Medtronic exit from ventilator business could lead to 40 Irish redundancies

In a market announcement accompanying financial results for its third quarter, the company said it had decided to stop manufacturing ventilators, a market it described as “increasingly unprofitable”.

In a statement to the Irish Independent, a spokeswoman for Irish-headquartered Medtronic said it has just entered a consultation phase with employees and had asked them to consider the option of moving to other Medtronic sites or taking a voluntary redundancy package. While the number of staff affected is not clear as yet, she said the company expected no more than 40 redundancies out of its 4,000 employees in Ireland across its five sites.

“The decision to wind down the ventilator business is not made lightly and there is a great deal of consideration for our employees and how they are affected,” she said. “While there may be impacts, we will work to redeploy employees currently in the ventilator business to roles in other parts of Medtronic where possible, or offer comprehensive transitional support.

“Our Mervue site in Galway, which currently manufactures ventilators, will continue to be an important facility for Medtronic. Since 2020, our product lines at the site have diversified and we will continue to look for new investment opportunities for this location.

“Ireland will remain a significant location for Medtronic well into the future,” the spokeswoman added. “We have a strong and long-standing presence here, celebrating 40 years in 2022. Ireland is our corporate headquarters, and a significant manufacturing and R&D hub.”

Medtronic also said it was committed to serving the needs of its current customers and patients and would honour its ventilator service contracts. It expects existing manufacturers, who account for the majority of the market, will be able to meet customer demand for ventilators in the future.

According to the statement, Medtronic has decided to retain the remaining Patient Monitoring and Respiratory Interventions businesses and combine them into one business unit called Acute Care and Monitoring. This new unit would focus on airway management and patient-monitoring technologies, helping clinicians reduce serious respiratory complications.

In March 2020, during the early days of the Covid-19 pandemic, Medtronic announced it was ramping up production of ventilators at its factory in Galway. At the time, Medtronic had over 250 employees dedicated to ventilator manufacturing and had said there were plans to more than double that number.

Exiting the ventilator market will be seen as a further illustration of Medtronic’s determination to focus on giving a return to investors. Last month Geoff Martha, its CEO, said the company was closing at least five manufacturing sites, consolidating distribution centres, and would no longer do business with about 200 suppliers.

Medtronic, which also has facilities in Athlone and Dublin, reported worldwide revenue of nearly $8.1bn, an increase of 4.7pc. The increased revenue reflected “strong growth” in areas of the business, including diabetes, cardiac and core spine, as well as strength in its international markets.

The New York Stock Exchange-listed company, which has a market valuation of over $114.6bn, has a global team of over 95,000 people across 150 countries. Medtronic’s technologies and therapies treat 70 health conditions and include cardiac devices, surgical robotics, insulin pumps, surgical tools and patient monitoring systems.