Covidien

History

2019: A fine of $20 million for rollbacks to doctors at sale of catheters

In the middle of March, 2019 Medtronic agreed to pay nearly $20 million for settlement of the charges of rollback connected with sale and promotion of catheters for radio-frequency ablation of ClosureFast which are developed by Covidien subsidiary company.

In addition to a penalty in the amount of $17.5 million, the company should pay $1.5 million to the State of California and $1 million to the State of Florida where Covidien unrolled the primary illegal activity. The U.S. Department of Justice reported that Covidien provided to doctors services in business development in exchange for acquisition of catheters for ablation of ClosureFast which were paid for programs of health insurance Medicare and State Medicaid. Covidien made individual marketing plans, held meetings and dinners and also provided to doctors other free services for promotion of the ClosureFast device.

Medtronic will pay $20 million for rollbacks to doctors at sale of catheters for radio-frequency ablation

Covidien provided medical services at a discount or free of charge and therefore hoped to avoid charges of bribery of officials. The Assistant Attorney General of the U.S. Department of Justice Jody Hunt in the statement for this trial reminded medical community that illegal rollbacks happen different forms and are not limited to money payments to suppliers. Providing free or preferential services to health workers for promotion of certain devices or services can lead to adverse effects. Schemes of "rollback", representatives of the law remind, harm not only to patients – they undermine confidence of the public to a health care system.

Since December, 2018 on the middle of March of the 2019th Medtronic agreed to pay in total $50.9 million within settlement of charges of illegal promotion of products of the subsidiary companies ev3 and Covidien, including $17.9 million in case of inappropriate marketing of ev3 company.^[1]

2015: Medtronic announces completion of acquisition of Covidien

The Medtronic plc company, the supplier of medical technologies, services and solutions, announced in January, 2015 a successful completion of acquisition of Covidien. In accordance with the terms agreements on acquisition, Medtronic, Inc. and are integrated by Covidien plc in Medtronic plc company. It is expected that the shares Medtronic plc will begin to be traded at the New York Stock Exchange (NYSE) under a ticker of MDT on January 27, 2015.

On January 26 after closing of trading day biddings on stocks of Covidien and Medtronic, Inc. at the New York trade exchange were stopped. The cost of the transaction paid with money and actions is estimated approximately at 49.9 billion US dollars proceeding from the fact that as of the moment of closing of trading day on January 26, 2015 the security quotations of Medtronic made 75.59 US dollars for an action. In accordance with the terms transactions each ordinary share of Covidien which is in circulation at the time of the above-stated closing is converted into the right to 35.19 US dollars by money and 0.956 ordinary shares Medtronic plc. Each ordinary share of Medtronic, Inc. which is in circulation at the time of the above-stated closing is converted into the right to one ordinary share Medtronic plc.

The financial adviser of Medtronic – Perella Weinberg Partners LP company, legal advisers of Medtronic: Cleary Gottlieb Steen, Hamilton LLP and A&L Goodbody. The financial adviser of Covidien - Goldman Sachs company, legal advisers of Covidien: Cleary Gottlieb Steen, Hamilton LLP and A&L Goodbody.

Completion of the transaction will not affect results of activity of Medtronic, Inc. according to the results of the third quarter which ended last Friday, January 23, 2015. The company is going to provide the specified financial performance for the third quarter during a teleconference which will take place on Tuesday February 17, 2015. More detailed information on expected changes in profit and financial performance of Medtronic plc can be found here - Medtronic plc Revenue Reporting Changes and Historical Financials.