Shareholders get a look at new Medtronic boss

  • Article by: JANET MOORE , Star Tribune
  • Updated: August 25, 2011 - 9:13 PM

At the company's annual meeting, Omar Ishrak emphasized the need for better execution and a broader global reach.

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New Medtronic CEO Omar Ishrak

Photo: Glen Stubbe, Star Tribune

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Since he was named chief executive of Medtronic Inc. two months ago, Omar Ishrak has spent most of his time traveling around the world, meeting employees and customers.

On Thursday, he met the Fridley-based medical technology company's shareholders for the first time.

Several attending the company's annual meeting asked decidedly pointed questions of the General Electric alumnus, which he handled with aplomb.

When asked about Medtronic's controversial payments to doctors who serve as consultants, a practice that has attracted investigations by Congress and the Department of Justice, Ishrak said physician input is essential to making better medical devices.

He said "controls are in place" to thwart any improper payments and that Medtronic has become a leader in transparency. The payments are revealed on the company's website.

"We will never compromise on our integrity," Ishrak said.

Another shareholder asked whether Medtronic's insulin pumps are vulnerable to hacking -- a feat demonstrated recently at a cybersecurity conference that highlighted potentially deadly security concerns.

Ishrak said the risk is small and that security will be considered in pump design going forward.

Two promotions revealed

The company also named two new members of Ishrak's management team. Rob ten Hoedt, a 20-year Medtronic veteran, was promoted to senior vice president and president of western Europe and Canada. Geoff Martha was named senior vice president/strategy and business development, coming to Medtronic from GE Healthcare.

Much of the hourlong meeting was devoted to Ishrak's talk outlining his goals for the $16 billion company: better execution, more innovation and a broader global reach for its products. He emphasized that Medtronic's products must provide economic value to its customers. "In health care, technology is often seen as the culprit that drives up costs," he said, noting that the products must be seen "as part of the solution, not part of the problem."

It was similar to a speech given to Wall Street analysts during a conference call Tuesday, which drew largely positive comments from analysts -- mostly.

"We see more positives than negatives in [Ishrak's] stated vision," said David Lewis, an analyst with Morgan Stanley. "But execution is more important than vision, and results will be measured in years, not quarters."

At the annual meeting, Ishrak worked from a script -- scrolled to him on a teleprompter -- but he deviated every now and then.

He joked that his son, a law school student at the University of Minnesota, was "thrilled to have his parents move in with him."

Ishrak also hinted of his childhood in his native Bangladesh when discussing the global need for better medical technology.

"Growing up in Bangladesh I was keenly aware of people who were deprived of basic human health care needs," he said.

Medtronic's mission of healing and restoring health should not be limited to wealthy nations, he said. "It applies to all people."

Janet Moore • 612-673-7752

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