In the four months since Geoff Martha became CEO of Medtronic PLC, he has laid out ambitious goals for what claims to be the world’s largest medical device company.
During Dublin, Ireland-based Medtronic‘s first-quarter earnings call this week, the new CEO said the company’s management will outline plans in the coming weeks for a “new Medtronic” that is more nimble and competitive. Martha touted the pipeline of products the company has built, saying that it was time to play offense and expand market share now that the pipeline is kicking in.
“We’re determined to make this pipeline count, not just for patients, our customers, but [also] for shareholders,” said Martha. He later added: “Over time, longer-term, we want to put the ‘tech’ in medtech. And we want to shift, we want to pool in some of these digital technologies to change our offerings.”
In a research note, Raj Denhoy and other Jefferies Financial Group Inc. analysts described Medtronic’s (NYSE:MDT) strategy as “turning the battleship.”
“It is certain to remain a debate: Can MDT, which has been struggling to consistently achieve even 5% growth the past several years, hope to sustainably grow faster?” they wrote. “How will that be married against profitability? The pipeline is full, and recent acquisitions set MDT on the right footing, making execution the linchpin.”
Martha outlined several technologies that could be key to Medtronic’s growth.
Medtronic pursues lead in robotic surgery
The Jefferies analysts said they expect Medtronic’s minimally invasive therapies group to lead and perform better than the company’s average. A key to the group’s strategy is Medtronic’s new Hugo system, which is intended to rival Intuitive Surgical Inc.‘s da Vinci SP.
Martha said this week that his company has been able to manage through previously disclosed disruptions related to COVID-19 — as well as resolving software issue. The plan is to file for a CE Mark in Europe and an Investigational Device Exemption from the U.S. Food and Drug Administration in early 2021.
“We’re going to be a meaningful player in this market. Go big or go home,” Martha said.
In the orthopedics space, Medtronic is looking to add enhancements to its Mazor X spinal robotic system.
Martha sets sights on surgical AI
Medtronic is looking to further enhance its robotic surgery play after its acquisition earlier this year of surgical artificial intelligence company Digital Surgery.
“We’re integrating their technology into our soft-tissue, robotic-assisted surgery system and also intending to use their surgical video management and clinician decision-support solutions beyond robotics,” said Martha. “In fact, we plan on a limited launch this fall for the Touch Surgery Enterprise, which is an extremely easy-to-use, surgical video-capture solution, paired with a computer and connected to the cloud.”
Medtronic also has a pending purchase of Medicrea International, whose technology incorporates AI into surgical planning for spine cases. It then uses those plans to create personalized spinal implants.
“With Medicrea, Medtronic will be the first company to offer an integrated spine surgery solution that includes AI-driven surgical planning, personalized implants, and robotic-assisted surgical delivery,” Martha said. “This further extends our competitive advantage in Spine.”