The $50 billion Medtronic-Covidien merger was strangely absent of disruptive plant and facility closures. Until now. Earlier this month, Medtronic revealed a plan to shutter Covidien's former headquarters in Mansfield, MA. Just learned are its intentions to relocate two manufacturing lines in Gunbarrel, CO, to an undisclosed location.
Medtronic has said that operational changes would be on the way after sealing its $43 billion tax inversion deal with Covidien last year, and some of those are still trickling in. The company is planning to shut down an office building at Covidien's Massachusetts headquarters as part of its restructuring following the merger.
Former Covidien head Jose Almeida, who seized the reins at Baxter at the start of the year, offered an early glimpse of his long-term strategy for the company after spinning off the biopharma Baxalta last year. On a Feb. 2 earnings call, he laid out his priorities as trimming operating expenses, reallocating capital to support innovation and growth, and making smaller acquisitions.
Medtronic inherited Covidien's tax-friendly Irish domicile last year after the companies finalized their $50 billion merger. But the devicemaker also picked up a tax scuffle from Covidien's former parent company, and now, Medtronic is laying that battle to rest in the form of a $525 million settlement.
Medtronic announced that it will build a €13 million ($14.3 million) facility in Galway, Ireland, to manufacture its fast-selling In.Pact Admiral drug-coated balloon for peripheral artery disease.
The U.S. Food and Drug Administration has issued a safety communication regarding a wide array of intravascular implanted devices and delivery tools that have coatings designed to reduce friction and improve maneuverability.
Cue the Medtronic-Covidien layoffs. Medtronic is cutting 150 jobs in Ireland, months after closing its megadeal with Covidien and shifting its domicile to the country to enjoy the benefits of a lower tax rate.
Baxter had scarcely completed its July separation from therapeutics business Baxalta when it suddenly became a target for activist investor Third Point in early August. Last month, Baxter offered an olive branch to the hedge fund by adding two new directors to its board, one of them from the firm.
The FDA warned of a Covidien ventilator that may not deliver enough air, and another one from Dräger Medical that has faulty batteries. The ongoing corrective actions of about 2,700 units of the devices have been deemed Class 1, a designation reserved for situations "in which there is a reasonable probability that the use of or exposure to a violative product will cause serious adverse health consequences or death."
None of the giant med tech acquisitions that have closed recently have resulted in a reduction in employee count yet. Not Medtronic-Covidien, Zimmer-Biomet, nor Becton Dickinson-CareFusion. But the rumors are already swirling on where all the anticipated cost savings and reduduncies will be found. That's according to the latest jobs data from EP Vantage.