Mike Hess

Vice President, Innovation

Medtronic Inc

Medtronic Today

40,000 Medtronic Employees

120 countries

• World headquarters Minneapolis

• European headquarters Lausanne

• Asia/Pacific headquarters Singapore

• $40-60 Billion market capitalization

• Revenue ~$15 Billion in 2009

• R&D $1.5 billion in 2009

A History of Innovations

•1930s •1940s •1950s •1960s •1970s •1980s •1990s •2000

Foley

Catheter

Starr-

Edwards

Valve

Palmaz

Stent

Deep Brain

Stimulation

External

Pacemaker

Implantable

Pacemaker

Intraocular

Lens Percutaneous

Valves

Dental

Implants

Total Hip

PTCA

Total

Disc

Aortic

Endograft

ICD

Heart-

Lung

Bypass

“Iron

Lung”

Artificial

Kidney

FDA

created

FDA

oversight

over

devices

DRGs

created

Medicare

established

External Innovation - VC Investing

Selected Investments

• Ardian– Series B investment

– Catheter-based hypertension treatment

• Weigao– Largest China-based medical device company

– $200M+ investment & joint venture in spine/ortho

• Inspire– MDT spin-out; Kleiner Perkins / USVP led Series A

– Provide IP license in exchange for equity interest

• $300M / 50+ companies

– Typically pfd. stock investment with Board seat

– Investment size varies; on average ~ $5M investment

Innovation Through Internal Ventures

Alzheimer’s

Parkinson’s

Movement Disorders

Pain Management

Hypertension

Periodontal/OMF

Infectious Diseases

DISEASE STATES

Heart Failure HypertensionMetabolic Diseases

DISEASE STATES

Metabolic Disease

DISEASE STATESDrug Delivery

FY10: ~$80M

MonitoringHepatitis-C Drug

Delivery

Biologics for Periodontal

Disease

Hospital Glucose

Monitoring

Quality Engineer

IP Portfolio

Systems

Engineer

Scientist

Mfg. Engineer

Information

Research

Scientist

Program

Mgr.

Technician

Challenge

Owner

R&D

Engineer

Internal Collaboration

Across Geography, Businesses and Functions

Process

Eng.

Global Idea Sourcing Through InnoCentive

• Open Innovation - Accessing Expert Networks around the world

• Actual Map of activity – recent Medtronic Challenges

Leverage Existing Technology to

Enter New Markets

New Technology for

New Markets

Grow Market Share in

Existing Markets

Expand Currently Served Markets with New

Technology

Existing NewTechnologies

Ex

isti

ng

Ne

w

Mark

ets

/ P

atients

10-15% 10-15%

40-45% 30-35%

DBS - Depression

Allocate Resources Toward New Growth

Hospital CGM Active Leadless Pressure Sensor Dental Biologics

Protecta Next Gen ICD Resolute DES Transcatheter Valves Patch Pump

Thank You

INNOVATION U: a new approach on campus

Mark Crowell

Vice President, Business Development

The Scripps Research Institute

La Jolla, CA, and Jupiter, FL

“Innovation Ecosystems for the Creative Economy”

April 25-27, 2010

Personal background

• 23 years tech transfer director – 22 in Research

Triangle Park

• Portfolio has evolved to include new ventures,

corporate research, seed capital, research parks,

entrepreneurship, economic development,

innovation management

• Key national/international roles and partnerships

(AUTM, BIO, National Academies, AAAS, others)

Innovation U: just what does it mean?

• Moving from culture of invention to culture of

innovation (from tech push to market pull)

• Addressing risk, adding value, creating impact –

translating good ideas into enterprise

• Connecting across silos, disciplines, campuses,

regions – and worldwide

• Incessantly revolutionizing from within

(Schumpeter)

• Solving the problems of the world!

Innovation U in action (case studies)

• Proof of Concept Fund (Scripps) – partner with corporate VC groups to create fund for spanning “gap”

• UNC Center for Integrative Chemical Biology and Drug Discovery – de-risking leads, advancing to clinic, positioning for market

• Partnering with venture philanthropy groups and non-profits to advance promising technology opportunities

• Reaching across campus to leverage resources available to support innovation – supporting creation of network of innovation intermediaries

• Seed capital fund - $$ from endowment

• Reaching across campus, including arts/humanities, social causes, to “make innovation / entrepreneurship part of weave and fabric of university” (James Moeser)

Innovation U: critical issues

• Develop stable sources of funding for innovation and translational initiatives – Proof of Concept Centers, seed funds, entrepreneurship education, and related programs essential

• Develop more scholarship around innovation and entre-preneurship to identify/disseminate best practices and useful metrics

• Align campus policies and state/federal laws/regs with innovation agenda

• “Instead of following the money, we need to lead the money to find more effective ways to invest in innovation” (Greg Simon, former President, Faster Cures)

Josh Makower, MDFounder & CEO, ExploraMed, Inc.Consulting Associate Professor of Medicine, Stanford University – BiodesignVenture Partner, NEA

My background:

1.1 Strategic Focus

1.2 Observation &

Problem Identification

1.3 Need Statement

Development

2.1 Disease State Fundamentals

2.2 Treatment

Options

2.3 Stakeholder Analysis

2.4 Market

Analysis

2.5 Needs Filtering

4.6 Concept Selection

1. NEEDS FINDING

5. DEVELOPMENT STRATEGY

5.1IP Strategy

5.3 Regulatory

Strategy

5.5 Clinical & Marketing Strategy

5.4Stakeholder /

Political Strategy

5.2Reimbursement

Strategy

6. DEVELOPMENT PLAN

6.2 Clinical Trial

Design

6.1 R&D /Engineering

Plan

6.4Operating Plan

& Milestones

6.6Funding Sources

6.7 Business Plan Development

6.3 Sales &

Marketing Plan

6.5 Financial Modeling &

Proxy Validation

2. NEEDS SCREENING AND SPECIFICATIONID

EN

TIF

YIN

VE

NT

IMP

LE

ME

NT

3.1Brainstorming

4.1 Intellectual

Property

4.5 Early Stage Design &

Prototyping

4.2 Reimbursement

4.3 Regulatory

4.4 Business Models

3.2 Concept

Screening

4. CONCEPT SELECTION

5.6 Competitive Advantage &

Value Proposition

Need Statement

Need Specification

MultipleConcepts

FinalConcept

& Prototype

Competitive AdvantageStatement

BusinessPlan

3. CONCEPT GENERATION

Full year fellowships in biodesign innovation

Stanford based (8 Fellows)

India (8 Fellows)

Singapore (4 Fellows)

2 quarter master class biodesign innovation

Approx. 80 graduate students (med/bus/eng)

d-school partnerships: extreme affordability Innovators Workbench Series Faculty, Industry & Community Ed Programs

Biodesign Year

OUS, US

Clinical Status Business Status

Acquired1

2

1

1

4

6

4

7

7

7

OUS, US

OUS, US

OUS, US

OUS

OUS, US

OUS

Pre-Trial

OUS

OUS

Acquired

Acquired

Acquired

Series B

Series B

Series B

SBIR Ph. 1

Series A

Series A

Fellow and student companies….

4/29/2010 21

ExploraMed is a medical device incubator dedicated to significantly improving patients quality of life through paradigm shifting cost effective device solutions.

4/29/2010 22

1995 ExploraMed I ($850K) 1996 EndoMatrix

1996 TransVascular, Inc.

2004 ExploraMed II ($4M) 2004 Acclarent, Inc.

2005 NeoTract, Inc.

2006 ExploraMed III ($7M) 2006 Vibrynt, Inc.

2007 Moximed Inc.

4/29/2010 23

1995 ExploraMed I ($850K) 1996 EndoMatrix ACQ. C.R. BARD $14MM 1997

1996 TransVascular, Inc. ACQ. MDT $90MM 2003

2004 ExploraMed II ($4M) 2004 Acclarent, Inc. ACQ. JNJ $785MM 2010

2005 NeoTract, Inc.

2006 ExploraMed III ($7M) 2006 Vibrynt, Inc.

2007 Moximed Inc.