Abbott Laboratories executive vice president, finance and CFO Brian Yoor said at the 2019 J.P. Morgan Healthcare Conference that the company is not focused on M&A deals at this time.
During his Jan. 8 presentation at the conference, Yoor pointed to the company's pipeline and said organic growth will be the main priority of the company, not M&A. Leaning on organic sales growth is not a new concept for Abbott. The medical device maker has reported organic sales growth above 7% over the last four quarters.
Yoor's comments come after Biogen Inc. CEO Michel Vounatsos said Jan. 7 at the conference that the company's main focus is on advancing the existing pipeline, even though it has the capacity to consider M&A activity.
One product that Yoor was particularly positive about throughout his presentation was FreeStyle Libre, the company's continuous glucose monitoring system. More than 1 million patients use Libre, and the company estimates that sales will soon eclipse $1 billion, according to Yoor.
Libre pulled in $300 million of sales in the third quarter, a year-over-year increase of 100%, according to the company. Overall, the company's diabetes group saw a 40% growth in sales in the third quarter.
Since 2016, Abbott has quadrupled the number of patients that use Libre, and Yoor was optimistic that growth would continue. About 200,000 people in the U.S. use the product, while the remaining 800,000 are spread between more than 35 countries, according to Yoor.
In November 2018, the U.S. Food and Drug Administration approved a smartphone app to work with Libre, allowing diabetes patients to track blood sugar levels on their smartphones.
Yoor said Abbott recently released a new version of the product — FreeStyle Libre 2 — in Germany last year, which provides patients with the option to receive alarms when glucose levels drop too low or too high, a feature that is not in the current version. The product is the same price as the current version, and Abbott hopes that the product will soon expand into the U.S.
The CFO also pointed to Alinity, the company's laboratory integration system, as a product that will help drive organic growth. Yoor said Abbott has received a 95% to 99% retention rate among Alinity accounts and called the product the "the gift that will give for a lot of years."
Despite the company's four quarters of organic sales growth, at the end of the third quarter, Abbott narrowed its 2018 EPS guidance from a range between $2.85 and $2.91 to a range between $2.87 and $2.89.
The annual J.P. Morgan Healthcare Conference in San Francisco brings together more than 9,000 investors, analysts and executives from more than 450 public and private companies.