Although he isn't anticipating having to lay off workers at this point, Medtronic CEO Bill Hawkins says his company will spend between $150 million and $200 million each year starting in 2013 as a result of device excise tax contained in healthcare reform bill.
Hawkins made this prediction in an interview with CNBC's Mike Huckman and Maria Bartiromo, during which he said the tax will cause companies--particularly smaller ones--to cut back on R&D spending. However, at this point, it is difficult to measure how large the impact will be.
During the interview, Hawkins showed off a transcatheter valve--an example of a minimally invasive product Medtronic would like to bring to the U.S. market. The valve doesn't require the physician to open a patient's chest. It is currently available outside the U.S., but Hawkins hopes to begin clinical trials with the product by the middle of the year.
Hawkins also talked the Boston Scientifc ICD recall. He said it was unfortunate that it would happen to any company, but Medtronic was there from day one to ensure that the recall wouldn't adverse affect patients.
Finally, Hawkins addressed the hacking of medical devices. A recent article in the New England Journal of Medicine warns that hackers might one day go after the medical devices designed to deliver medicine or help heart conditions. Hawkins said the issue had been raised a couple of years ago, and he isn't aware of any instances of hacking. However, Medtronic will be vigilant to work against such a threat.
- see the CNBC interview