Message from the Chairman & CEO

We appreciate this opportunity to share news of our continued progress in addressing the most important impacts that our company makes in our world. These are the areas in which our business has the greatest effects on society and the environment, and which offer us the greatest opportunity to make a difference in the challenges facing our world today.

We believe that, for commercial success to be sustainable, we must conduct ourselves and our business activities responsibly. Therefore, citizenship issues lie at the heart of our corporate strategy. As we move forward, we must continue to conduct ourselves and our business activities responsibly. We draw our inspiration and our guidance in this work from the Abbott Promise, which clearly defines our values and the constructive role we strive to play in the world.

Our primary responsibility is to develop innovative answers to health care needs. In 2008, we delivered on this promise by continuing to bring forward new health care products that are transforming people’s health around the world – which drove another year of strong growth across our businesses.

This strong performance comes against the backdrop of significant challenges in our operating environment. We are witnessing the worst global economic situation in many decades. This is coupled with increasing concern over global climate change. Concerns over product safety have arisen due to high-profile incidents resulting from complex and fragmented supply chains. Regulatory and competitive pressures continue to grow around the world, in particular, ongoing threats to incentive systems that ensure sustainable innovation.

In an operating environment of this complexity, with so many important considerations to balance, we have recognized the need to carefully determine our strategic priorities. We have identified four key areas in which to focus our citizenship efforts. These are the areas in which our business has the greatest impact on society and the environment, and also where we have the greatest ability to make a difference.

Innovating for the Future

We need to continue to use our skills and ingenuity to advance medical innovation to make a difference to the health and well-being of people everywhere. In 2008, we had nine major product launches across our range of businesses – pharmaceuticals, nutrition products, diagnostics and medical devices. With slightly more than half of our sales now coming from outside the United States, our innovation efforts need to meet the specific needs of developed and emerging markets – such as pediatric and heat-stable pharmaceutical formulations.

Enhancing Access to Medicine and Health Care

At the same time, we recognize the significant barriers to access many people experience. We are committed to addressing these issues by developing innovative treatment options and enhancing access to our medicines and medical products through investment and wider engagement with governments and key stakeholders. In 2008, we contributed more than $460 million in grants and products from Abbott and the Abbott Fund, the majority of which was directed toward providing patients with access to medicine and health care through capacity building partnerships, product donations and patient assistance programs.

Protecting Patients and Consumers

People trust us to develop innovative products that are of high quality and safe to use. We are committed to promoting quality and safety in our operations and beyond. We consider our safety to be of paramount importance, and we are continuously strengthening our safety processes.

Safeguarding the Environment

With world population expansion, the global challenges of climate change and water scarcity continue to grow. We are committed to playing our part in tackling these issues, while minimizing the environmental impacts of our products.

In 2008, we achieved significant reduction in our greenhouse gas emissions and water use in manufacturing. We plan to share our experience of responsible water stewardship with local communities. We also made good progress in assessing our packaging footprint and putting in place targets and systems to help us reduce our impact in this area.

Our successful efforts in these and other areas earned Abbott inclusion on the Dow Jones Sustainability Index for the fourth consecutive year. Looking forward to 2009, we will launch an internal program to further develop our approach to these priorities and bring them to life around the globe.

Our world today is a more uncertain place than it was when I wrote to you in this report one year ago. Yet, we remain guided by the values that have sustained us for more than 120 years, continuing to deliver on our commitments to our many stakeholders around the world.

We thank you for your shared commitment to this work and your interest in our efforts.

Miles D. White
Chairman and Chief Executive Officer
April 2009