08.17.21
Rank: #5 (Last year: #5)
$4.29 Billion ($30.12 Billion)
Prior Fiscal: $4.08 Billion
Percentage Change: +5%
No. of Employees: 90,000 (total)
Global Headquarters: Dublin, Ireland
KEY EXECUTIVES:
Geoffrey S. Martha, Chairman and CEO
Karen L. Parkhill, EVP and CFO
Brett Wall, EVP and President, Neuroscience Portfolio
Noel Colón, SVP, Chief Quality Officer
Alex Gu, SVP and President, Greater China
Chris Lee, SVP and President, Asia Pacific
John Liddicoat, M.D., EVP and President, Americas Region
Laura Mauri, M.D., M.SC., SVP, Chief Clinical and Regulatory Officer
Sean Salmon, EVP and President, Diabetes Operating Unit; President, Cardiovascular Portfolio
Rob Ten Hoedt, EVP and President, Europe, Middle East, and Africa Region
Bob White, EVP and President, Medical Surgical Portfolio
Medtronic’s 2021 fiscal period marked quite the debut for its new CEO. Although taking a spot on the Board of Directors in November 2019, the firm’s latest fiscal (which began April 27, 2020) marked Geoff Martha’s first full 12-month recorded financial period at the helm of the world’s largest medical device manufacturer.
Not only did he help the organization navigate the challenges brought on by a worldwide pandemic, but Martha also steered the company to revenues of over $30 billion for only the second time in its history. More impressive still, that final tally came after a 13 percent decrease in Q1 and a 1 percent drop in Q2 when compared to the same periods during its 2020 fiscal.
Perhaps a beneficiary of the unusual timeframe the firm uses for its fiscal year (a nod to its founding; always ends on the last Friday of April), the organization saw a return of pre-COVID level sales during its fourth quarter, which rose an astounding 37 percent over the prior year.
“We reported a strong end to our fiscal year, with our fourth quarter results demonstrating continued momentum. Our recovery improved throughout the quarter, with most of our markets returning to near normal, pre-COVID growth rates,” said Martha. “In addition to supporting our employees, customers, and communities during the pandemic, we accomplished important milestones, including launching new products, investing in our pipeline, and changing our operating model, just to name a few. As we look ahead, these actions set us up to drive accelerated revenue growth in the year ahead and over the long term.”
Once the dust settled, Big Blue found itself with revenues 4 percent higher than the previous fiscal. The rise saw the company’s coffers grow from $28.91 billion in 2020 to $30.12 billion in 2021.
The change in operating model Martha referenced in his statement regarding the fourth quarter had no impact on the company’s reportable segments, but it did establish new labels for its business groups. Put into effect on Feb. 1, the new model reflected the company’s segments as clinical portfolios rather than groups. The new names are Cardiovascular Portfolio (formerly Cardiac and Vascular Group), Neuroscience Portfolio (formerly Restorative Therapies Group), Medical Surgical Portfolio (formerly Minimally Invasive Therapies Group), and Diabetes Operating Unit (formerly Diabetes Group).
There was a change within the Neuroscience sub-portfolio, however, that did impact Medtronic’s Spine division. With the reshuffling of names among reporting groups, the previously solo Spine division found itself paired with Cranial therapies to form the Cranial & Spinal Technologies unit. As a whole, the division provides technologies to support the spine and musculoskeletal system, in addition to products used in neurosurgical procedures.
This new combination accounted for the significant increase in revenue presented this year when compared to last year’s ODT Top Company list, but as reported by Medtronic, the gain year over year was only 5 percent. In real dollars, that translates to $4.29 billion in 2021, up from $4.08 billion in 2020. The gains were driven primarily by increases within Enabling Technologies and Spine, which were due to the recovery in surgical procedure volume and capital equipment purchases.
In addition to the aforementioned operating model changes, Medtronic also saw a revision at its upper leadership level. In an expected move, former CEO Omar Ishrak continued his separation from the medtech giant with the announcement that he would retire from his position as executive chairman and chairman of the board on Dec. 11, 2020.
“I am excited about the future of the company, and I am certain that under Geoff’s leadership and the collective guidance of the Board of Directors, Medtronic will reach new heights,” said Ishrak. “The Medtronic Mission provides the company with a true and genuine sense of purpose, which the leadership of the company has followed diligently for over 60 years. I know that continued adherence to the guiding principles embodied in the six tenets of the Mission will ensure long-term success.”
As always seems to be the case with Medtronic, the changes didn’t stop there. The company made several strategic acquisitions to help strengthen its offerings in key areas, one of which will hopefully positively impact the Cranial & Spinal Technologies division. In July 2020, the organization announced it would purchase Medicrea for 7 euros per share (or approximately 139 million euros/$158 million). The transaction, which was finalized in November 2020, brought more than 30 510(k)-cleared or CE marked implant technologies utilized in spinal surgeries for adult deformity, pediatric deformity, and degenerative disease to Medtronic. The deal was also expected to enhance Medtronic’s artificial intelligence and robotic surgery capabilities for spine procedures.
“We have entered the age of augmented intelligence in spinal surgery at the point of care,” said Christopher Ames, M.D., director of spinal tumor and spinal deformity surgery at UCSF Medical Center in California. “Through the power of predictive models, data collection and machine learning, a unique capability is created, allowing for a continuous cycle of improvement. Physicians will have augmented eyes through surgical navigation, augmented hands with robotics, and most importantly, augmented intelligence through full integration with machine intelligence impacting all aspects of the care pathway. This type of technology will likely lead to safer procedures and more reliable outcomes while preventing costly revision surgery. It is rewarding to see the spine industry fully embracing these new capabilities and investing in the future.”
When it wasn’t growing through a purchase, Medtronic still expanded its reach with strategic partnerships. For one such arrangement, Medtronic partnered with Surgical Theater to allow an interface between the latter’s SyncAR augmented reality (AR) and Medtronic’s StealthStation S8 surgical navigation system. The end result is expected to enable neurosurgeons to use AR technology in real-time to enhance visualization during complex cranial procedures. Using fighter-jet simulation technology, the SyncAR platform allows surgeons to visualize structures in the brain, test virtual surgical tools, and plan surgeries before entering the operating room.
The firm also made a substantial product announcement that harkens back to its previous acquisition of Titan Spine, a deal finalized in June 2019. The news centered around the U.S. launch of the Adaptix Interbody System, the first navigated titanium implant with Titan nanoLOCK Surface Technology—a proprietary blend of surface textures on the macro, micro, and nano levels. The offering represents the first 3D printed titanium implant, developed in house by Medtronic engineers, to incorporate the Titan product.
“Adaptix Interbody System allows me the best chance to meet my patients’ needs by confidently placing the implant under navigation and trusting the Titan nanoLOCK Surface Technology to allow the implant to promote fusion. Surface technology, material type, and implant design all play a role in bone growth process during fusion,” said J. Justin Seale, M.D. of OrthoArkansas Spine Institute. “The unique features and world-class technologies make the Adaptix Interbody System a truly differentiated implant.”
$4.29 Billion ($30.12 Billion)
Prior Fiscal: $4.08 Billion
Percentage Change: +5%
No. of Employees: 90,000 (total)
Global Headquarters: Dublin, Ireland
KEY EXECUTIVES:
Geoffrey S. Martha, Chairman and CEO
Karen L. Parkhill, EVP and CFO
Brett Wall, EVP and President, Neuroscience Portfolio
Noel Colón, SVP, Chief Quality Officer
Alex Gu, SVP and President, Greater China
Chris Lee, SVP and President, Asia Pacific
John Liddicoat, M.D., EVP and President, Americas Region
Laura Mauri, M.D., M.SC., SVP, Chief Clinical and Regulatory Officer
Sean Salmon, EVP and President, Diabetes Operating Unit; President, Cardiovascular Portfolio
Rob Ten Hoedt, EVP and President, Europe, Middle East, and Africa Region
Bob White, EVP and President, Medical Surgical Portfolio
Medtronic’s 2021 fiscal period marked quite the debut for its new CEO. Although taking a spot on the Board of Directors in November 2019, the firm’s latest fiscal (which began April 27, 2020) marked Geoff Martha’s first full 12-month recorded financial period at the helm of the world’s largest medical device manufacturer.
Not only did he help the organization navigate the challenges brought on by a worldwide pandemic, but Martha also steered the company to revenues of over $30 billion for only the second time in its history. More impressive still, that final tally came after a 13 percent decrease in Q1 and a 1 percent drop in Q2 when compared to the same periods during its 2020 fiscal.
Perhaps a beneficiary of the unusual timeframe the firm uses for its fiscal year (a nod to its founding; always ends on the last Friday of April), the organization saw a return of pre-COVID level sales during its fourth quarter, which rose an astounding 37 percent over the prior year.
“We reported a strong end to our fiscal year, with our fourth quarter results demonstrating continued momentum. Our recovery improved throughout the quarter, with most of our markets returning to near normal, pre-COVID growth rates,” said Martha. “In addition to supporting our employees, customers, and communities during the pandemic, we accomplished important milestones, including launching new products, investing in our pipeline, and changing our operating model, just to name a few. As we look ahead, these actions set us up to drive accelerated revenue growth in the year ahead and over the long term.”
Once the dust settled, Big Blue found itself with revenues 4 percent higher than the previous fiscal. The rise saw the company’s coffers grow from $28.91 billion in 2020 to $30.12 billion in 2021.
The change in operating model Martha referenced in his statement regarding the fourth quarter had no impact on the company’s reportable segments, but it did establish new labels for its business groups. Put into effect on Feb. 1, the new model reflected the company’s segments as clinical portfolios rather than groups. The new names are Cardiovascular Portfolio (formerly Cardiac and Vascular Group), Neuroscience Portfolio (formerly Restorative Therapies Group), Medical Surgical Portfolio (formerly Minimally Invasive Therapies Group), and Diabetes Operating Unit (formerly Diabetes Group).
There was a change within the Neuroscience sub-portfolio, however, that did impact Medtronic’s Spine division. With the reshuffling of names among reporting groups, the previously solo Spine division found itself paired with Cranial therapies to form the Cranial & Spinal Technologies unit. As a whole, the division provides technologies to support the spine and musculoskeletal system, in addition to products used in neurosurgical procedures.
This new combination accounted for the significant increase in revenue presented this year when compared to last year’s ODT Top Company list, but as reported by Medtronic, the gain year over year was only 5 percent. In real dollars, that translates to $4.29 billion in 2021, up from $4.08 billion in 2020. The gains were driven primarily by increases within Enabling Technologies and Spine, which were due to the recovery in surgical procedure volume and capital equipment purchases.
In addition to the aforementioned operating model changes, Medtronic also saw a revision at its upper leadership level. In an expected move, former CEO Omar Ishrak continued his separation from the medtech giant with the announcement that he would retire from his position as executive chairman and chairman of the board on Dec. 11, 2020.
“I am excited about the future of the company, and I am certain that under Geoff’s leadership and the collective guidance of the Board of Directors, Medtronic will reach new heights,” said Ishrak. “The Medtronic Mission provides the company with a true and genuine sense of purpose, which the leadership of the company has followed diligently for over 60 years. I know that continued adherence to the guiding principles embodied in the six tenets of the Mission will ensure long-term success.”
As always seems to be the case with Medtronic, the changes didn’t stop there. The company made several strategic acquisitions to help strengthen its offerings in key areas, one of which will hopefully positively impact the Cranial & Spinal Technologies division. In July 2020, the organization announced it would purchase Medicrea for 7 euros per share (or approximately 139 million euros/$158 million). The transaction, which was finalized in November 2020, brought more than 30 510(k)-cleared or CE marked implant technologies utilized in spinal surgeries for adult deformity, pediatric deformity, and degenerative disease to Medtronic. The deal was also expected to enhance Medtronic’s artificial intelligence and robotic surgery capabilities for spine procedures.
“We have entered the age of augmented intelligence in spinal surgery at the point of care,” said Christopher Ames, M.D., director of spinal tumor and spinal deformity surgery at UCSF Medical Center in California. “Through the power of predictive models, data collection and machine learning, a unique capability is created, allowing for a continuous cycle of improvement. Physicians will have augmented eyes through surgical navigation, augmented hands with robotics, and most importantly, augmented intelligence through full integration with machine intelligence impacting all aspects of the care pathway. This type of technology will likely lead to safer procedures and more reliable outcomes while preventing costly revision surgery. It is rewarding to see the spine industry fully embracing these new capabilities and investing in the future.”
When it wasn’t growing through a purchase, Medtronic still expanded its reach with strategic partnerships. For one such arrangement, Medtronic partnered with Surgical Theater to allow an interface between the latter’s SyncAR augmented reality (AR) and Medtronic’s StealthStation S8 surgical navigation system. The end result is expected to enable neurosurgeons to use AR technology in real-time to enhance visualization during complex cranial procedures. Using fighter-jet simulation technology, the SyncAR platform allows surgeons to visualize structures in the brain, test virtual surgical tools, and plan surgeries before entering the operating room.
The firm also made a substantial product announcement that harkens back to its previous acquisition of Titan Spine, a deal finalized in June 2019. The news centered around the U.S. launch of the Adaptix Interbody System, the first navigated titanium implant with Titan nanoLOCK Surface Technology—a proprietary blend of surface textures on the macro, micro, and nano levels. The offering represents the first 3D printed titanium implant, developed in house by Medtronic engineers, to incorporate the Titan product.
“Adaptix Interbody System allows me the best chance to meet my patients’ needs by confidently placing the implant under navigation and trusting the Titan nanoLOCK Surface Technology to allow the implant to promote fusion. Surface technology, material type, and implant design all play a role in bone growth process during fusion,” said J. Justin Seale, M.D. of OrthoArkansas Spine Institute. “The unique features and world-class technologies make the Adaptix Interbody System a truly differentiated implant.”