When Omar Ishrak became CEO of Medtronic seven years ago, the medical device maker had 45,000 employees, $16 billion in sales and a global corporate mailing address just a few miles north of the famous boxcar garage in northeast Minneapolis where Earl Bakken co-founded the company with his brother-in-law, Palmer Hermundslie. Today the company has more than 85,000 employees and $30 billion in sales.
The mailing address is in Dublin, Ireland, thanks to a controversial “inversion” deal in 2015 in which Medtronic acquired medical supplier Covidien for $50 billion and then housed the combined company in Covidien’s former global HQ.
This month, Ishrak gave a lecture to the Economic Club of Minnesota in which he discussed how the work that Medtronic is doing today, like inventing cardiac devices that don’t require leads to deliver current to ailing hearts, stems directly from Bakken’s bold thinking in business and pacemaker engineering.
Ishrak displayed a photo of the old Hermundslie garage amid snow piles, and later showed a possible evolution of future “leadless” heart devices, from today’s simple single-chamber Micra pacemaker, to dual-chamber pacemakers, then biventricular pacemakers known as CRT-Ps, and finally to biventricular implantable defibrillators known as CRT-Ds.
Below is an edited transcript of remarks that Ishrak gave in private to reporters after his talk.
Q: I noticed you had a leadless CRT-D device on the screen. Is that a real thing?
A: That’s the future.
Q: Right, but that’s a real project that’s being worked on?
A: Yeah, all those projects are being worked on. But we’re trying to move from the pacemaker we already have available [the Micra]. The vision here is to convert heart devices to all leadless over a period of time. I’m talking about decades here, I’m not talking about tomorrow. The first progression took 60 years. Now this will be quicker, but this is not something you do that quickly.
Q: Medtronic promised to create jobs in Minnesota following the Covidien deal. Do you have an updated number for the net job changes in Minnesota since the deal?
A: It’s over 500 more. And I think it’s actually quite a bit above 500 — if you include temporary labor as well, it’s actually quite a bit more. But it’s certainly 500 permanent jobs, net. It’s actually more than that now. We promised 1,000 [more jobs in Minnesota] … in five years. And we just completed year three. So we’re well on track for that.
Q: Can you offer any more visibility into that number?
A: A lot of that, remember, were people that we moved, some of the headquarters functions that were in Boston, the U.S. headquarters [of Covidien]. So that was a natural increase there.
Q: You mentioned the Hermundslie garage and the picture of the snow. People are always asking me, would Medtronic ever move its global headquarters back to Minnesota?
A: Well, I don’t know. There’s got to be a good reason. But right now, look — our people are still here. We still view this as our headquarters. This is where I am, this is where all of our people are. This is where we have all our meetings, we bring customers in, we do everything here. So operationally there really is no difference. That’s a legal label, if you like. At that time it made sense, and I think there’s got to be a good reason why we would do that. So at this stage, you know, this is the way we think about it, and that doesn’t exactly preoccupy us.
Q: Minnesota gets a lot of prestige out of having a big global headquarters here. But that’s not a motivating reason?
A: No. But I think Minnesota still thinks we are here. That’s why I’m speaking here. It’s absolutely our largest base of operations. We have more than 10,000 employees [in Minnesota].
Q: Do you have folks who are looking at the tariffs that have been proposed recently — the Trump tariffs on China that have been in the news?
A: We always look at it. We’re not in the middle of that stuff, so, you know, we watch it, but there’s not too much we can do about that.