RE_ Immediate Action Required_ Abbott Contract Compliance.p.pdf

From: Chadwell, Amalia To: Barclay, Steve - CO 9th Cc: josh.roberts@mckesson.com; Loosli, Angela - SHS; Kaul, ManDee - SHS; Dowding, Brady - SHS; Brady, JP - CO 9th Subject: RE: Immediate Action Required: Abbott Contract Compliance Date: Wednesday, September 2, 2026 2:43:46 PM Attachments: image001.png image003.png

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Hi Steve, Thank you for your candid feedback and for taking the time to discuss the situation with us. We value our longstanding partnership and share your goal of finding the best path forward for the facility while ensuring all contractual obligations are clearly understood.

To provide some additional context, since the beginning of our partnership in 2011, the contract has consistently contained the requirement, although located in different sections over time, that all purchases for products and/or services listed on the price exhibit be purchased directly from Abbott.

Given the recent agreement with McKesson, one of our valued distribution partners that can supply consumable goods, though not our equipment, it appears there may not have been full visibility into the implications this would have on the existing Abbott agreement.

As background, the Abbott contract is structured as a reagent rental agreement. While you may already be familiar with this model, I want to provide context for everyone copied on this correspondence, as it helps explain the options available.

Abbott combines the costs of all Abbott equipment and any associated data management charges, then allocates those costs across the number of strips the facility has advised it will use. This is how the strip price is established.

Under this arrangement, Abbott assumes responsibility for paying the data management company in full up front and allows the facility to pay over time for Abbott goods. We do this without additional fees or interest charges, relying on the commitments outlined in the contract and the understanding that the facility will fulfill those commitments over the term of the agreement.

When circumstances arise that affect compliance with those commitments, our first step is always to understand the underlying issue and work collaboratively toward a resolution. In this instance, it appears the State may not have been aware of the existing contract requirements or may not have fully understood the direct-purchase requirement.

I hear your position clearly that the State of Idaho has entered into a contract with McKesson for the purchase of goods. Many of our customers maintain relationships with both McKesson and Abbott, and we appreciate the State's procurement considerations.

That said, the current situation leaves us with the following options:

mailto:amalia.chadwell@abbott.com mailto:Steve.Barclay@dhw.idaho.gov mailto:josh.roberts@mckesson.com mailto:Angela.Loosli@dhw.idaho.gov mailto:ManDee.Kaul@dhw.idaho.gov mailto:Brady.Dowding@dhw.idaho.gov mailto:JP.Brady@dhw.idaho.gov

Option 1

Per the contract parameters, the facility would notify us that it is terminating the contract under sections 2.2 & 2.5.2. The agreement would then be terminated for non-compliance.

This will result in:

Any outstanding current and future commitments outlined in the contract being invoiced directly to the facility.

The equipment being requested for return within 30 days of the termination date. We will assist with this process at no cost to the facility.

If equipment is not returned, an additional invoice for the equipment cost will be issued.

The termination also addresses the data management component. Consistent with my legal obligation to communicate this, any use of the data management system after the termination date may result in the data management company choosing to bill the facility directly for continued use.

Option 2

The State and facility negotiate the necessary exclusion from the post-Abbott executed contract so that the facility can continue to meet its commitments under the Abbott agreement.

For clarity, many of our mutual customers successfully maintain arrangements with both McKesson and Abbott simultaneously.

Regarding McKesson's ability to source the data management solution so the site can retain access to the Siemens software and records, I have already proactively reached out to Josh Roberts at McKesson and shared that, according to Siemens, billing is available only through a direct relationship with Siemens or through Abbott.

We remain committed to working collaboratively with you and the State to identify the most practical and mutually beneficial path forward. Please let us know how you would like to proceed, and we will do our best to support a timely resolution.

Kind regards, Molly

Amalia Chadwell (Molly) Inpatient Hospital Account Executive Point of Care Channel POC Glucose & β Ketone O: 800‑401‑1183 x 5541 amalia.chadwell@ abbott . com

This communication may contain information that is proprietary, confidential, or exempt from disclosure. If you are not the intended recipient, please notify the sender immediately and delete this message.

mailto:dorothy.ash@abbott.com

From: Barclay, Steve - CO 9th <Steve.Barclay@dhw.idaho.gov> Sent: Tuesday, September 1, 2026 9:08 AM To: Chadwell, Amalia <amalia.chadwell@abbott.com> Cc: josh.roberts@mckesson.com; Loosli, Angela - SHS <Angela.Loosli@dhw.idaho.gov>; Kaul, ManDee - SHS <ManDee.Kaul@dhw.idaho.gov>; Dowding, Brady - SHS <Brady.Dowding@dhw.idaho.gov>; Brady, JP - CO 9th <JP.Brady@dhw.idaho.gov> Subject: RE: Immediate Action Required: Abbott Contract Compliance

Amalia, Thank you for the note. I want to clarify our contract position here. The State is now contractually required to purchase Abbott Test Strips through McKesson, not directly through Abbott. This is why no recent direct purchases have been

Amalia, Thank you for the note. I want to clarify our contract position here. The State is now contractually required to purchase Abbott Test Strips through McKesson, not directly through Abbott. This is why no recent direct purchases have been made under the Abbott agreement.

As you know, I have been working with you and our McKesson representatives to try to retain access to the Abbott software through McKesson as our purchasing channel. Based on your email this morning, it sounds like that is no longer an option and that we will be losing access to the software.

I am copying the hospital on this email for visibility, given the impact this will have on their operations.

Can you please confirm when we will lose access to the software, so the hospital can plan accordingly.

Steve Barclay Senior Buyer Contracting & Procurement Services | Idaho Department of Health and Welfare 208-334-5735 desk Steve.Barclay@dhw.idaho.gov

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From: Chadwell, Amalia <amalia.chadwell@abbott.com> Sent: Tuesday, September 1, 2026 7:26 AM To: Barclay, Steve - CO 9th <Steve.Barclay@dhw.idaho.gov> Cc: josh.roberts@mckesson.com Subject: Immediate Action Required: Abbott Contract Compliance

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Good morning, Mr. Barclay, https://www.facebook.com/Abbott https://x.com/AbbottNews https://www.youtube.com/c/abbott https://www.linkedin.com/company/abbott-http://instagram.com/abbottglobal mailto:Steve.Barclay@dhw.idaho.gov https://urldefense.com/v3/__https:/healthandwelfare.idaho.gov/services-programs/children-families/child-and-family-services-and-foster-care/apply-become-foster__;!!BBM_p3AAtQ!O7WjvImievz6Q05NYpyr-LbzIYQeoVQ8AT05E4zNwr4DN1FuCEO_AlqJ5_kNfUXUikX1ghcvYaF6fPDlzPgUFxDhRsK9qVtApHg$ mailto:amalia.chadwell@abbott.com mailto:Steve.Barclay@dhw.idaho.gov mailto:josh.roberts@mckesson.com

I am reaching out because no purchases have been made under your Abbott agreement, and your account is currently at risk of falling out of compliance.

As outlined in the contract clause previously provided, purchases must be made directly through Abbott.

Contract Details:

Committed Volume: 18,000 strips Compliance Period: June 12, 2026 – June 11, 2027 Contract Expiration: June 11, 2027

To avoid non-compliance and potential impact to your contract commitments, a purchase needs to be made as soon as possible. Please let me know if there are any issues preventing you from ordering so we can address them promptly.

3. CUSTOMER RIGHTS AND OBLIGATIONS. (3.1) Purchase Commitment. As of the Effective Date, Customer shall: General Terms and Conditions - Page 2 of 13 8175281 .v1 .ACTIVE DocuSign Envelope ID: 0AE40547-4AA1-4632-A653-517B6E176289 MASTER AGREEMENT – GENERAL TERMS

AND CONDITIONS ABBOTT DIABETES CARE SALES CORPORATION, 1420 HARBOR BAY PARKWAY,

ALAMEDA, CA 94502 3.1.1. Purchase from ADC the Equipment, Products, and/or Services in the quantities specified in Price Exhibit, attached hereto as Exhibit A; 3.1.2. Pay the Purchase Price for any and all Equipment, Products, and/or Services procured pursuant to this Agreement. To the extent applicable Customer shall also pay the Equipment Service Fee. Shipping and handling charges for Equipment and/or Products shall be prepaid and added to each invoice for Customer to pay.

Kind Regards, Molly

Amalia Chadwell (Molly) Inpatient Hospital Account Executive Point of Care Channel POC Glucose & β Ketone O: 800‑401‑1183 x 5541 amalia.chadwell@ abbott . com

This communication may contain information that is proprietary, confidential, or exempt from disclosure. If you are not the intended recipient, please notify the sender immediately and delete this message.

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