Abbott Laboratories

Legal and litigation · Product liability and warranty claims

Significant safety concerns could arise for Abbott's products, which could have a material adverse effect on Abbott's revenues and financial condition. Healthcare products typically receive regulatory approval based on data obtained in controlled clinical trials of limited duration. Following regulatory approval, these products will be used over longer periods of time in many patients.

Legal and litigation · Intellectual property disputes

Competitors' intellectual property may prevent Abbott from selling its products or have a material adverse effect on Abbott's future profitability and financial condition. In the ordinary course of business, Abbott is the subject of patent litigation, such as competitor claims that an Abbott product infringes their intellectual property. Resolving an intellectual property infringement claim can be costly and time consuming and may require Abbott to enter into license agreements.

Data and privacy · Data protection and privacy laws

Abbott also collects, manages and processes protected personal data, including protected health information, in connection with certain medical products and service offerings. Abbott is subject to numerous data privacy and data protection laws and regulations globally, including data protection laws that prohibit or restrict the transfer of protected data across country borders. A breach or unauthorized disclosure of protected personal information could result in adverse consequences, including regulatory inquiries or litigation, increased costs and expenses, reputational damage, lost revenue, and fines or penalties.

Industry regulation · Regulatory compliance and changes

Abbott's products are subject to rigorous regulation by the FDA and numerous international, supranational, federal, and state authorities. The process of obtaining regulatory approvals to market a drug, medical device, diagnostic product, or nutritional product can be costly and time-consuming, and approvals might not be granted for future products, or additional indications or uses of existing products, on a timely basis, if at all.

Geopolitical and trade · International conflicts and tensions

Abbott is also subject to other geopolitical risks, such as war, political and geopolitical instability, terrorist attacks and related military action. For example, the global economy has been impacted by geopolitical tensions focused on trade, which has increased uncertainty for global businesses such as Abbott. Additionally, the ongoing Russia-Ukraine conflict has resulted in sanctions, economic and currency volatility, higher inflation, heightened cybersecurity risks, and operational and supply chain disruptions.

Natural and catastrophic events · Natural disasters and extreme weather

Problems may arise during manufacturing for a variety of reasons, including equipment malfunction, failure to follow specific protocols and procedures, problems with raw materials or the global supply chain, failure to meet product specifications, cybersecurity incidents, natural disasters, and environmental factors.

Economic and market conditions · Inflation and deflation pressures

These risks include the enactment of trade protection measures such as tariffs, import or export licensing requirements, other governmental restrictions such as trade sanctions, and changes to international trade agreements; government actions such as price controls, limitations on participation in local enterprises, expropriation, and nationalization; restrictions on local currency conversion and/or cash extraction; changes in inflation (including the cost of raw materials, labor, commodities, and supplies) and interest rates.

Market position and competition · Disruptive competitors and new market entrants

Further, the development of new technologies, including disruptive technologies such as artificial intelligence, healthcare products and medicines, and the development of new treatments for disease could significantly change the competitive landscape of the healthcare industry and negatively impact the demand for certain Abbott products.

Market position and competition · Competitive pressure and market share loss

New products and technological advances by Abbott's competitors may negatively affect Abbott's results of operations. Abbott's products face intense competition from competitors' products and technological advances. Competitors' products may be safer, more effective, more effectively marketed or sold, or have lower prices or superior performance features than Abbott's products.

Innovation and product development · Intellectual property protection and infringement

The expiration or loss of intellectual property protection and licenses may affect Abbott's future revenues and operating earnings. Many of Abbott's businesses rely on patent and trademark and other intellectual property protection. Although most of the challenges to Abbott's intellectual property have come from other companies, governments may also challenge or diminish intellectual property protections.

Innovation and product development · Product development and randd investment risks

To remain competitive, Abbott must continue to launch new products and technologies. To accomplish this, Abbott commits substantial efforts, funds, and other resources to research and development. A risk of failure is inherent in the research and development of new products and technologies. Abbott must make ongoing substantial expenditures without any assurance that its efforts will be commercially successful.

Strategic execution · Merger acquisition and divestiture risks

Abbott may acquire other businesses, license rights to technologies or products, form alliances, or dispose of or spin-off businesses, which could cause it to incur significant expenses and could negatively affect profitability. Abbott may not complete these transactions in a timely manner, on a cost-effective basis, or at all, and the expected benefits may not be realized or may not be realized within the expected time period.

Market position and competition · Pricing pressure and margin compression

Abbott is subject to cost containment efforts that could cause a reduction in future revenues and operating earnings. In the United States and other countries, Abbott's businesses have experienced downward pressure on certain product pricing. Cost containment efforts by governments and private organizations are described in greater detail in the section captioned 'Regulation.'

Capital structure and performance · Credit rating and cost of capital

Additionally, further borrowing could cause a deterioration of Abbott's credit ratings. Abbott's credit ratings reflect each credit rating agency's then opinion of Abbott's financial strength, operating performance, and ability to meet its debt obligations. Adverse changes in Abbott's credit ratings may result in increased borrowing costs for future long-term debt or short-term borrowing facilities and may limit financing options, including access to the unsecured borrowing market.

Credit and liquidity · Access to capital and financing

Further, Abbott may be required to raise additional financing for working capital, capital expenditures, future acquisitions or other general corporate purposes. Abbott's ability to arrange additional financing or refinancing will depend on, among other factors, Abbott's financial position and performance, as well as prevailing market conditions and other factors beyond Abbott's control. Consequently, Abbott cannot assure that it will be able to obtain additional financing or refinancing on terms acceptable to Abbott or at all.

Capital structure and performance · Debt management and refinancing

As of December 31, 2025, Abbott's consolidated indebtedness was approximately $12.9 billion. Abbott plans to fund the Exact Sciences acquisition with approximately $20 billion of borrowings. This increase in Abbott's consolidated indebtedness could have the effect, among other things, of reducing Abbott's flexibility to respond to changing business and economic conditions.

Supply chain and procurement · Supplier operation and dependance

Abbott's operations and performance depend on its ability to manage its large and complex global supply chain. While Abbott has taken and will continue to take actions to mitigate the risks of disruptions to its global supply chain, disruptions to it could negatively affect Abbott's results of operations. For example, the COVID-19 pandemic and macroeconomic conditions such as inflationary pressures and labor shortages contributed to global supply chain challenges in the early part of the decade, which adversely impacted the cost and availability of certain raw materials, supplies, and services.

Digital transformation and innovation · Digital transformation and modernization

In addition, Abbott is developing new business and operating models necessary to support the creation of data-driven healthcare solutions such as data-centric prevention and treatment strategies, new products and technologies that incorporate data insights, and product technology strategies that focus on connectivity and data collection and management. Even if Abbott successfully develops such new data-driven healthcare solutions, they may be rendered obsolete by competitors' innovations, the nature of the data and insights generated, or changing customer preferences.

Digital transformation and innovation · Technology obsolescence and evolution

Even if Abbott successfully develops new products or enhancements or new generations of Abbott's existing products, they may be quickly rendered obsolete by changing customer preferences, changing industry or regulatory standards, or competitors' innovations. Innovations may not be accepted quickly in the marketplace because of, among other things, entrenched patterns of clinical practice or uncertainty over third-party reimbursement.

Cybersecurity and data protection · Third party data security and vendors

Similarly, there can be no assurance that third-party information technology providers or other partners with whom Abbott contracts will not suffer a significant cybersecurity incident or disruption that impacts Abbott. Any significant cybersecurity incident or other disruption affecting Abbott's information systems or products could have a material adverse effect on Abbott's business, financial condition and results of operations.