunities in that our to to we is strong balance build XXXX how sustain about shifting have going to revenue and made a how business provided of and the we also that momentum. it’s going So top got we here beginning deployment growth to very about balanced capital growth. to that’s everybody and then got strengthen momentum and able for here position saw we go nice I XXXX as and

am that So, going up. that, to I Thanks. with wrap

you after a.m. A thank and your Operator, joining concludes now call call. abbottinvestor.com. XX Abbott’s us of conference Central of be this questions. This for Thank Abbott’s all for Time will you on today. at website you, available webcast replay Relations Investor today Thank

Thank Thank for you. participation. conference you call. This concludes today’s your

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