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Recently,Ariel Mactavish, President of Medtronic's Respiratory Interventions Business, Announces Departure via Social Media.

"In a LinkedIn post, she said: 'After a fulfilling 12-year tenure, I have decided to step away from Medtronic. I would like to express my deepest gratitude for the outstanding contributions of our team and their unwavering dedication to patients and customers.'"
Mactavish's departure was decided after Medtronic announced its exit from the ventilator market and the merger of its Patient Monitoring and Respiratory Interventions (PMRI) business. Last month, Bob White, Executive Vice President and President of Medtronic's Medical Surgical Portfolio, also departed due to the merger decision.
One year ago, in October 2022, Medtronic announced that it would soon spin off its PMRI division.According to Reuters, GE Healthcare, Siemens Healthineers Clayton, ICU Medical, and others were interested in acquiring its divested business. Later, the private equity giant Carlyle Group took the lead and entered into negotiations with Medtronic. According to media reports, the proposed acquisition price exceeded $7 billion (approximately RMB 51.1 billion).
But in the end, the company chose to stop its ventilator business and merge the remaining Patient Monitoring and Respiratory Interventions (PMRI) business into a new business unit called Acute Care and Monitoring (ACM).Will includePulse Oximeters, Remote Patient Monitoring, Airway Management and Respiratory Monitoring Products.
It is reported that the company chose to exit the ventilator business because, with the stabilization of the pandemic, ventilators have become increasingly unprofitable. However, in the company’s view, the remaining businesses in the PMRI division still hold investment value.

Bob White
As part of the portfolio decision,Bob White, Executive Vice President and President of Medtronic's Medical Surgical business portfolio, also departed at the same time, succeeded by Mike Marinaro, Executive Vice President of Medtronic.
So, is Mactavish's departure also part of this portfolio decision?We can't help but wonder. In her resignation announcement, she left the following words: "We have celebrated many significant milestones — from the acquisition of Aircraft Medical to the revitalization of the Shiley airway portfolio, and our response during an unprecedented global pandemic, a time when the world looked to us for solutions. Over the years, our collective efforts have positively impacted thousands of patients, creating memories we will always cherish."
It is reported that Ariel MacTavish has worked in the medical device industry for more than 25 years, including 15 years at Johnson & Johnson and 12 years at Medtronic.
During her tenure at Johnson & Johnson, she served as the Global Marketing Director of Ortho Clinical Diagnostics and the Director of Wound Closure Products at Ethicon. After joining Medtronic in 2012, she also held several key positions in the company, such asVice President and General Manager of Respiratory Interventions, and Vice President of Global Marketing for Respiratory Interventions, currently President of the Respiratory Interventions Business Unit at Medtronic.

But in fact,This division has always had a low profile in Medtronic's vast business portfolio. The global shortage of ventilators caused by the rampant COVID-19 pandemic in 2020 brought a brief moment of prominence to this business.
At that time, the global ventilator companies had insufficient production capacity, and Medtronic even made a surprising move by directly...Medtronic Discloses Full Intellectual Property of Its Portable Ventilator Puritan Bennett™ 560: Including design schematics, production specifications, instructions, software code, etc., feel free to copy the homework.
At that time, during the ventilator investment boom, many manufacturers in China worked tirelessly to study the blueprints of this ventilator, which had already entered the market in 2010. This not only demonstrated Medtronic's social responsibility but also directly increased the brand recognition of their own ventilators.
However, as the pandemic fades, sales of ventilators, monitors, and other products have shown a decline, according to financial reports.In Medtronic's Medical Surgical portfolio for the fiscal year 2023 (ended April 28, 2023), the revenue of the Renal Care Solutions business in the Respiratory, Gastrointestinal, and Renal division was $2.77 billion, a decline of over 10% compared to last year’s $3.08 billion. This represents the highest revenue decline among all business segments.

Another media outlet pointed out,In this year, the sales of Medtronic's ventilator business dropped by more than 50%.
Benefits Will Increase After the Merger
Therefore, Medtronic decided to retain the PMRI business unit and discontinue the ventilator business (a sub-unit of the PMRI business). In this regard,J.P. Morgan analysts gave a positive evaluation, stating that although the new division is relatively small compared to the entire company, it is expected to achieve higher revenue growth.
As of now,The company has no intention of selling its ventilator business for the time being, but it is expected that the dominant manufacturers in the market will absorb it.
It is worth noting that,In recent years, Medtronic has been undergoing significant integration, especially after a slight decline in performance in the fiscal year 2023, marking a year of transformation for Medtronic.Not only has it made continuous major moves to divest, but it has also announced layoffs, cost reductions, and growth plans.
Department Merger
Public information shows,Since 2021, Medtronic has split its business into 20 operating divisions and simplified its operational model to strengthen its portfolio and capital allocation processes.。
On February 1, 2023, Medtronic underwent an internal reorganization, merging its surgical robotics and Surgical Innovations business units to form the Surgical Portfolio.The company said that the move aims to strengthen its position in the rapidly growing surgical market, which is expected to double in size over the next decade.
On March 7, 2023, the seven teams of Medtronic's Cardiovascular Business Unit in China were merged into three.Cardiac rhythm management, cardiovascular diagnostic services, cardiac surgery, and cardiac ablation solutions as one; structural heart, aortic, and peripheral vascular health as the second; and finally, coronary and renal denervation.
Medtronic then planned to consolidate six logistics centers into two to increase additional capacity.

Business Divestiture
In October 2022, Medtronic announced that it would spin off its Patient Monitoring and Respiratory Interventions businesses into a new company (“NewCo”), to reinforce its leading position in medical technology and expand into new markets.However, as we have seen, the spin-off has now turned into a merger, and the merged department is Acute Care and Monitoring (ACM).
In April 2023, Medtronic spun off its Renal Care Solutions (RCS) business to DaVita, the largest renal care service provider in the United States.Including its dialysis access, acute therapy and chronic therapy portfolios, renal care-related product pipelines, as well as the associated global manufacturing, R&D teams, and facilities.The two will jointly form an independent new company, Mozarc Medical, focused on kidney care.

Layoffs and Pay Cuts
On April 12 this year, Medtronic announced job cuts at a factory in Sunnyvale, California, affecting 59 employees.The factory originally belonged to Epix Therapeutics, a developer of radiofrequency cardiac ablation technology that Medtronic acquired for $316 million in 2019. Medtronic plans to restructure and relocate the factory’s operations, eliminating all positions and transferring the production line to its catheter manufacturing facility, the Parkmore site, located in Galway, Ireland.
During the same period, Medtronic launched a voluntary early retirement incentive program in an effort to complete a significant cost-cutting plan before the end of the fourth quarter.Medtronic stated in its public announcement that the Voluntary Early Retirement Program (VERP) is a "limited opportunity for early retirement with enhanced benefits" and a way for the company to avoid layoffs.At the same time, Medtronic hopes to fully spin off some of its business units.

In August, Medtronic disclosed the compensation of its executives and employees. The data showed that the compensation of Geoff Martha, Chairman and Chief Executive OfficerA 14% decrease in salary compared to the previous year,For $15.4 million (approximately RMB 112 million);The median salary of employees also decreased by 14%.Amounting to $67,073 (approximately RMB 490,600).
In response, Medtronic stated that it was due to "financial performance falling below the company's target expectations." The company has already adjusted its business strategy.It is expected that this year's performance will be flat, and in the future, it will return to a growth rate in the high single digits to double digits.
Shut Down Production Base
January 2024, MedtronicChairman and CEO Geoff Martha recently said at the J.P. Morgan Healthcare Conference that, as part of the company's restructuring efforts to improve profit margins,Medtronic Plans to Close More Than Five Manufacturing Sites and Six Distribution Centers, and Cease Business with Nearly 200 Suppliers.
In response, Medtronic stated that it was due to "financial performance falling below the company's target expectations." The company has already adjusted its operating strategy.It is expected that this year's performance will be flat, and in the future, it will return to a growth rate in the high single digits to double digits.

Investment Factory
September 2023,Medtronic announces the establishment of a 1 million square-foot manufacturing and logistics center in Memphis, Tennessee.Located at 5300 Aviation Drive, south of Memphis International Airport,And employs approximately 265 employees.
According to reports,Medtronic is evaluating the consolidation of its six logistics distribution centers in the United States into two.To improve customer experience and logistics efficiency.One of them is the 1-million-square-foot factory invested in this time, which Medtronic is building in collaboration with logistics company CEVA. Upon completion, Medtronic will use 300,000 square feet of the facility for manufacturing, surgical instruments, product packaging, and assembly operations, while the remaining 700,000 square feet will serve as Medtronic's logistics warehouse.
In September 2023, Medtronic's subsidiary Medtronic Canada ULC joined forces with AI startup FluidAI Medical to enter the home monitoring field.The two parties have reached a cooperation and will jointly participate in the Continuous Connected Patient Care (CCPC) project under Canada's Digital Technology Supercluster, with the goal of comprehensively revolutionizing and improving Canada's healthcare system.
In general, inpatients, especially those with severe complications, are often kept under observation for a period of time after their condition stabilizes. However, the average cost of hospital care can be as high as $1,000 to $2,000 per person per day, which not only increases the financial burden on patients but also occupies hospital resources.
The original intention of the CCPC project was to solve this problem.The goal is to achieve uninterrupted care from hospital to home by developing new predictive analytics, artificial intelligence, and home monitoring technologies integrated with hospital systems.

In addition,Geoff Martha also announced this year the establishment of Medtronic's Artificial Intelligence Center of Excellence.He stated, "This is to leverage the general artificial intelligence platform in the company's product portfolio, such as Medtronic's GI Genius endoscope. It has nothing to do with ChatGPT. Medtronic must train its models using a large amount of high-quality data.""But the future impact is astonishing."
According to what Medtronic had previously announced"The strategy of improving labor productivity by at least 5% through 'lean processes and performance culture' is expected to further implement measures such as supply chain optimization and digitalization to continue cost reduction and efficiency improvement policies."Improve profitability. Instrument House will continue to follow up.
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