SEC Filings

10-Q
MEDTRONIC PLC filed this Form 10-Q on 12/04/2017
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business. The addition expanded and strengthened the surgical offerings and complemented our global gynecology business.
Restorative Therapies Group
The Restorative Therapies Group's products focus on various areas of the spine, bone graft substitutes, biologic products, trauma, implantable neurostimulation therapies and drug delivery systems for the treatment of chronic pain, movement disorders, obsessive-compulsive disorder (OCD), overactive bladder, urinary retention, fecal incontinence and gastroparesis, as well as products to treat conditions of the ear, nose, and throat, and systems that incorporate advanced energy surgical instruments. The Restorative Therapies Group also manufactures and sells image-guided surgery and intra-operative imaging systems and therapies to treat diseases of the vasculature in and around the brain, including coils, neurovascular stents and flow diversion products. The Restorative Therapies Group’s net sales for the three and six months ended October 27, 2017 were $1.9 billion and $3.7 billion, respectively, an increase of 2 percent as compared to the corresponding periods in the prior fiscal year. Currency had a favorable impact on net sales for the three months ended October 27, 2017 of $4 million and an unfavorable impact on net sales for the six months ended October 27, 2017 of $3 million. Net sales growth for the three and six months ended October 27, 2017 was driven by growth in Brain Therapies, partially offset by declines in Pain Therapies and the negative impact to net sales from Hurricane Maria. See the more detailed discussion of each division’s performance below.
Spine net sales for the three and six months ended October 27, 2017 were $659 million and $1.3 billion, respectively, a decrease of 1 percent and flat, respectively, as compared to the corresponding periods in the prior fiscal year. Spine net sales growth was impacted by declines in Core Spine, partially offset by net sales growth in BMP (composed of INFUSE bone graft (InductOs in the European Union)) due to favorable product mix. Core Spine net sales declined due to overall market softness in the U.S. and Europe and the negative net sales impact from Hurricane Maria, partially offset by the continued success of our Surgical Synergy strategy, which integrates our spinal implants with enabling technologies such as imaging, navigation, power instruments, nerve monitoring and Mazor robotics sold by our Neurosurgery business, and our "Speed-to-Scale" initiative, which involves faster innovation cycles and the launching of a steady cadence of new products at scale with sets immediately available for the entire market.
Brain Therapies net sales for the three and six months ended October 27, 2017 were $575 million and $1.1 billion, respectively, an increase of 14 percent and 10 percent, respectively, as compared to the corresponding periods in the prior fiscal year. Brain Therapies net sales growth was driven by strong growth in both Neurovascular and Neursurgery. Neurovascular net sales growth was driven by strong sales of our Solitaire family of revascularization devices for acute ischemic stroke. Neurosurgery net sales growth was driven by strong sales of the StealthStation S8 surgical navigation system and Midas disposables, as well as placement of capital equipment through our distributor agreement with Mazor. Net sales growth in Neurovascular and Neurosurgery was partially offset by declines in Brain Modulation due to competitive pressures in the U.S. and Europe.
Specialty Therapies net sales for the three and six months ended October 27, 2017 were $365 million and $734 million, respectively, a decrease of 1 percent and an increase of 1 percent, respectively, as compared to the corresponding periods in the prior fiscal year. Specialty Therapies net sales was driven by growth in ENT and Transformative Solutions for the three and six months ended October 27, 2017, offset by declines in Pelvic Health. ENT net sales growth was driven by strong growth in disposables, and Transformative Solutions net sales growth was driven by the Aquamantys Transcollation and PEAK PlasmaBlade technologies. InterStim supply issues related to Hurricane Maria negatively impacted Pelvic Health net sales growth for the three and six months ended October 27, 2017.
Pain Therapies net sales for the three and six months ended October 27, 2017 were $264 million and $533 million, respectively, a decrease of 8 percent and 6 percent, respectively, as compared to the corresponding periods in the prior fiscal year. The decrease in net sales was driven primarily by decreases in our Spinal Cord Stimulation products due to competitive pressures in the U.S. and Europe, as we await full launch of our Intellis platform, as well as the negative net sales impact related to Hurricane Maria, partially offset by growth in Interventional from the OsteoCool RF Spinal Tumor ablation system and strong sales in Japan and China.
Looking ahead, we expect our Restorative Therapies Group could be affected by the following:
Changes in procedural volumes, competitive product launches and pricing pressure, geographic macro-economic risks, reimbursement challenges, impacts from changes in the mix of our product offerings, the timing of product registration approvals, and fluctuations in currency exchange rates.
Continued acceptance and growth of the Solitare FR revascularization device for treatment of acute ischemic stroke and the Pipeline Embolization Devices, endovascular treatments for large or giant wide-necked brain aneurysms.

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