Recently, Abbott said,The revenue of the diagnostic business in the third quarter decreased by 33% year-over-year on a reported basis.This is due to the anticipated reduction in COVID-19 testing. Excluding the impact of COVID-19 testing, the company's diagnostic sales increased by 9% on a reported basis.As of September 30, Abbott reported overall revenue of $10.14 billion, a decrease of nearly 3% from $10.41 billion a year ago, but surpassing Wall Street's expected $9.81 billion. The company stated that excluding the impacts of foreign exchange, exiting the pediatric business in China, and the acquisition of Cardiovascular Systems, its organic sales declined by nearly 2% year over year.Excluding sales related to COVID-19 testing, Abbott said global third-quarter sales rose 14% on an organic basis.Abbott's diagnostic business revenue in the third quarter decreased from $3.64 billion last year to $2.45 billion. Within the diagnostic business, core laboratory sales in the third quarter increased by 8% on a reported basis, rising from $1.22 billion to $1.31 billion.Molecular sales decreased by 28%., down from $183 million to $133 million; POCT sales increased by 10% year-on-year, from $127 million to $140 million;Rapid diagnostics sales dropped by 59%, down from $2.11 billion to $862 million. Excluding COVID-19 test sales, core laboratory sales increased by 10%.Molecular sales declined by nearly 4%.POCT sales increased by 10%, and rapid diagnostic sales increased by 13%.During a conference call, Abbott CEO Robert Ford said that the core laboratory business has outperformed the market both in the U.S. and internationally, with increasing demand for routine diagnostic tests. The company also reported a "strong recovery" in its blood transfusion business following a period of low plasma donations during the COVID-19 pandemic.Ford said that the rapid diagnostic base business benefited fromIncreased Demand for Respiratory Testing as Flu Season in the Northern Hemisphere Starts Early。The company's global sales related to COVID-19 testing in the quarter fromDecreased from $1.67 billion in the same period last year to $305 million。Ford also discussed the impact of China on Abbott's business as the country prepares to implement volume-based procurement for diagnostics in the first half of 2024. Ford stated that the initiative would cover approximately 20% of Abbott’s core laboratory business. The program will apply to certain disease areas, such as infectious diseases and fertility testing, and could provide growth opportunities for Abbott by enabling the company to gain sales volume in areas where it has a lower market share. He also noted that the company already has experience with volume-based procurement in other parts of its business and is therefore well-prepared for this process.In other business segments of the company, nutrition sales increased nearly 16% on a reported basis and 18% on an organic basis, rising from $1.8 billion to $2.07 billion; established pharmaceuticals sales grew 3% on a reported basis and 11% on an organic basis, increasing from $1.33 billion to $1.37 billion; medical devices sales rose 17% on a reported basis and 15% on an organic basis, climbing from $3.62 billion to $4.25 billion.Despite potential macroeconomic challenges in 2024, Ford expressed confidence in the company's business, stating that its portfolio has "proven resilient in this environment." He said, "There is clear momentum building… and I believe that momentum will continue into 2024."He also mentioned the company's mergers and acquisitions strategy, as Abbott Laboratories completed several large-scale acquisitions in 2023. In February, the company acquired Cardiovascular Systems, a medical device company, for approximately $890 million, and last month purchased Bigfoot Biomedical, an insulin management company, for an undisclosed amount. Ford stated that valuations of companies across the entire biotech industry are declining, presenting a great opportunity for Abbott to be in an "excellent strategic position" to execute its M&A strategy. He said, "We have sufficient capacity, and if the right opportunity arises during this period, we will be ready."
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