Medtronic 2008 Annual Report Download - page 6

The theme of this year’s annual report is “Expanding Our Role.” For years, Medtronic has been the leader of the medical
technology sector. Now, we are becoming more. As we enter a new era of healthcare, we are helping to shape what
“quality” healthcare means for patients. We are more than a provider of medical devices that save and improve lives. We
are the world leader in understanding the role medical technology plays in diagnosing, treating, monitoring and
preventing a host of chronic diseases that interfere with the quality of human life and cost the healthcare system billions
of dollars annually. The solutions to many of the toughest healthcare problems will only be resolved when the public
and private sectors work together to address tough issues such as patient access, quality and cost. Medtronic will continue
to expand our leadership and meet these challenges head on.
A Year of Milestones
This fiscal year was very special for the company, as we celebrated a number of important milestones that illustrate
Medtronic’s history of innovation, and commitment to improving and saving lives. Certainly one of the most significant
was the 50th anniversary of the development of the first battery-powered pacemaker. In recognition of this achievement
and his many contributions to medical science, the University of Minnesota awarded Medtronic founder Earl Bakken an
honorary Medical Degree (M.D.)—something they have never done before. Dr. Bakken’s contribution to medical care is
legendary, as millions of lives have been saved or improved by the company he started.
We also celebrated 25 years of innovation in our Diabetes business and surpassed the $1 billion mark in annual
sales in this sector for the first time. And, our Neuromodulation business, which has provided service to patients for more
than 30 years, expanded therapies for chronic pain, gastroenterology, urology and a broad range of neurological
movement disorders.
Medtronic has truly come a long way from its humble beginnings. Our Mission, which was written by Earl in 1960,
directs us to apply biomedical engineering to alleviate pain, restore health and extend life. We’ve grown from a small
pacemaker company to the world’s largest independent medical technology company, with therapies and diagnostic
devices that now touch many important chronic conditions. Today, about every 5 seconds, a Medtronic product is used
to save or substantially improve someone’s life somewhere in the world. In the future, as we expand our role further,
those lives will be changed in even more meaningful ways.
A great example is Barbara O’Deady, pictured with me at right, who received an Endeavor drug-eluting coronary stent
in the United States soon after FDA approval. I had the pleasure of hearing firsthand what a difference Endeavor has made
in her life. Barbara is an energetic 75-year-old woman who has always been health conscious. She practices yoga and
has a great attitude on life, so when she would experience tightness in her chest, she would try to calm herself down
until the feelings went away. But the episodes were increasing. Finally, Barbara sought a medical opinion. Doctors
discovered a 98 percent coronary artery blockage and recommended an Endeavor stent. Barbara told me she can’t believe
how much better she feels now. “I’ve always been young at heart, but I noticed how much more energy I have with the
stent. It’s a relief not to worry anymore,” she said.
Barbara is just one of millions of patients who now benefit from a Medtronic product.
Record 2008 Results
In fiscal year 2008, we carried out our Mission while strengthening our financial position. We grew revenue by 10 percent
to $13.515 billion. Net earnings and diluted earnings per share for the year were $2.231 billion and $1.95, respectively. After
adjusting for special, restructuring, certain litigation and IPR&D charges, fiscal year 2008 net earnings and diluted earnings
per share were $2.973 billion and $2.60, respectively.
Innovation continues to be the lifeblood of our company and was central to our strong performance. In the last year,
we launched a number of important new products, including Prestige, our Spinal business’ new cervical artificial
disc—the first of its kind to be approved in the United States; CardioVascular’s Endeavor, the first of the long-awaited
“second generation” drug-eluting coronary stents in the United States; and Neuromodulation’s RestoreULTRA, the smallest
and thinnest rechargeable neurostimulator, which has quickly become the most widely used system in the market.
Within the Diabetes business, our Guardian REAL-Time continuous glucose monitoring system helped us continue the
march towards an automated closed-loop insulin delivery system. In Cardiac Rhythm Disease Management (CRDM), more
than 250,000 patients have been enrolled on our remote CareLink network.
Dear Shareholders,
2