With strong leadership and a taste for risk-taking, outgoing CEO Miles White left no stone unturned as he grew Abbott into one of the world’s largest medical device companies.
Few medical device companies have seen the growth and transformation that Abbott (NYSE:ABT) has seen under the leadership of Miles White.
During his two decades as Abbott’s CEO, White has grown the Abbott Park, Ill.–based company’s annual revenue tenfold — to more than $30 billion. What was more of a pharmaceutical company when White took over now has more than a third of its sales coming from medical devices, placing Abbott among the world’s largest medtech companies. (You can find a timeline of Abbott under White’s tenure here.)
White, 64, will step down from the CEO position on March 31 after 21 years at the helm, but will remain with the company as executive chairman. Robert Ford, currently Abbott’s president and COO, will become the 13th CEO in the company’s history.
Abbott’s medical device market strategy under White included getting into continuous glucose monitoring with its popular FreeStyle Libre, which eliminates the need for finger sticks. It pioneered transcatheter mitral valve repair with its MitraClip device and also sells connected cardiac monitors, a recharge-free, implantable spinal-cord stimulator, and a group of diagnostic instruments, generic medicines and nutritional products.
Abbott went all-in into the medical device market in 2017, when it acquired St. Jude Medical for a whopping $25 billion. The company meanwhile spun off its research-based pharma business and its blockbuster drug, Humira, into a separate company, AbbVie, in 2013.
Less celebrated were Abbott’s $2.8 billion acquisition of Advanced Medical Optics in 2009 and its contentious $5.3 billion purchase of Alere in 2017. Abbott sold the renamed Abbott Medical Optics to Johnson & Johnson for $4.33 billion that same year.
So how did White do it? Analysts who follow Abbott credited White’s strong managerial style and operational culture.
“He’s known for being pretty demanding and kind of leaves no stone unturned,” said Matthew Taylor, a UBS analyst who has covered Abbott for five years. “I think there’s really no place to hide at Abbott. You need to hit your goals and be ahead of the market or you’re going to be on the hot seat. He really keeps people accountable.”
That said, Taylor believes that Abbott has good leaders in all of its divisions and long-serving staff. “A lot of people work at Abbott for their entire career and that’s kind of a rare thing,” he said.
Taylor also credited White with doing a “tremendous job” in growing value over the last 20 years. “He’s been fairly creative around portfolio-shaping” especially in the medical device division, the analyst said.
“When you look at where their growth has come and will come from, medical devices is growing the fastest of any of the divisions, and we expect it to grow double-digit over the next few years when the market is growing single-digit,” Taylor added.
Analyst Vijay Kumar, managing director of Evercore ISI, characterized White as a “very, very strong leader” who was not afraid to take “big, bold steps” such as the pharma divestment and the St. Jude acquisition.
“He has been right when he’s taken big, bold steps,” Kumar said. “Sometimes for people to take big actions like that, you need the buy-in from key stakeholders, and Miles had it.”
In a Q&A interview provided exclusively to Medical Design & Outsourcing, White reflected on his tenure and the direction of the company. The interview was edited for length and clarity.
Q: How do you feel about the growth potential of Abbott?
MW: Abbott’s growth potential today is the best I’ve seen in my 35 years with the company. We’ve built the company very deliberately, through a multi-year process, to do just that and, consequently, to deliver superior results for years to come. We’ve shaped our businesses to align with where the future of healthcare is going to be. We’ve also greatly expanded our internal R&D capability. As a result, we have one of our strongest product portfolios ever.
Q: Is your confidence based more in the lineup of forthcoming products and services or in your acquisitions or talent development?
MW: They’re all interlinked, but the primary factor for any company to grow is to innovate: to be in the right place with the right products.
Q: How has Abbott’s approach to innovation changed during your 20-year tenure?
MW: When I became CEO, our largest and most profitable business was pharmaceuticals. This became even more true after we introduced Humira, the world’s best-selling drug. In 2013, we made a big move, creating AbbVie. That proved extremely successful. We’re now a technology and market leader across a range of medical-device businesses. These products, and others in our pipeline, are focused on some of the world’s greatest healthcare concerns. Non-communicable diseases – such as diabetes and heart disease – are chronic and long lasting, and they’re drastically increasing in prevalence around the world.
Q: You have said that Abbott has a strong performance and servant-leadership culture. How have you been able to maintain those aspects over the many reinventions of the company?
MW: A strong culture tends to be self-perpetuating. It draws people who are attracted by it, it identifies people who share its values, and it reinforces those values through countless actions and interactions every day.