Medtronic 2012 Annual Report Download - page 26

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The charts below set forth net sales of our Surgical Technologies products as a percentage of our total
net sales for each of the last three fiscal years:
Customers and Competitors
The primary customers for our products relating to ENT diseases and conditions are ENT surgeons and
the hospitals and clinics where they perform surgery. Competitors in this part of our Surgical Technologies
business include Gyrus ACMI (a group company of Olympus Corporation), Stryker Corporation, and
Johnson & Johnson.
The primary customers for our neurosurgical products are neurosurgeons, spinal surgeons, and the
hospitals and clinics where they perform surgery. Competitors include Johnson & Johnson, Stryker
Corporation, and Integra LifeSciences Holdings Corporation.
The primary customers for our image-guided surgery and intra-operative imaging systems are hospitals
and clinics. Competitors include BrainLAB, Inc., Stryker Corporation, GE Healthcare, Siemens Medical
Solutions USA, Inc., and Philips Medical Systems.
The primary customers for our advanced energy products are orthopedic surgeons, spinal surgeons,
neurosurgeons, and the hospitals and clinics where they perform surgery. Competitors include Covidien,
Johnson & Johnson, and ArthroCare Corporation.
Research and Development
The markets in which we participate are subject to rapid technological advances. Constant improvement
of products and introduction of new products is necessary to maintain market leadership. Our research and
development (R&D) efforts are directed toward maintaining or achieving technological leadership in each
of the markets we serve in order to help ensure that patients using our devices and therapies receive the most
advanced and effective treatment possible. We are committed to developing technological enhancements
and new indications for existing products, as well as less invasive and new technologies to address unmet
patient needs and to help reduce patient care costs and length of hospital stays. We have not engaged in
significant customer or government-sponsored research.
During fiscal years 2012, 2011, and 2010, we spent $1.490 billion (9.2 percent of net sales), $1.472 billion
(9.5 percent of net sales), and $1.424 billion (9.3 percent of net sales) on R&D, respectively. Our R&D
activities include improving existing products and therapies, expanding their indications and applications for
use, and developing new products. During fiscal year 2012, we have focused on optimizing innovation,
including improving our R&D productivity.We have made efforts to reallocate resources into driving growth
in emerging markets and in evidence generation for our growth platforms, and are assessing our R&D
programs based on their ability to deliver economic value to the customer.
Acquisitions and Investments
Our strategy to provide a broad range of therapies to restore patients to fuller, healthier lives requires
a wide variety of technologies, products, and capabilities. The rapid pace of technological development in
the medical industry and the specialized expertise required in different areas of medicine make it difficult
for one company alone to develop a broad portfolio of technological solutions. In addition to internally
9
Surgical
Technologies
$1,254
All Other
$14,930
Fiscal Year 2012
(dollars in millions)
Surgical
Technologies
$1,036
All Other
$14,472
Fiscal Year 2011
(dollars in millions)
Surgical
Technologies
$963
All Other
$14,429
Fiscal Year 2010
(dollars in millions)
6%
94%
7%
93%
8%
92%