Abbott Laboratories (ABT) Earnings Call Transcript & Summary

Welcome, everyone. I'm happy to introduce the next session with Abbott, and CEO, Robert Ford. We're going to switch it up a little bit here in lieu of a formal presentation. We're going to do a bit of fireside chat. Robert, let's jump right into it.

So last year clearly did not play out the way anyone expected. The pandemic created many new challenges for companies to overcome. I suspect you learned more than a few things about Abbott during this time. And everybody remembers, this is just your first year on the job as the CEO, what a year to start. So maybe you could share with us a couple of lessons learned, so to speak, that really resonated with you in 2020.

Robbie. Good to be here, and good to -- thank you, everybody, for joining us here today. Definitely, 2020 was an extraordinary year for all of us on many different levels, definitely not the first year I had expected as my first year as CEO. But looking back, I couldn't have asked for a better year to be quite honest with you. Obviously, the challenge of COVID and the sheer breadth of that impact, whether it's for our customers, our suppliers, our employees, I mean, every geography got hit with a big impact all at once. And it reinforced a couple of key things for me from an Abbott perspective. First of all, the value of our diversified business model. We are uniquely positioned and diversified across a lot of different dimensions, whether it's product mix, business mix, geography mix, customer mix, payer mix, different innovation cycles across all of our businesses. And that diversification has historically allowed us to maximize our growth opportunities, provided you pick the right areas to be diversified, and we believe we have. But this is really the first time. The other thing we've always talked about is that there's diversification not being overly reliant on a given product, business, country, et cetera, that it limited some of the risks. But I think this was the real year -- this was the first year, at least that I've seen that we've really tested that out. And I think we've been proven to be incredibly resilient as part of that diversified model. If you look at the floor EPS guidance we gave in Q3 -- on our Q3 earnings, that floor guidance is the same that we gave in January when we really didn't know anything about COVID. And I think that's pretty -- I think that's pretty unique in that environment. I think the second thing that, again, was just being 25 years in the company, 24 years in the company, just the reinforcement of the Abbott culture and of the Abbott people. I mean the efforts that we had throughout the entire year across the organization, across the globe to be able to maintain our supply chain, meet the demands of our customers, I mean, stories of people going into hospitals to prop their cases because those are life and death situations for those patients, the work we did with our supply chain across all of our business. And then on top of that, all the efforts we did to develop and scale up the COVID test. I mean, I think it really showed the value and the culture that Abbott has, that great culture of caring and a culture of achievement. So I think that was super important. And then lastly, I would say, a key thing that's kind of emerged out of this pandemic has been the notion of remote care and digital solutions and digital health. I think that intersection between health and digital, we saw that trend happening 4, 5 years ago, and have been watching it and have been interacting and planning around it. And I think that the COVID is now just reinforces even more. Of course, during the pandemic remote care, it kind of helps in limiting the risk of the unnecessary exposure, but a lot of the benefits that you have in that remote care that digital health transcends and goes beyond COVID. We all know that it allows for much more proactive management. We see that in some of our portfolio. It can decrease the response time, especially if you've got like an urgent care situation, it can really bring that response time down lower; cuts up a lot of the logistical issues and challenges of in-person and then ultimately can lead to lower health care cost. So I think that is a trend that -- we saw before COVID and COVID has accelerated that. And you know all the things that we've done in our device portfolio over these years to be able to link our products to more of a digital health solution. You saw that with Libre. You saw that with the Confirm Rx implantable monitor. That was the first one with Bluetooth capabilities. We've just launched our Gallant line of rhythm management devices. These have Bluetooth CardioMEMS, remote monitoring also there. Neuromodulation, we're the first company to do a lot of the programming digitally. So I think this is definitely a trend that has been happening, and COVID has accelerated it and it's -- I want Abbott to be a leader and a pioneer in this. And I think we've done a good job in the devices, and we started to see some of that strategy now move over into the diagnostics area with our testing. So I think it's a great opportunity for us. Definitely, a incredibly unique period for us. But I'm proud of the way that the company has risen to the challenge. It's why Abbott was built. It's for moments like these. And I'd say we were pretty strong coming into the pandemic. I think we've exited the pandemic even stronger. And I'm really looking forward to this year and some of the things we've got ahead of us.

Well, I'm glad we're close to exiting. I wouldn't quite say we've exited, but hopefully, we're within weeks to months rather than months to years. So speaking of COVID, investors recognize that Abbott did an incredible job, starting this COVID testing business from scratch. And right now, you have a broad portfolio of COVID testing options with many different types of tests across all the Abbott platforms, both U.S. and internationally. So maybe just where we are today if you could give us an update and really how should we think about this testing opportunity as we move forward and hopefully towards the end of COVID.

Sure. Well, I think the way you started off, I mean, Abbott is a leader in this area. And I think that's that legacy that actually drove us. We were the first company to develop the first HIV -- approved HIV test to secure the world's blood supply in the mid-80s. So I think a lot of that legacy within the company and we wanted to be the first mover here. I think in the month of January, there was a little bit of -- as we saw the disease start to progress last year, we were trying to ask ourselves does it look like MERS, like a SARS, like H1N1. And then quickly, in February, we realized that, no, it's not going to look like this. It's going to be very different. And we got the team together. We have a very unique set of assets in our diagnostic business, whether it's the laboratory-based systems, the small instrument point-of-care systems or even the lateral flow, noninstrument tests and assays. So we looked across that spectrum of test and said, okay, we're going to use that asset base to develop tests across all of those different systems. The first part of the strategy was to leverage the installed base that we currently had of capital equipment that was out there. And that was mostly the PCR system, the molecular PCR system and the ID NOW molecular system, too. Those are instruments that were already out that were deployed in the market. So a lot of our focus was, okay, let's find a way to develop a test that can target the disease, can target the virus and all we need to do then is kind of scale it up and deploy it into the instruments. And that worked very well, I think, in the first couple of months of the disease. But we also knew, given our experience that in a pandemic, and nobody had the global pandemic experience, but we knew that in a pandemic, you weren't going to be able to rely exclusively on kind of lab-based systems, right? We all kind of experienced that turnaround times and then you flood that with a global pandemic that got exacerbated. So we knew that we needed kind of fast, affordable mass-scale testing, And it was in the beginning of April that we said we need to develop our lateral flow tests and said, okay, we need to be in Q3 with lateral flow tests that we can make millions and millions of these. And I'm really proud that the team during that Q2 worked incredibly hard, nights and weekends to be able to get there, and we developed 2 lateral flow tests. I decided not to -- I don't know if people see this, but this is our Binax test, antigen test that we've launched in the U.S. And then this is the same kind of chemistry technology, but in a different form factor, the Panbio and this is done in international market. So we've launched both of these systems. They're fast, they're reliable. They're highly sensitive for that infectious period when you're actually infectious. And we have got the capacity to do millions and millions of tests. And we additionally wanted to make sure, going back to that digital component there, Robbie. We wanted to develop a system where we could link the test results, somebody's app to somebody's phone. Even though we had like high positivity rates, 10%, 15%, 20%, but vast majority of people testing were testing negative. And they wanted that negative test, so they could travel, so they could see their parents, so they could see family, et cetera. So NAVICA App was developed to be able to link that and provide a digitally encrypted testing certificate to the person that's getting that test. So that's worked very well. At the end of the year, we then got approval for an at-home version of our Binax test. We built additional capacity to support that rollout. And I think one of the differentiating factors here of our at-home test is definitely, there's an opportunity for at-home testing for people to be able to kind of do their test at home, not have to go to a pharmacy or to a physician's office or hospital. But during a pandemic, you want integrity in the system. You want to know that if you did the test, you did it right. And the person that's saying is negative is truly negative, right? I mean, we even had -- we had a tough time agreeing on these, right, on these masks. So we launched an at-home test that has a telemedicine. So it's a virtually guided test with a digital prop for health care professional to help somebody guide them through the test, and then there the person that inputs whether into the app, whether they're negative or positive. And that's, I think, is going to be super important in the fight, not only be able to have the at home test, but then do it in a way that there's integrity in the system. And then the scale-up was just as important for the test versus just the test development itself. So I'm impressed with the effort at Abbott. We built 2 manufacturing sites here in the U.S. for Binax. We started in May and finished in August, put several hundred million dollars of investment. We now got several hundred million dollars -- several hundred million test capacity per quarter. So we made a significant investment and scale up, and we did it for 2 reasons. I'd say, first, we do expect high volume. We knew that it wasn't just going to end in Q4, and we don't think it's going to end in Q1 or Q2, or quite frankly, throughout this year. So we do expect there to be high demand. I do think that with the vaccine rollout that we will see, let's call it, like a slowing down in this volume, I forecast that will look more like the end state, will probably look more like a flu like seasonal test. I don't see COVID just simply going away, but I do see it looking more like a flu-like seasonal test. And if you think about it globally, a flu-like seasonal test for COVID, it's pretty significant amount of volume, not just here in the U.S., but internationally. So -- and then the second reason we built all that capacity was really an acceleration of our point-of-care strategy. And this goes back a little bit to our strategy with the Alere acquisition. I talked about this a little bit in our last earnings call. The Alere acquisition was not just to build a portfolio of best-in-class point-of-care products, but it really was to think about creating and building a whole new testing channel, one that didn't exist that we could meet the need. And I talked about decentralization, democratization and digitization of that new testing channel. I think the pandemic, I'd say, brought a lot of visibility and awareness to rapid point-of-care testing. So there's a lot of people on asking the question, gee, how sustainable is COVID testing. And I would say at this level that we are experiencing right now, I don't think so. But I don't think it goes way. Like I said, I think it stays at a flu-like kind of volume, and you've got the spikes on seasons. But I think the question, though, misses the bigger strategic picture, right, which is, okay, we're taking it. We're using the pandemic and the efforts that we're doing to help in the pandemic to actually seed the market with this new testing channel and building this new testing channel. So if you think about our distribution strategy at physician offices, pharmacies, retail, urgent care clinics, I mean we've got several global airports around the world that are using our testing products. This is a whole new testing channel that's going to be there. And combined with the digital app ecosystem that we're building and pricing and a value proposition strategy, we believe that this is going to be a great opportunity for us going forward. So I do see COVID testing, I probably, at least right now from what I see during the second half start to kind of come down as the vaccine gets rolled out. But I think that we are building a more sustainable testing platform than just COVID. And then part of that is also developing new assays. So got the flu, got the COVID, but putting in the strep, the RSV, sexual transmitted disease. So building the assays around this assay -- this asset that we're developing is going to be important. So pandemic has accelerated that strategy. But I think it's a long-term growth area for us.

I hate to say if the Marcus family has used the Abbott ID NOW and PCR test several times, no Binax yet, but in the future.

Well, we've just announced today that we completed the purchase order from the federal government, 150 million tests, so that's been completed. And now the government will still buy some tests. But with all the capacity we have, we're open now for schools universities, employers, et cetera. And so we'll have planned capacity for that.

Wonderful. I'll get in line to purchase some. Maybe shifting gears a little bit. I'm sure we could talk COVID testing all day, but lots of other stuff to get to. And next up is Libre. And anyone who follows Abbott is aware of the tremendous success you've had with your wearable glucose sensor Libre. It's been a huge contributor to your growth over the past few years. And we saw a lot of pipeline activity, just even really in the past 12 months with more to come. So I know this is everyone's favorite question, but can you update us on the latest happenings with the Libre? And what should we expect in the near to mid-term going forward?

Sure. Well, 2020 was a pretty spectacular year, I'd say, for Libre, given the issue with COVID and the challenges with patients and physicians, et cetera. So I think we've had a really, really successful year this year. And I think that's really driven all the way back to the strategy that we put in place back in 2010, 2011. And I think that is really at the core and we'll probably -- I'll talk about some of the pipeline, which probably questions that people will have. But I think more importantly, is just understanding what's behind the strategy and the framework of the strategy. Back in 2010 and 2011, we wanted to focus on a much more mass-market opportunity than what you traditionally would expect start-up or device companies, which tend to go niche first, right, and then build off there. We wanted to go much bigger mass-market opportunity. I mean, if you think about it, you've got close to 400 million people living with diabetes in the world. 90% of them are living in -- outside the United States. I think about 1/4 of them are doing some sort of testing regimen across the spectrum, super high-frequency testers to more kind of episodic testing. But we also knew that CGM as a technology had a tremendous opportunity to improve outcomes. And you've seen that repeatedly through all the studies, definitely through our studies. People have lower A1cs. Patients spend less time in hypoglycemia, spend more time in a normal range. And all of those outcomes not only have an impact to the patient that can live better, but also an economic impact to the health care system. So our view of looking at it as a mass-market opportunity made us ensure that we stayed focused on 3 key things. I mean, it's easy to get distracted with a lot of the feature battles. And the -- this product has this, that product has that. Ultimately, you want to have a product that can deliver an outcome. A lot of that feature battle is very -- is -- I'd say, it's kind of very -- '80s, '90s devices. And we know now in devices that it's about the experience and it's about the outcomes. And that's what we always wanted to do. Build a consumer-friendly, intuitive, disposable sensor that improves outcomes, measurable improvement in outcomes and a cost profile that allows for mass adoption. Whether it's a reimbursement coverage for mass adoption or even if it's a cash pay, but it allowed for that mass adoption. I think that strategy that we put in place back in 2010, 2011, that strategy is working. We now have a multibillion-dollar product through the first 9 months of last year, the product grew 45%. We have significant broad reimbursement coverage and I think that's important. When you think about reimbursement, especially in this category, we don't measure success in reimbursement, whether we are able to maximize our selling price, our reimbursement price. We look at success in our access strategy and our reimbursement strategy as the breadth of coverage that a given population in a country has. And we have countries that have not only seen the value of the outcomes, but then the cost profile and say, okay, well, this makes a lot of sense to get as many people with diabetes with type 1 or type 2 on the product because there's not a significant hurdle financially cost-wise to get to, and then the long-term impacts of that patient population on sensor base is going to be significant. So that's worked very well. We're globally present. We're available in 50 countries. We're growing that. And a lot of our a expansion, a lot of our presence is -- we're very little dependent on distributors. So a lot of the relationships that we're building with consumers, with KOLs, all of those are done with -- under the Abbott brand with Abbott employees, Abbott leaders, Abbott people. So we're focusing on 3 key areas of investments. Obviously, promotion and awareness building is key. So whether that's with the physicians, whether that's direct-to-consumer advertising, I think that's going to be a big area of focus for us. I think you'll see a noticeable difference in that investment in 2021 for sure. The awareness level is still pretty low, not just in the U.S., but obviously, internationally, big investments that we've made in pipeline and manufacturing. So if you think about the manufacturing investments, and we put hundreds of millions of dollars here to be able to build scale. If you're looking at a mass-market opportunity, got between 80 million to 100 million people, you do the math on that at a certain average utilization rates, you need a significant amount of capacity. So we've done that. There's obviously more to do, more to go. We have several manufacturing sites across the world. Our cost position is unparalleled. We now got capacity for several hundred million sensors, and we're going to have to build more from that. But our base of which we got to build off from is very strong. On the pipeline slide, the investments we're making there, I mean, obviously, we've launched Libre 2 in the U.S., that was kind of happening more towards the end of the third quarter. The launch in the U.S. is going very well, similar to how it went in international markets. Those that follow IQVIA or other data can see that there's been a noticeable step-up in NBRxs here in the U.S. and TRxs since the launch. So that's going very well. We obtained approval for CE Mark approval for our Libre 3. So we're obviously working through. Especially when you're launching in Europe, you got to go through different reimbursement channels and contracts and documentations, et cetera. Obviously, that was a little bit difficult to do, I'd say, during COVID as some of those entities were focused more on rolling out vaccines and doing testing. So -- but we'll see that roll out shortly. I think the product is fantastic. It is going to be the smallest and lowest profile sensor. And from what we've seen out in the market of next-generation competitive products, it will still have that claim. Once those products launch, we like the idea of it having a continuous communication, improved applications. So all these important features without deviating from that initial strategic framework that I outlined. So Libre 3 will be coming at a similar cost position to payers and to patients and I think it's going to be a great product. We're working on a next versions of Libre. So you can assume that we have a 4 in the works and that we'll have a 5 in the works and that essentially, they'll be coming to market. And we've always talked about Libre being a platform. We've always talked about it being a platform and the ability to use that platform, form factor and manufacturing to be able to explore other areas outside of diabetes. And we wanted to make sure that we were -- we did a good job in the diabetes area before we started to venture out into those areas. And I think last year, you saw that we began that process. We have a dedicated team looking at these outside of diabetes opportunities. The first step was our Libre Sense Glucose Sport Biosensor. So we're looking here at targeting a sports market. These could be people that don't have diabetes, but they are interested in improving their performance in sports and understanding the linkage of their glucose levels of food to their sports performance. It's a completely different business model, different distribution channel. And we have a dedicated team that's looking at ramping up that. I think it will be a different business model. I think patient side is significantly larger in the diabetes. The utilization might be a little bit different, but I think it's an incredible opportunity. And then we've got additional, let's say, iterations and different analytes that we're looking at to be able to build that platform out. So I think 2020 was great for Libre. 2021, I think it will be another really exciting year for Libre. And as I said in the beginning, I think we're in the really early innings here. I know that might sound like a cliché, but once you look at the diabetes opportunity and then layer on the nondiabetes opportunities that exist to us and that we're working on, I truly believe that this is a multi, multi, year, year opportunity for us.

Great. So still clearly launch in-store for Libre and a lot of the exciting opportunities ahead, but there's a lot more at Abbott that we should be talking about here beyond just Libre and COVID and some of the things you talked about goes into devices, the rest of the diagnostics, branded generics, nutrition, so a lot to discuss. Maybe you could spend a few minutes and highlight some of the new product opportunities that you see coming out of the other businesses we haven't discussed yet.

Yes. I mean, I think -- I really think our pipeline is really strong, maybe a little bit underappreciated because some of the products like a MitraClip or Libre get so much attention. But I think we've got a great balance across our entire company on the R&D and pipeline side between both like iterative, innovations and more transformational opportunities. If I kind of go down a little bit of the list here at kind of very high level, you think about our branded generics pharma business and our nutrition business, you'll see a continual expansion and refreshment of the portfolios. And that's important in consumer-facing kind of health care categories. And I think 5you'll see that. I'm not going to tip my hand here, but you'll see that throughout this year, a steady stream of new products, new indications, new line extensions. Give an example of how we think about this last year, we launched 3 different versions of Pedialyte, which is a market-leading rehydration brand that we've got. We launched a Pedialyte Immune. We launched a Pedialyte Zero Sugar. We launched a Pedialyte Sport. So that's the kind of mindset and the framework by which we look at these more kind of consumer-facing health care businesses, constant iteration, content expansion, new indication, extensions, et cetera and I think you'll see that. We've got a very nice map over the next couple of years for those businesses. The diagnostics area, I mean, was already, I'd say, on fire in terms of innovation. And I think we just layered on a lot of opportunity there. But if you take a step back and think about our diagnostic innovation strategy, it really was about rolling out and continues to be rolling out our Alinity platform of products. We did something that no diagnostic company did is we refreshed all of our platforms, all at the same time, our immunoassay, clinical chemistry, hematology, our transfusion medicine and our molecular platforms all at same time to roll them out. And this business, as you know, you've got about a 15% tender renewal rate on your contracts every year. These contracts last between 7 to 10 years. So we're only in the first couple of years here. In Europe, we've been a couple of years since launch, the U.S. probably a year after that and only started getting going now in China which is our large market. So we've got a large long runway here of Alinity rollout to done. Obviously, the pandemic has affected some of those renewal and those tender cycles, but we're starting to see those bounce back now. I think one of the things that COVID did help us was kind of augment our launch of the Alinity m, our molecular system, here in the U.S. We had a plan to launch it in Q2. That was our original plan. And then we found ourselves right in the middle of having to place these instruments during COVID. So I think our placement rate was 4x what we had planned for. We're obviously building the menu. The system is super competitive in terms of its features and what it delivers to our customers. So I think this is a great opportunity for us. We're also investing on the diagnostics side in all of our rapid assays in our portfolio, as we talked about in your COVID question is branching out and putting into our rapid platforms, different assays. I think you saw one example of that yesterday, where we announced the approval for a rapid concussion test, a blood concussion test. So right now, when you think about -- if you've got a suspect of having a concussion, go to a hospital, get a CT scan that's pretty costly. Our scientists over the last 4 or 5 years have been working on identifying the proteins that are produced when you do have a concussion. They've been able to isolate and target them and develop a blood test. And I think this is a great opportunity for us without a doubt globally, but definitely here in the U.S., if you think about the amount of high schools, amount of colleges, sports leagues, et cetera, that would benefit from having a rapid blood concussion test before sending people over to do confirmatory CT, et cetera. So I think that the diagnostics business entered the pandemic with a real strong growth profile, and I think it's just gotten even stronger. On the device side, a lot of activity. I'll touch on a few handful of them. We talked about Libre, Libre 2, Libre 3, Libre Sports sensor. Structural Heart, we've done very well. We've launched into Europe during the pandemic, and we've got a lot of support from the implanters to do it because they wanted to see this technology was the TriClip, which is a similar to kind of MitraClip treating leaked tricuspid valves. So we modified the delivery catheter of the MitraClips, allow for better access to the tricuspid valve, a lot of strong feedback there, positive feedback also. Tendyne, we launched first of a kind mitral valve replacement product. I'm very proud with the team launching it into the pandemic, seeing very good real-world results, very similar to our RCT trials. So that's done very well. And if you think about Structural Heart and mitral being the next frontier, Abbott is leading the way with first of its kind transcatheter repair system and now first of its kind transcatheter replacement product. So we'll continue to build. We've launched MitraClip next-generation. In Europe and in the U.S. last year, we're building on a g5. We launched a new mapping system in EP, The EnSite X. We rolled that out in Europe, started to roll that out the U.S. this year. The Gallant family of rhythm management devices with Bluetooth and remote monitoring. We've got so much -- I mean, on the horizon, you've got MitraClip with expanded CMS reimbursement that's going to significantly expand the U.S. market. The Amulet, our LAA closure device, we finished the follow-up of those, and I'm very excited about the opportunity we have to launch this year in the U.S. It's a very competitive system in Europe. We'll have a readout fairly shortly on our CardioMEMS trial to support our CMS reimbursement for remote monitoring heart failure. I think this is a significantly large opportunity. If you do like a 10%, 15% penetration rate on that patient population, you're looking at $1 billion, $1.5 billion opportunity for us. Leadless pacemakers, we've done a lot of work there. We have a single chamber, and we'll follow up with a tool chamber. I think the interesting part of our leadless pacemaker is that it is -- it will be the only fully retrievable leadless pacemaker. So when the battery does end, you'll be able to go in there, retrieve it and replace it. And I think that expands our market opportunity. And then all the different versions of diabetes and nondiabetes on Libre. So I think one of the key things here for us, Robbie, is that we've taken advantage of the strength of our COVID testing portfolio and look at all the opportunities that those revenue streams, those profits streams can afford us to reinvest even further across our portfolio. And that's what we're going to be doing this year is not only strengthening and accelerating what we currently had in the portfolio, but looking now at bringing new products in place, so that when we can think about 2023, 2024, we're reloaded, and we've got a real strong pipeline. So I feel really good about the products that we've got to launch over the next 2 years, and I'm excited about the investment opportunities we have to build a pipeline beyond those 2 years going forward.

Well, great, Robert, in the last few minutes, I want to end on a bit of a capital allocation and investing discussion. So Abbott is in a clearly enviable financial position, that only improved with all of the cash that's been thrown off from the new COVID testing business. So what's your latest thinking in terms of capital deployment for Abbott? And where do you see the most opportunity for increased investment over the coming months, years, so on?

Yes. So our financial health is very strong. Our balance sheet is very strong. I would say if you think about our opportunities for capital allocation, paying a strong and growing dividend, that is a part of our capital allocation strategy. It's part of -- it's an important part of our identity to be able to return a portion of our capital back to our shareholders. We like to be in that 40% to 45% dividend payout ratio. So that's kind of where we try to stay. Last month, we announced a 25% increase in our dividend for 2021. So I think that's an important part of our strategy. We haven't done a lot of share repurchasing historically, mostly to offset some of the early dilution that we get to. From a debt perspective, I think you mentioned there, I mean, we're in a great, great standpoint from a debt perspective. A lot of work has gone into to be into that position over the last couple of years to kind of restore, let's call it, some strategic flexibility. We don't have any debt coming due this year and what's coming through next year in 2022 is very manageable. And then in terms of M&A, I'd say anything we're interested in and have been pretty consistent here, they've got to fit a few of our criteria. I mean first of all, good fit strategically for us, whether it's augmenting and existing part of our portfolio or looking at a new area of entrance, but it has to be a good fit strategically for us. It has to align with our growth orientation. Right now, I'd say, Abbott, before COVID, we were in that kind of 7% to 8% top line growth rate, and I wouldn't want to bring anything in that would take away from -- or dilute or take away from that growth orientation. So -- and then finally, it's got to be able to generate strong returns for the shareholders. And when you think about valuations over there, that's an important aspect as we look at that. So we're actively monitoring. We actively look. We actively study. We've been actively studying for several years now across all of our businesses. And I'd say to the extent that we do, do something, it would be more on the tuck-in side, but again, not deviating from that growth orientation that we discussed. And I would say, and even if there was something on the radar, Robbie, we wouldn't be -- I wouldn't want to be tipping my hand or telegraphing what we're going to do, we wouldn't want to say so. But I think what you can know is that we're constantly looking. We're constantly studying and that we've got a framework by which we'll approach that. But that being said, I think we've got great opportunities to deploy our capital internally with a lot of our organic opportunity, and they generate great returns. I mean, the investment we made in COVID and expanding our COVID portfolio, I mean, the returns that we got from those investments are significant, the returns we're getting from Libre expansion. So I think that we've got a lot of opportunity also internally. And so I think it's really looking at that balance, looking at our organic opportunities, staying committed to our dividend and being within that ratio that I talked about. And then staying diligent and disciplined as it relates to M&A. I think the strength of the COVID business has given us a lot of opportunities to further invest in our businesses and pipelines, and I don't think there's any shortage of that here at Abbott, as I described in our pipeline. So I would say, listen, we -- I think we had a great year in 2020. We'll report our Q4 results in a few weeks. But I'd say we were -- we came into 2020 strong. I think we exited even stronger as we go into 2021. So I'm excited about the opportunities we have in front of us to not only have short-term returns, but also long-term sustainability for our business.

Great. Well, it's an enviable position, and it's been a great first year as a CEO. I want to thank you for being here today and taking the time to speak with everyone. Unfortunately, we're out of time. It could probably go on for a lot longer. But thank you so much, and hope everyone enjoys the rest of their day.

Thank you.