QUOTE AND NEWS
SeekingAlpha  Aug 12  Comment 
By Alexander Teicher: Background On June 15, 2014, Medtronic Inc. (NYSE:MDT) announced that it had agreed to buy Covidien PLC (NYSE:COV) for $42.9 billion in cash and stock. While COV shares initially traded at an approximately 5% discount to...
Jutia Group  Aug 11  Comment 
[Thomson Reuters ONE] - MINNEAPOLIS - Aug. 11, 2014 - Medtronic, Inc. (NYSE: MDT) announced today it will report financial results for the first quarter of its fiscal year 2015 on Tuesday, August 19, 2014. A news release will ... Read more on...
StreetInsider.com  Aug 7  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Medtronic+%28MDT%29+Receives+FDA+Approves+for+Certain+Attain+Performa%2C+Viva+Quad+Products/9731201.html for the full story.
Jutia Group  Aug 7  Comment 
[Thomson Reuters ONE] - New System Helps Physicians Deliver Cardiac Resynchronization Therapy Optimally and Efficiently to Heart Failure Patients MINNEAPOLIS - Aug. 7, 2014 - Medtronic, Inc. (NYSE: MDT) today announced it has ... Read more on...
TheStreet.com  Aug 6  Comment 
NEW YORK (TheStreet) -- Shares of medical device and drug maker Covidien are falling after multiple media outlets reported that the Treasury Department is looking into ways of curtailing tax inversion deals. Covidien has agreed to be acquired by...
Clusterstock  Aug 5  Comment 
The Obama administration said Tuesday it was reviewing potential administrative actions to limit stop companies' so-called tax inversion deals, after Sens. Dick Durbin (D-Illinois), Jack Reed (D-R.I.), and Elizabeth Warren (D-Massachusetts) sent a...
MarketWatch  Aug 5  Comment 
The corporate tax system is broken, and tweaking it to address tax inversions isn’t enough. Two tax experts offer reform ideas, including scraping the system entirely and taxing shareholders directly.
Jutia Group  Aug 1  Comment 
[Thomson Reuters ONE] - System Offers Innovative Technology for Sinus Surgery. Chronic Sinusitis Affects Nearly 29 Million US Adults MINNEAPOLIS - August 1, 2014 - Medtronic, Inc. (NYSE: MDT) today announced the launch of the ... Read more on...
StreetInsider.com  Jul 28  Comment 
Visit StreetInsider.com at http://www.streetinsider.com/Corporate+News/Medtronic+%28MDT%29+PRESTIGE+LP+Cervical+Disc+System+Approved+by+FDA/9694343.html for the full story.
Jutia Group  Jul 28  Comment 
[Thomson Reuters ONE] - MRI-Guided Laser Ablation Technology Adds to Surgical Technologies Product Portfolio and Broader Neuroscience Leadership Position MINNEAPOLIS - July 28, 2014 - Medtronic, Inc. (NYSE: MDT) today announced ... Read more on...




 

Medtronic (NYSE:MDT) is the world's largest medical device company. MDT is best known for its pacemakers but also produces a wide range of other medical devices, including external defibrillators, insulin pumps and image guided surgery systems.

Business Overview

Business & Financial Metrics[1]

In 2010, MDT generated a net income of $3.10 billion on revenues of $15.81 billion. This represents a 49.7% increase in net income on a 8.4% increase in revenues from 2009, when the compoany earned $2.07 billion on revenues of $14.60 billion.

Business Segments[2]

MDT operates in seven main divisions that are aggregated into a single operating segment:[2]

  • Cardiac Rhythm Disease Management: MDT is the world’s leading supplier of pacemakers.[3]
  • Spinal: spinal products and image guided surgery systems that are used by surgeons during precision cranial and orthopedic surgeries. [4]
  • CardioVascular: products and therapies such as stents which are to treat coronary artery disease, aneurysms, and peripheral vascular disease. [5]
  • Neuromodulation: devices for the treatment of neurological, urological, and gastrointestinal disorders. One of the main devices is a neurostimulation system, which is about the size of a stopwatch and can be implanted under the skin to deliver electrical pulses to the spinal cord. [6]
  • Diabetes: devices such as external insulin pumps and glucose monitoring (CGM) systems for maintaining control of glucose levels and supporting the treatment of diabetes. [7]
  • Surgical Technologies: products used for procedures such as heart valve repair and replacement. These include perfusion systems, which oxygenate and circulate a patient’s blood during heart surgery, and products used for the repair and replacement of heart valves, etc.[8]
  • Physio-Control: products such as external defibrillators which are used on victims of cardiac arrest. [9]

Key Trends and Forces

Medicare coverage patterns

Health coverage is an important determining factor when patients and doctors choose among various treatment options. Medicare coverage is particularly significant in that it directly affects over forty million Americans, how much patients have to pay for Medtronic products, and how much Medtronic will receive in payments from Medicare. Currently, Medicare and other third party payors are emphasizing more cost-effective medical devices, by limiting the reimbursement they will cover. Furthermore, even if a new medical device is cleared by the FDA, Medtronic faces limited demand for the device until Medicare and other payors approve the device for reimbursement.

Government Regulation

Medtronic and its competitors are all heavily affected by government regulation, especially by the FDA, which is responsible for regulating food, dietary supplements, drugs, medical devices, and other products in the United States. Without FDA approval, Medtronic cannot sell any of its medical devices to the public. If any of Medtronic's devices fail FDA approval, it can adversely affect the company's sales.

Diabetes

Diabetes currently affects around 200 million people worldwide, including 21 million people in the U.S. It is estimated that more than $132 billion is spent annually on diabetes and its complications. One of the key risk factors for diabetes is obesity, which has been on the rise in the United States. MDT currently has several products that serve the diabetic market, and it represents an opportunity for MDT to generate additional revenue in this large and expanding market.

Saturation of Implantable Cardiac Rhythm Devices (ICD) Market

ICDs are stopwatch-sized devices that monitor the heart and deliver appropriate therapy when an abnormal heart rhythm is detected. Medtronic holds over 50% market share for ICDs and this product contribute about 25% of Medtronic's sales. ICDs usage has grown substantially over the years, due to trial results which showed ICDs reduced death by 23% in people with moderate heart failure compared to those who did not receive ICDs. [10] However, growth in this market has been declining recently as the patient population which ICDs serve is substantially penetrated. If MDT can't sell as many ICDs as it has in the past, its sales may be adversely affected.

Competition

MDT faces strong competition in nearly every segment that it operates in. Primary competitors in their various business lines include:

References

  1. MDT 2009 10-K pg. 85  
  2. 2.0 2.1 MDT 2009 10-K pg. 1  
  3. MDT 2007 10k, Pg 2
  4. MDT 2007 10k, Pg 5
  5. MDT 2007 10k, Pg 9
  6. MDT 2007 10k, Pg 13
  7. MDT 2007 10k, Pg 15
  8. MDT 2007 10k, Pg 16
  9. MDT 2007 10k, Pg 20
  10. MDT 2007 10k, Pg 4
  11. MDT 2007 10k, Pg 2
  12. MDT 2007 10k, Pg 5
  13. MDT 2007 10k, Pg 9
  14. MDT 2007 10k, Pg 13
  15. MDT 2007 10k, Pg 15
  16. MDT 2007 10k, Pg 16
  17. MDT 2007 10k, Pg 18
  18. MDT 2007 10k, Pg 20
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