Abbott likely to retain CMO biz after split

By Gareth Macdonald

- Last updated on GMT

Related tags Medicine Pharmacology

Abbott says its contract manufacturing business is likely to be part of the diversified drug company formed after its planned corporate split.

The US healthcare major announced its intention to divide into a research-based pharmaceutical development organisation and a diversified medical business, which will retain the Abbott name, late yesterday.

At present the firm operates more than 100 manufacturing facilities around the world, some 17 of which provide contract manufacturing services​ for both finished products and active pharmaceutical ingredients (APIs) for third parties.

Spokeswoman Melissa Brotz told that while no further details of the split would be announced “generally, the facilities that manufacture proprietary pharmaceuticals will go to the research-based pharma company and the other facilities will go to Abbott, the diversified medical products company​.”

She did not say what impact the split would have on Abbott’s contract manufacturing employees, but did say that: “There will be a transition team formed to look at these matters - the separation will be completed by the end of next year​.”

CMO performance

The performance of Abbott’s contract pharmaceutical manufacturing business is difficult to measure as its sales are reported in combination with the firm’s animal healthcare business.

Nevertheless, according to third quarter results also released yesterday, combined the animal health and contracting units generated $188m (€136m) for the three months ended September 30, which is up around 5 per cent on the total for the comparable quarter last year.

Within this the US contributed some $85m, an increase of 18.5 per cent on last year. The remaining $33m came from international markets, which is a decline of around 18 per cent on the amount generated last year.

This continues the pattern seen so far this year during which revenues generated by Abbott’s combined contract manufacturing and animal health business have increased 16 per cent to $366m, with growth in the US and a decline in international markets.

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