Medtronic Cardiac and Vascular Investor Day Presentation

8/15/2019 Medtronic Cardiac and Vascular Investor Day Presentation

1/26

INVESTOR DAYJUNE 6 2016

NEW YORK CITY


2/26

MIKE COYLEEVP & GROUP PRESIDENTCARDIAC AND VASCULAR

GROUP


3/26


4/26

2016 Investor D

KEY TAKEAWAYS

THERAPY INNOVATION

ECONOMIC VALUE

GLOBALIZATION

CVG will sustain Therapy Innovation across all b

by the changes we have made in culture, struct

processes led by the most innovative talent in t

Our lead in developing Services and Solutions p

form of “CVG Solutions” programs, CLMS, Dia

and Patient Management Services is Significan

Multi-Line Contracting and VBHC Episode of C

create a “share capture bias” for our overall pro

Our Global Footprint, Breadth and Scale give us

Advantage in driving emerging market therapy

market share


5/262016 Investor D

CVG GROUP STRUCTURECUSTOMER FOCUSED WHILE CAPITALIZING ON SIZE AND SCALE

Coronary & StructuralHeart (CSH)

Cardiac Rhythm & HeartFailure (CRHF)

Cardiac & Vascular GroOperations, Quality, Clinica

B u s i n e s s

U n i t

T h e r a p y / P h y s i c i a n

f o c u s e d

G e n e r a l M a n a g

e r s

G r o u p

Heart Failure

Brady

Tachy

AF Solutions

Diagnostics

Connected Care

Coronary and RenalDenervation

Heart Valve Therapies

ExtracorporealTherapies

CRHF

APV

CSH

FY16:

$10.2B

CRHF: +10%

CSH: +9%

APV: +10%

CVG: +9%

Growth Rates: Constant Currency Growth at 53wks

Constant currency growth benefited by approximately

1.5 percentage points for extra week.

Balanced growth across all businesses with

CC growth at the high end of our targeted

Mid-Single Digit growth range


6/262016 Investor D

Weighted Average Market Growth Rate (WAMGR)*: Forward looking 5 year market projection.

CVG MARKET – MOVING TO MORE RAPIDLY GROWING SEGMENTS

3.8 3.5 3.7

3.4 3.2 3.4

3.2 3.3 3.5

6.2 6.2 6.5

1.5 1.6 1.7

1.5 1.61.71.4 1.82.2

3.2 4.4

6.12.13.4

5.0

0.1

2.5

4.6

0.0

0.8

1.5

FY11 FY16 FY21

Diagnostics

TCV

CRHF AF

Peripheral/eV

Aortic

ECT

Surgical Valves

Coronary

HF / CRT

Tachy

Brady

13%

8%

7%

4%

1%

1%

1%

1%

14%

$40.0B

$26.4B

1%

CardiovascularMarket CAGR

~4%

$32.3B

1%

60%

40%

50%

50%

75%

25%

Implantables,

Coronary & Core

Structural Heart

Market CAGR~1%

“All Other”

Market CAGR~9%

FY16

WAMGR

FY11

~ 4 - 5%

~ 2 - 3%

WAMGR

FY16 – FY21 CAGR

CARDIOVASCULAR MARKET GROWTH ESTIMATES

MARKET COMPOSITION

CVG PORTFOLIO GROWTH

WAMGR*

CVG Growth shown is Constant Currency Growth at 53wks


7/26

2016 Investor D*IPUs: Integrated Practice Units

CVG’S EVOLVING CUSTOMER

*IPU’s – Integrated Practice Units

An increasingly complex therapy and brand decision making pr

favors companies with breadth, scale and services capabilit

FPre FY05 2005 - 2010 2010 - 2015 2015 & beyond

+ Materials Manager

+ CardioVascular Line Administrator / Hospital C-

+ Multi-specialty Clinical Prac

Increasingly

Interventional Physician / Surgeons


8/26

2016 Investor D

MEDTRONIC CORE STRATEGIES

CVG Services and Solutions OptimOutcomes, Access, Costs and Efficie

Driving Growth with Geographic Expaand Therapy Penetration

Leading with Unrivaled Breadth, ScaTechnology Innovation

TherapyInnovation

Globalization

EconomicValue


9/26

2016 Investor D

CVG STRATEGY

Diagnostic and ReferralManagement Services

Cath Lab ManagedServices

Intrepid™

FFR

Arctic Front

Advance®

ExtravascularICD

RevealLINQ™

Micra™TPS

TYRX®AIGISRx®

SEEQ™

CardioInsight

Evolut™PRO

(ISR/AVF)(SFA)

VenaSeal

Valiant® Evo

HawkOne 7F/6F

Valiant®Mona LSA Valiant®

TAAA

Avalu

VisiaTM AF / MRI

Enveo®

IN.PACT® Admiral


10/26

2016 Investor D

SUSTAINABLE THERAPY INNOVATION

Leading with Unrivaled Breadth, ScaTechnology Innovation

TherapyInnovation

CRHF CSH

Culture, Structure and Process Changes to Institutionalize Innovation in Prod


11/26

2016 Investor D

DRIVERS OF IMPROVEMENT IN CVG PIPELINE PRODUCTIVITY

Peripheral VascularDisease

General Cardiologist

Rigorous Prioritization to Balance Investment, Cadence, Risk and Ov

Interventional

Cardiologist

Cardiothoracic

SurgeonInterventional

Radiologist

Vascular

Surgeon

Interventional

Cardiologist

Cardiothoracic

SurgeonElectro

General Cardiologist General Cardiologist

Disease/IPUfocused BusinessUnit Leaders

Therapy/Physicianfocused GeneralManagers

Interventional

Cardiologist

Focus and Accountability for Therapy Innovation at the GM L

Reveal LINQ™ ICM

CoreValve™ TAVR

Transformative Innovation

Micra™ Pacemaker

Drug Filled Stent

Cr

AdaptivCRT®Algorithm

Onyx™

Evolut™ R and Evolut™PRO

MRI Safe Implantables

Polaris (HP Platform)

Orion (LP Platform)

Evolut® R /Enveo®Onyx™ DES

IN.PAC

SURTA

IN.PACT® Admiral DCB

Meaningful Iteration Scalable Platform Development Expanded Ind

Coronary ArteryDisease

Heart ValveDisease

ArrhTa

Sirius Programmer

O O S


12/26

2016 Investor D

THERAPY INNOVATIONSCONTINUED STRONG CADENCE OF MEANINGFUL GROWTH DRIVERS

CoreValve Evolut™ R XLEU H2 FY17 & US H1 FY18 T A

V R

FY16

IN.PACT® Admiral®US: H1 FY17 Sizes & Indications D

C B

FY17

M R I

C R T - D Compia

TM, AmpliaTM & ClariaTM

WW: Launching

D F S Drug

EU: F

Resolute Onyx™US: H1 FY18 D

E S

M R I

P a c e r

3T MRITM

WW: Launching

M R I

I C D Visia AF MRITM

WW: Launching

W i r e l e s s

P a c e r

AzureTM

EU H2 FY17

Micra™EU & US: Launching

L e a d l e s s

P a c e m a k e r

Value Segme

PRO

3T Clar ia

150 mm AVF 8-12mmISR

CRHF


13/26

2016 Investor D

CRHFMARKET OPPORTUNITY

GLOBAL CRHF MARKET ~$17B

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

FY16 FY17 FY18 FY19 FY20 FY21

Diagnostics

AF

HF/CRT

Tachy

Brady

$ B i l l i o n s

-

2.0

4.0

6.0

8.0

10.0

FY15 FY16 FY17E …

MEDTRONIC CRHF REVE

$ B i l l i o n s

CRHF IMPLANTABLES


14/26

2016 Investor D

CRHF IMPLANTABLESMEANINGFUL ITERATIONS AND SCALABLE PLATFORM DEVELOPMENT

NEW PLOW POWER

MRI (3T)

Expanding legacy 1.5T MRI devices to 3T

Launch: EU & Japan H2 FY16 & US H1 FY17

Expanding MRI (1.5T & 3T) portfolio tovalue segments

EU & US Launch H1 FY18

CRT-P Quad

Portfolio of quadripolar and bipolar devices

Wireless Bluetooth telemetry with mobile

patient app

Vector ExpressTM

Automated Test and

AdaptivCRTTM

functionality

Launch: EU H2FY17 & US/Japan H1 FY18

Low Power B

Lower product co

Smartphone ena

Patient engagem Modular softwar

feature iteration

Launch: (Azure™US H1 FY18, Jap

High Power B

Lower product co

Bluetooth and pa

Modular softwar

feature iteration

New, exclusive feresponse and pe

Launch: EU & US

Evera MRITM ICD(3T)

Expanding MRI Access: 1.5T and 3T

Improved image quality, improved diagnostics

and shorter MRI scans

Launch: EU & Japan H2 FY16 & US H1 FY17

MRI Safe CRT-D (3T)

Compatible with existing quadripolar leads

CompiaTM

/AmpliaTM

adds MRI functionality

Launch: EU /US Q4 FY16, Japan H1 FY17(Compia) & H2 FY17 (Amplia)

ClariaTM

adds EffectivCRTTM

Algorithm

Launch: EU Q4 FY16, US H2 FY17,

Japan H2 FY18 3T Launch for portfolio mid FY17

Visia AF MRITM

Single chamber ICD with capabilities to detect

Atrial Fibrillation

Adds LINQ functionality to VR ICDs

Launch: US H1 FY17 & Japan H2 FY17

“Extending MRI Leadership to 3T and Value Tiers”

HIGH POWER

CRHF LOW POWER TRANSFORMATIVE INNOVATION


15/26

2016 Investor D

CRHF LOW POWER: TRANSFORMATIVE INNOVATIONREDEFINING PACING WITH MICRA™ PACEMAKER AND ITS FUTURE DER

Micra VVIR Pacemaker World’s smallest pacemaker

Repositionable, tine-based fixation

Simpler, faster, safer and cost-effective

Approved for 1.5 & 3 T full-body MRI scans

First transcatheter pacemaker approved in

the U.S. Addresses 15-20% of Brady patients in VR

segment

FDA Approved (April 2016), Japan H1 FY18

SNDOnly30%

AVBOnly40%

AVB + AF16%

Other4%AVB +

AF16%

Micra AAIR

Micra VDDR

Micra

VVIR

Micra

VVIR

Micra VDDR / AAIR Pacemaker Leverages Micra Platform Technologies

Novel proprietary technologies for cross-

chamber sensing

Expands leadless to AV Block and Sinus Node

Dysfunction patients

Potential for even greater complicationreductions compared to dual chamber rates

Enables us to reach ~90% of Brady patients

Single Chamber:

VVIR= pacing and sensing the ventricle plus rate response featureAAIR= pacing and sensing the Atrium plus rate response feature

Dual Chamber:VDDR=dual chamber pacing and sensing the ventricle plus rate response feature

DDDR=dual chamber pacing plus rate response feature

CRHF HIGH POWER: TRANSFORMATIVE INNOVATION


16/26

2016 Investor D

CRHF HIGH POWER: TRANSFORMATIVE INNOVATIONEXTRAVASCULAR ICD ADDRESSES LIMITATIONS OF SUBQ

Limitations of conventional SubQ-ICD: Large & cumbersome, limited longevityand no ATP or Brady Pacing

Solution: Extravascular ICD

Provide benefits of traditional ICDs with the potential advantage of lead

placement outside the heart and vasculature.

Designed to deliver defibrillation therapy and anti-tachycardia pacing (ATP)

System will consist of a device , a newly designed lead, and procedure tools

to guide the efficient delivery of the system.

Spec Traditional ICD EV-ICD Conventional SubQ-ICD

Size ~30cc ~same size as TV-ICD ~ 2X size of TV-ICD

Max Energy 35J 40J 80J

ProjectedLongevity ~11 years ~10 yearsTV-ICD ~7 years

Features DefibrillationPost-Shock Pacing

ATPBrady Pacing

DefibrillationPost-Shock Pacing

ATPBrady Pacing

DefibrillationPost-Shock Pacing

LeadPlacement

Intravascular Extravascular(Substernal)

Subcutaneous(on top of ribs)

CRHF: AF DIAGNOSTICS INFECTION CONTROL SERVICES


17/26

2016 Investor D

Anti-In

Reduces impla

by 75-100% Incremental re

Cross Selling oStimulation &

Arctic Front Advance® Cryoablation Balloon

Short tip for improved ability to measure

TTI with Achieve Advance™ MappingCatheter

Full Launch: EU & US H1FY18

CRHF: AF – DIAGNOSTICS – INFECTION CONTROL – SERVICESTRANSFORMATIVE INNOVATION, MEANINGFUL ITERATIONS AND CLIN

DIAGNOSTICS INFECTAF SOLUTIONS

SE

Reveal LSEEQTM

SEEQ reimburs

and LINQ techfor monitoring

Heart Failure P

allows clinicianimplanted sens

self manageme Service revenu

Economic Valu

Reveal LINQTM ICM Collects timely biometrics for 3 years 1 in 5 LINQ’s for Syncope result in a

pacemaker implant

Launch: Japan H1FY17

LINQ IITM ICM Size Equivalent + New Smartphone Interface Bluetooth + New Sensors Low cost from waferscale manufacturing Launch: EU FY19

Remains Highly Underpenetrated

FIRE & ICE Clinical Results presented at ACC 2016 Primary efficacy and safety endpoints

met: cryoballoon PVI proven non-inferior

to point-by-point RF ablation, yet withsignificantly shorter procedure times

Secondary endpoints on Re-

hospitalization and Repeat AblationProcedures accepted for Presentation at

CardioStim LBCT session - June 9

US + WE Accessible Market*LINQ

Penetration

Syncope

CryptogenicStroke

AF Ablation

324,000FY16 24%

FY20 337,00036%

391,000FY20 18%

116,000FY20 17%

109,000FY16 7%

362,000FY16 7%

®

CSH: STRUCTURAL HEART


18/26

2016 Investor D

CSH: STRUCTURAL HEART

TAVR – INDICATION EXPANSION SURGITAVR

A

Pericardial tissu

Interior mounteplatform for dur

Flexible and durfor ease of use a

MRI Safe

Launch: EU H1 FJapan H2 FY18

GLOBAL TAVR MARKET ~$4B+

-

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

2015 2016 2017 2018 2019 2020 2021

Extreme Risk

High Risk

AcceleratingIntermediate/Low Risk

$ B i l l i o n s

SURTAVI

Submit Q4FY17

SURTAVI Inclusion: ≥3% mortality risk at 30d

Low Risk: < 3% mortality risk. 1,200 patients

randomized against SAVR

Low Risk

EnrollmentStarted

Current U.S.Indication

Low RiskIntermediate

Risk

High /

Extreme Risk

CoreValve Evolut™ R

Repositionable/Recapturable

TruFit™ design & extended skirt for

optimal sealing 23/26/29 mm launched in FY16

34 mm: EU H2 FY17 & US H1 FY18

CoreValve Evolut™ PRO

Maintains proven benefit of a self-

expanding, supra-annular platform

Introduces additional external skirt sealing

technology designed to reduce mild PVL

Launch: EU & US H1 FY18

MEANINGFUL ITERATIONS AND CLINICAL EVIDENCE

CSH: TRANSFORMATIVE INNOVATION


19/26

2016 Investor D

$-

$1.0

$2.0

$3.0

$4.0

2015 2016 2017 2018 2019 20

Intrepid™

Differentiated dual stent design to accommodate a dynamic mitralannulus

Sealing and fixation achieved through a cork-like effect producedby variable stiffness along the height of the outer stent

Delivery requires no rotational alignment, no hunt for leaflets, &accommodates tilt & lateral misalignment

One implant platform capability regardless of delivery approach:trans-apical or trans-septal

One valve size reduces development & manufacturing complexity

Pilot study currently enrolling patients in EU and ANZExpect to start enrollment in the US in Summer 2016

Continue to evaluate both internal and external options for TMVRepair space

CSH: TRANSFORMATIVE INNOVATIONTRANSCATHETER MITRAL VALVE REPLACEMENT

GLOBAL MIT

Surgical Market

($ Billions)

US MitraClip F

US NG TMV R

EU TMV Repla

EU NG TMV Repair Technologies

Coapt trial 2 year data

CSH: CORONARY & RENAL DENERVATION


20/26

2016 Investor D* Excludes Germany

CSH: CORONARY & RENAL DENERVATION

PORTFOLIO EXPADRUG ELUTING STENTS

GLOBAL EXPANSION

STENTEX JV in Russia

Sole supplier access for ACS PCI

Localized manufacturing

$>700M cumulative Medtronic revenue thru FY21

Timing: H2 FY17

Resolute Onyx™

Drug-Eluting Stent

Most deliverable DES

Enhanced radiopacity with CoreWire Technology

+3.5% share in WE since launch*

Slowed ASP erosion

Launch: US H1 FY18 & Japan H2 FY18

Fractional Flow Re Low profile FFR micro-catheter

Low cost capital component

Euphora™ Drug Coate Drug coated balloon for coronary ar

proven Euphora platform

InTRAkit™ & TRAc Radial access kit and closure band de

procedures

Dxterity™

Best-in-class diagnostic catheter fo

transfemoral PCI procedures

Launches: EU FY17 -

MEANINGFUL ITERATIONS AND GLOBAL EXPANSION

Potential Contributors to VBHC Episo



21/26

2016 Investor D

Symplicity SpyRenal Denervation Sy

1B people WW; Direct costs $500B W

SPRINT Trial highlights huge unmet

Enrolling SPYRAL HTN Global Clinica

ON-meds study

OFF-meds study

Results from these i

Pivotal trial to be designed based on

studies

Polymer-free DES

Absence of degrading polymer minimizes

inflammation Increased potential for short-term DAPT

Drug is contained on the inside of the stent;

eliminates coating durability concerns during

tracking

Maintains excellent acute performance of Resolute

Onyx

1-month OCT data from the RevElution Trialshowed an excellent early healing profile with an

average of nearly 90 percent full strut coverage

Launch: EU FY19


RENAL DENERVADRUG FILLED STENTS

APV: AORTIC


22/26

2016 Investor D

APV: AORTIC

COMPLEX TACOMPLEX AAA

THORACIC

Valiant® EvoTAA Stent Graft Sys

Enhanced applicability

Increased patient customization Lower profile

Launch: EU/US H2 FY18 & Japan FY19

Short neck indication for Endurant used with Aptus EndoAnchor

Minimize risk and maximize existing endograft indications

Addressing the ~30% of patients with necks shorter than current

indication Launch: EU H2 FY17 & US H1 FY18

Valiant

®

Mona LBranch Thoracic Sten

Designed to maintain perfusion of the L

device while excluding the aneurysm fro

Avoid the need for LSA bypass procedu

Launch: EU H2 FY18, US & Japan FY20

MEANINGFUL ITERATIONS TO EXPAND THE MARKET

Valiant Thoraco AAA

Modular, off-the-shelf system for treating deadly

thoracoabdominal aneurysm

Non-specific branches for easier cannulation and anatomical

customization

Continuous distal perfusion allows for procedure to be staged, ifnecessary

Launch: EU FY19

SHORT NECK

APV: PERIPHERAL – ENDOVENOUS


23/26

2016 Investor D

APV: PERIPHERAL ENDOVENOUS

endDRUG COATED BALLOONS

GLOBAL DCB MARKET ~$1B

-

0.4

0.8

1.2


OUS SFA

US SFA

WW BTK

WW AV Access

$ B i l l i o n s

Expanding into Venous Obstru DVT Treatmen

VClos

New Non-The

Reflux Proced Launched: US

HawkOne 7F / 6FTM

Next generation atherectomy systems; 7F - improvements in crossing profile,

calcium cutting and ease of use. 6F - improvements in calcium cutting

and ease of use. New multi-levelversion.

Launched: (7F) US H2 FY15

Launch: (6F) US H2 FY17

IN.PACT® Admiral

Highest patency and lowest TLR in any

SFA pivotal study

Launch: US 150mm H1FY17 Other Indications

In Stent Restenosis: US H1 FY17

AV Fistula: EU H2 FY16 (4-7mm) / EU H2FY17 (8-12mm)

BTK: EU FY19

NON-DCB

GLOBAL PERIPHERAL MARKET ~$4B+

(Includes DCB)

-

1.0

2.0

3.0

4.0

5.0


Peripheral

TRANSFORMATIVE INNOVATION AND MEANINGFUL ITERATIONS

GLOBAL ENDOV

-

0.5

1.0

1.5

2.0

FY16 FY17 FY1

$ B i l l i o n s

$ B i l l i o n s

THERAPY INNOVATIONS


24/26

2016 Investor D

O O SCONTINUED STRONG CADENCE OF MEANINGFUL GROWTH DRIVERS

CoreValve Evolut™ R XLEU H2 FY17 & US H1 FY18 T A V R

FY16

IN.PACT® Admiral®US: H1 FY17 Sizes & Indications D

C B

FY17

M R I

C R T - D

CompiaTM, AmpliaTM & ClariaTM WW: Launching

D F S Drug

EU: F

Resolute Onyx™US: H1 FY18 D

E S

M R I

P a c e r

3T MRITM

WW: Launching

M R I

I C D Visia AF MRITM

WW: Launching

W i r e l e s s

P a c e r

AzureTM

EU H2 FY17

Micra™EU & US: Launching

L e a d l e s s

P a c e m a k e r

Value Segme

PRO

3T Clar ia

150 mm AVF 8-12mmISR

LINKING PRODUCTS AND SERVICES / SOLUTIONS


25/26

2016 Investor D

MULTI-LINE CONTRCORE SERVICES AND SOLUTIONS

Risk Share(Adaptive

CRT /Shockless)

InfectionControl

(TYRX)

Dare to Care

RBC

Care MgmtSvcs

PRO | CV

ConnectedCare

CVGSolutions

SERVICE REVENUES

CVG Solutions – “Wrap

Around Programs”

CathLab Managed Services

Patient ManagementServices

(e.g. Care Management

Services)

Diagnostics Services

(e.g. LINQ/SEEQ)

-

0.2

0.4

0.6

0.8

1.0


Diag / CVG

Solutions

Patient Svcs

CathLab

$ B i l l i o n s

0%

5%

10%

15%

20%

25%

30%

35%

FY13 FY14

Increasing use of U.S. Multi-Line Con

preserve share and mitigate ASP dec

% o

f U

. S .

R e v e n u e G e n e r a t e d

b y M u l t - L i n e C o n t r a c t s

CARDIAC AND VASCULAR GROUP


26/26

2016 Investor D

GROWTH D

Therapy Innova

Transformative

Meaningful New

Iteration.(250-

Globalization w

150-200bps th

Market growth

Services and So

contribute 50-

Growth.

CONSISTENT MSD GROWTH

*Growth Rate @ Constant FX, 52wks and are inclu sive of Services & Solutions.

+6%CAGR*

FY16AFY11A FY21E

+5-6%

CAGR*

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Medtronic Cardiac and Vascular Investor Day Presentation

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