Abbott Laboratories (ABT) plans to lay off 700 workers amid a decline in heart stent orders. Most of the cuts come from the company's heart stents and diagnostic tests business.
Boston Scientific, which pays a 40% royalty on sales of Abbott's Xience stent, recently chose to use Promus Element, its own in-house stent, instead.
Some 300 workers at Abbott's stent business in Southern California will be let go. Less 200 workers will get cut from the diagnostic business in Lake Country, Illinois. The layoffs come as the company has been in ongoing restructuring efforts for years. In early 2010, Abbott cut 1,900 workers in its pharmaceutical division.The medical device and drug maker reported that its profit increased 12% in the fourth quarter, helped by double digit sales growth of Humira, an anti-inflammatory drug. The braded drug business, which includes Humira, will be spun off so that investors can separately value Abbott's other businesses, according to the company in October. The company's business post-split will be more predictable in that it will be free of risks associated with developing innovative pharmaceutical drugs.