New York, Feb 3, 2026, 15:42 ET — Regular session.
Shares of Abbott Laboratories dipped 0.6% to $108.77 Tuesday afternoon after the U.S. Food and Drug Administration issued a warning letter to Abbott Diabetes Care. The letter, dated Jan. 23, criticized the company’s process for verifying the accuracy of its FreeStyle Libre continuous glucose monitors (CGMs). Specifically, the FDA said Abbott failed to ensure key accuracy specs were passed to third-party manufacturers and released finished devices without conducting accuracy tests at launch. Abbott has 15 business days to respond. Earlier, the stock had fallen as much as 2.9%.
Libre is now a critical front for Abbott in diabetes tech, where sensor precision can make or break the business. Investors remain wary after Abbott launched a U.S. device correction in November affecting certain Libre 3 and Libre 3 Plus sensors. The company said some units might show falsely low glucose readings, impacting around 3 million sensors stateside. A correction means fixing a product already on the market, without a full recall.
Leerink Partners analyst Mike Kratky and J.P. Morgan’s Robbie Marcus noted the warning letter doesn’t halt Abbott from making, marketing, or distributing Libre products—nor does it demand a recall. Marcus added that, given what’s known so far, “we don’t expect any material impact to numbers.” MedTech Dive
The FDA letter came after an inspection of Abbott’s diabetes-care facility in Alameda, California, last October. It pointed out that Abbott’s quality-system procedures failed to ensure sensor-accuracy standards were properly implemented in manufacturing controls at external sites.
The regulator added that Abbott’s managers acknowledged finished devices weren’t performance-tested for accuracy following final assembly, sterilization, programming, and packaging. The letter cautioned that failure to address these problems could lead to seizure, injunction, or civil money penalties. It also flagged that quality violations might hinder approvals and complicate some export-related documentation.
In a separate move, the Australian Competition and Consumer Commission has launched a Phase 1 review of Abbott’s proposed purchase of Exact Sciences. Submissions are due by Feb. 9, with the agency expected to decide by March 17.
In November, Abbott revealed plans to acquire Exact Sciences at $105 per share in cash, setting the deal’s value near $21 billion. The transaction is on track to close in the second quarter of 2026, subject to shareholder and regulatory sign-offs.
Abbott’s action coincided with mixed results among diabetes-device rivals. Dexcom dropped roughly 1.3%, whereas Medtronic and Johnson & Johnson each gained between 1% and 2%.
Traders are focused on whether Abbott can swiftly resolve the FDA findings without costly tweaks that might disrupt production or complicate the final release process, especially with contract manufacturers in the mix. Even a minor quality-system dispute risks lingering if it triggers more inspections down the line.
But plenty could still change. If the FDA isn’t convinced, it could step up its response. Any new safety concerns with Libre sensors would likely trigger harsher measures and a more severe market drop than Tuesday’s mild decline.
On the deal front, the Australian review introduces yet another deadline for Exact Sciences. If regulators drag their feet or clients raise objections, the closing window could narrow further the longer the process stretches out.
Next up for the market: Abbott’s deadline to submit a written response to the FDA warning letter, and the ACCC’s February 9 cutoff for submissions before its March 17 decision period closes.
