Why Investors Should Focus on Abbott's Medical Devices
Diversified healthcare company Abbott Laboratories (NYSE: ABT) has been front and center in the news this year. Given the headlines surrounding the infant formula debacle and the influx of cash from COVID-19 diagnostics, it's easy to overlook the company's innovation in medical devices. But this segment provides a stable backbone that is integral to future growth.
The American Diabetes Association claims that diabetes is the most common chronic disease in the U.S., with 1.4 million Americans newly diagnosed each year. Abbott is a leader in the field, offering one of the most widely used continuous glucose monitors. The sensor tracks blood glucose and warns if the level gets too high or low, providing more convenient and reliable care than finger-prick tests.
In May, the FDA approved the Freestyle Libre 3, which Abbott claims achieves the most accurate measurement among the line-up of 14-day continuous monitoring systems. At about the size of two pennies, the sensor is also the smallest and thinnest. Abbott intends to maintain a similar price point as previous versions, substantially undercutting rival Dexcom's (NASDAQ: DXCM) G7 CGM System. While still expensive, Illinois recently passed legislation that forces insurance to cover these devices, and demand may increase if other states follow suit.
Source Fool.com