Medtronic plc Wells Fargo 21st Annual Healthcare Conference

Well, first of all, Larry, congratulations on that conference. It is great to see it continuing to grow, and thanks for having us. Look, I think it is a great time to invest in MedTech, because we see some really great innovation happening, not just in the traditional biomedical engineering side, less invasive devices, smaller devices, longer batteries, et cetera, but when you take the AI and robotics, they are like force multipliers. And they have allowed us to expand our scope of innovation from not just improving patient outcomes, but to lowering costs over time and also expanding access. I think it is a great time to invest in MedTech right now. We can go through this. When you look at our growth and the growth acceleration at Medtronic, some of it is market share, but a lot of it is expanding the markets and pulling new patients in.

In some cases, it is brand new segments like renal denervation for hypertension. But in other cases, it is just like lowering the threshold for 75-year-old businesses like cardiac rhythm management, and expanding those markets and pulling more patients in above and beyond any kind of impact from chronic disease, rising chronic disease or aging population. When you even factor that out, we are still pulling a lot more patients into new therapies.

Well, the policy change I hear the most about would be like the ACA rollbacks. Look, we've looked at that. A couple things, because we've seen some of that commentary. First of all, our procedural mix is very acute, right? That's one piece of it. We're not into these more elective procedures. We don't have as much exposure to that. When it comes to ACA, linked to that acute nature, maybe two thirds of our payer mix is Medicare, 25% commercial, and less than 10% Medicaid. When you look at our exposure to ACA related programs, it's less than 1% of our revenue globally. So it's just not a lot of exposure to it.

Well, look, I'll start on the revenue side. It's definitely having an impact on our revenue. Again, when we talk about AI, and like I said, especially when you combine it with robotics, but even by itself, it's a force multiplier. When we talk about AI in our products, we're largely talking about, look, we have a lot of access to structured physiological data, structured device data, procedure data. We're not talking about large language models and just general data. We're talking about very precise data, and we're using that more in a machine learning environment, and it's dramatically impacting our ability to diagnose things earlier, better. Here's the big one. To personalize therapy at scale. So whether it's personalizing your DBS therapy, personalizing a surgical plan in spine for one patient, you're able to do that at scale, and that's going to help with clinical outcomes.

As I said just a second ago, it's helping us expand our aperture on what the benefits of the innovation to talk about access. I just saw this example the other day, our GI Genius for colonoscopy, that's AI in the colonoscopy procedure. In the U.S., it's quickly becoming the standard of care, because we found in our clinical trials that anywhere from 25%-50% of the polyps are missed in the leading centers in the U.S. This has erased that, right? It's fixed that with the GI Genius that we have. Go over to a place like India, I saw a massive hospital with hundreds of people in the waiting room getting colonoscopies.

Yet here, what we saw is very young physicians, and the CEO of the hospital said, "Look, these physicians are right out of med school, don't have the apprenticeships or the fellowships that you have in the U.S., but they're getting the exact same diagnostic yield as you're getting in the U.S. because of GI Genius." It democratizes good care.