Medtronic Cutting Up to 500 Jobs Due to Faltering Defibrillator Sales

Medtronic announced Thursday that it planned to cut 350 to 500 jobs at the division that makes heart defibrillators. The Fridley-based medical device maker blamed a prolonged slump in sales of of the implantable devices, which can shock an erratically beating heart back into proper rhythm.

Employees in the medical device maker’s cardiac rhythm disease management division – which makes implantable cardioverter defibrillators, pacemakers and related products – were given the option of transferring to other areas of the company, early retirements or voluntary buyout packages, Medtronic spokesman Rob Clark said. The company will lay off employees if too few employees leave on their own.

“Our hope is that we can achieve most or all of this through the voluntary programs,” Clark said.

It wasn’t immediately clear how many of the job cuts would be in the Twin Cities.

The cardiac rhythm division, which reported revenue of $4.9 billion the past fiscal year, employs 13,500 people worldwide, including about 4,500 in the Twin Cities. The division is moving from Rice Creek to new headquarters in Mounds View later this year.

The defibrillator and pacemaker industry was hit with a series of safety related recalls in the past two years, most of which affected rival Guidant Corp. products, although market leader Medtronic recalled 87,000 defibrillators in February 2005.

The number of defibrillator implants declined in 2006 as a result. At Medtronic, annual sales of ICDs were $3 billion in the past fiscal year – flat compared with the prior year.

Clark said there are about 530 open positions in other Medtronic divisions in the U.S., some of which sell vascular and spinal devices and insulin pumps. Worldwide, the company will add 1,400 positions this year.

SOURCE: AP