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Alere’s Device Recall Stirs More Questions About Abbott Deal

  • Abbott says it’s disappointed; review of deal continues
  • Analysts say financial filing from Alere expected by Friday

Alere Inc. is recalling a device that monitors patients taking a sensitive blood-thinning medicine, a move that may further destabilize its pending acquisition by Abbott Laboratories.

The voluntary withdrawal, which will cost between $70 million and $90 million this year, was requested by the U.S. Food and Drug Administration after it questioned the effectiveness of software updates meant to address earlier concerns about the technology’s accuracy.

Abbott, which has tried to end the $5.8 billion deal after Alere disclosed a U.S. investigation of its overseas businesses, said Tuesday that it is disappointed by the recall and assessing its impact on its review of Alere’s books. Abbott agreed to purchase Alere for $5.8 billion in February. Less than a month later, Alere delayed filing its 2015 financial report with U.S. securities regulators, and in March said that it had been subpoenaed by the Justice Department over sales practices in Africa, Asia and Latin America.

“Abbott is seeking to better understand this withdrawal as part of its ongoing review of financial and other information to ensure that all outstanding issues at Alere are clearly understood, including its delayed financial statements and the criminal grand jury subpoena alleging violations of the Foreign Corrupt Practices Act,” Abbott spokesman Scott Stoffel said.

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