Abbott to Acquire Alere for $5.8 Billion in Point-of-Care Play

By Stephanie Murg, Managing Director, G2 Intelligence

Abbott (Abbott Park, Ill.) is betting big on point-of-care testing. The global healthcare giant announced on Feb. 1 its agreement to acquire Alere (Waltham, Mass.) for $56 per common share—a premium of 51 percent over Alere’s closing stock price on the previous trading day—putting the total expected equity value at $5.8 billion, excluding net debt.

With annual sales of $2.5 billion, Alere delivered more than 1.4 billion tests at the point of care in 2015. Its tests are focused on the areas of infectious disease, molecular, cardiometabolic, and toxicology. The company also develops rapid tests, including the first CLIA-waived molecular test for flu and strep.

The addition of Alere’s broad and deep portfolio of point-of-care tests would supercharge Abbott’s position in diagnostics, which currently accounts for 23 percent ($4.6 billion) of the company’s annual sales of $20.4 billion. The rapidly growing point-of-care segment represents only about 10 percent of Abbott’s diagnostics business, which is led by immunoassays and blood screening.

Alere products would also give Abbott access to channels such as physician offices, pharmacies, and at-home testing as well as the opportunity to expedite the geographic diversification of the Alere business, (more than half of its sales are in North America).

“The combination of Alere and Abbott will create the world’s premier point-of-care testing business and significantly strengthen and grow Abbott’s diagnostics presence,” said Abbott chairman and CEO Miles D. White in a statement announcing the deal. According to Abbott, the transaction is anticipated to result in annual pre-tax synergies approaching $500 million by 2019.