Abbott Laboratories 2013 Annual Report Download - page 69

ABBOTT 2013 ANNUAL REPORT
67
FINANCIAL REVIEW
• SUPERA Veritas self-expanding nitinol stent system which was
acquired as part of the acquisition of IDEV Technologies in
August 2013. With its proprietary interwoven wire technology,
SUPERA Veritas is designed based on biomimetic principles to
mimic the body’s natural movement. It received CE Mark in
Europe for treating blockages in blood vessels due to peripheral
artery disease (PAD). In the U.S., SUPERA Veritas is cleared
only for the treatment of biliary strictures (narrowing of a bile
duct) related to cancer. It is currently being reviewed by the
U.S. Food and Drug Administration under a Premarket Approval
application for treatment of the superficial femoral and proxi-
mal popliteal arteries, which are the main arteries in the thigh
that supply blood to lower extremities. Abbott plans to continue
development of SUPERA’s size matrix and next generation
delivery system.
• Coronary and endovascular guide wires. Abbott’s HT Pilot and
HT Progress guide wire families received FDA clearance for the
Chronic Total Occlusions (CTO) indication in January 2013.
Medical Optics — Abbott is developing a number of new products
for patients undergoing cataract surgery, which are designed
to improve physician efficiency and patient outcomes. In 2013,
Abbott’s Tecnis Toric monofocal intraocular lens, which combines
the optical qualities of the Tecnis design with astigmatism
correction, was approved in the U.S., China and Japan. In addition,
a preloaded version of the Tecnis 1 piece monofocal IOL was
approved in the U.S., Canada and India and a preloaded version of
the Tecnis 1 piece multifocal IOL was approved in Canada, Europe
and Japan. Preloaded technology enables insertion of the Tecnis 1
piece IOL with an easy to use, disposable insertion system. Other
products that received regulatory approval in Japan included the
Tecnis OptiBlue monofocal IOL in a standard cartridge insertion
system as well as the preloaded version. The iDesign advanced
vision diagnostic and LASIK treatment planning system, previ-
ously approved in Europe in 2012, received approval in Canada
and a number of Latin American and Asian countries. In 2014,
Abbott plans to continue to work to introduce new products,
including the launch of new pre-loaded IOLs, which are designed
to improve the ease of use for the cataract surgeon.
Molecular Diagnostics — Various new molecular in vitro diagnostic
(IVD) products, including oncology and infectious disease assays
and a next generation instrument system are in various stages of
development and commercialization. Abbott’s companion diag-
nostic test for an ALK gene rearrangement test for non-small-cell
lung cancer has been approved in more than 69 countries around
the world and now includes options for automated processing and
image analysis. Abbott’s companion diagnostic program continues
to expand and includes collaborative efforts with multiple major
pharmaceutical companies. An automated assay to genotype
HCV-infected patients to aid in the choice of an appropriate
therapy was approved by the FDA. In addition, automated IVD
assays for Flu A/B/RSV, C.difficle, and VanR were launched in
many countries around the world. Assays for infectious diseases
including MTB and MTB drug resistance and for oncology includ-
ing KRAS and BRAF mutation detection are in development.
Core Laboratory Diagnostics — Abbott is working on the develop-
ment of next-generation blood screening, hematology, and
immunochemistry instrument systems, as well as assays in various
areas including infectious disease, cardiac care, metabolics, oncol-
ogy, and automation solutions to increase efficiency in laboratories.
Diabetes Care — In the third quarter of 2013, Abbott received
CE Mark in Europe for its FreeStyle Precision Neo monitoring
system, a new icon-driven system with visual glucose trend
indicators and insulin logging. In the second half of 2013, Abbott
received both CE Mark in Europe and FDA approval for Precision
Pro, a hospital glucose monitoring system which provides
improved accuracy and dual-band wireless access to immediate
test results. Abbott is also developing a new sensor based system
that it expects to submit for approval in Europe in 2014.
Nutrition — Abbott is focusing its research and development
spend on six benefit platforms that span the pediatric, adult and
performance nutrition areas: immunity, cognition, lean body mass,
inflammation, metabolism and tolerance. Numerous new products
that build on advances in these benefit platforms are currently
under development, including clinical outcome testing, and are
expected to be launched over the coming years.
Given the diversity of Abbott’s business, its intention to remain
a broad-based healthcare company and the numerous sources
for potential future growth, no individual project is expected
to be material to cash flows or results of operations over the next
five years. Factors considered included research and development
expenses projected to be incurred for the project over the next
year relative to Abbott’s total research and development expenses
as well as qualitative factors, such as marketplace perceptions
and impact of a new product on Abbott’s overall market position.
There were no delays in Abbott’s 2013 research and development
activities that are expected to have a material impact on operations.
While the aggregate cost to complete the numerous projects
currently in development is expected to be material, the total
cost to complete will depend upon Abbott’s ability to successfully
complete each project, the rate at which each project advances,
and the ultimate timing for completion. Given the potential for
significant delays and the high rate of failure inherent in the
development of pharmaceutical and medical device products
and technologies, it is not possible to accurately estimate the total
cost to complete all projects currently in development. Abbott
plans to manage its portfolio of projects to achieve research and
development spend equal to approximately 6 percent to 7 percent
of sales each year. Abbott does not regularly accumulate or make
management decisions based on the total expenses incurred for
a particular development phase in a given period.