Abbott Laboratories is to separate its global nutrition business into an independent, publicly traded company with approximately $8.5bn in annual sales.
In a statement yesterday (21 October), the US-headquartered healthcare group said the decision addresses “different investment identities and requirements, growth profiles, and innovation cycles”.
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The nutrition portfolio includes infant-formula powders and adult nutrition drinks, along with beverages targeted at those with diabetes and pediatric patients.
It features brands such as Similac formula, Ensure adult nutrition shakes, the pediatric supplement PediaSure, the diabetes management line Glucerna and the rehydration label Pedialyte.
The spin-off, Abbott added, will enable the business to “focus its resources more strategically across innovation, commercial activities and key initiatives”.
Robert Ford, Abbott chairman and CEO, said the nutrition business has a “unique opportunity to capitalise on the growing demand for healthy nutrition”.
The standalone business will employ roughly 16,000 people and operate 14 manufacturing facilities.
Following the transaction, Abbott will separately operate its “core higher-growth” portfolio of medical devices, diagnostics and established pharmaceuticals. The company expects the remaining business to have approximately $42bn in annual sales.
Daniel Salvadori, Abbott’s executive vice president and group president for established pharmaceuticals and nutritional products, will become CEO of the nutrition business.
Abbott said the planned separation will take place through a tax-free distribution of shares to its shareholders, with the transaction expected to be completed by the end of 2027.
Alongside the separation announcement, Abbott reported its third-quarter and nine-month financial results.
In the first nine months of 2026, the nutrition unit recorded net sales of $6.42bn, a 1.3% decline on a reported basis and a 2.1% fall on a comparable basis year on year. The drop was led by US pediatric sales, which contracted 4.8% to $1.61bn.
By contrast, total group reported net sales rose 11.9% to $36.77bn across the nine months, aided by expansion in diagnostics and medical devices.
Group operating earnings, however, dropped 24.2% to $4.39bn, while net earnings fell 38.4% to $2.92bn, weighed down by factors such as litigation costs and acquisition-related expenses.
Last month, Abbott agreed to pay $385m to settle US Department of Justice and state claims connected to the 2022 recall of infant formula made at its Sturgis plant in Michigan.
The plant’s temporary shutdown, following complaints of Cronobacter sakazakii infections, triggered nationwide formula shortages across the US.
That agreement came shortly after an August settlement in which Abbott paid about $670m to resolve around 2,000 legal claims from parents who alleged its infant formula – specifically Similac Special Care 24 – caused the intestinal disease necrotizing enterocolitis (NEC) in premature babies.
Similar NEC claims have also engulfed infant-formula peer Reckitt Benckiser and its Mead Johnson business.
