St. Jude Medical to Reorganize and Restructure Management

St. Jude Medical Inc. is shaking things up again with an internal reorganization and executive changes.

The St. Paul, Minn.-based cardiovascular giant plans to integrate its two operating divisions into one integrated research and development organization, and will combine manufacturing and supply chain operations worldwide. The moved come on the heels of a successful year for the company. The company saw its stock price rise more than 70 percent.

“One reason 2013 was such a successful year for us was that we streamlined our organization, improved productivity, and reduced costs through organizational changes we announced in August 2012,” said President and CEO Daniel J. Starks. “The changes we announced today will help us build on that success to further leverage our scale, align on our highest priorities and improve execution of our long-term growth program.”

To help the company navigate through these significant operational changes, Michael Rousseau, previously group president of St. Jude Medical, has been promoted to chief operating officer. Rousseau will now oversee sales, marketing, quality, technology development, operations and supply chain on a global basis. Eric Fain, previously president, Implantable Electronic Systems Division (IESD), has been promoted to group president of St. Jude Medical and will now oversee all clinical, regulatory and research and development activities across the company. Over the next several months, Fain will lead the integration of IESD and the Cardiovascular and Ablation Technologies Division (CATD) into one cohesive St. Jude Medical research and development organization.

In addition, the company announced three new officers. Scott Thome is being promoted to the newly created position of vice president, global operations and supply chain; Lisa Andrade has been promoted to chief marketing officer; and Jeff Dallager has been promoted to vice president, corporate controller.

St. Jude Medical also announced today that Frank Callaghan, previously president, CATD, will retire. Callaghan has been an integral part of the St. Jude Medical leadership team since joining St. Jude Medical in 2005 as part of the Endocardial Solutions acquisition.

He will remain an advisor to the company through 2014.

“Frank has led the implementation of numerous technology programs within our business and has been instrumental in driving our growth and reputation as an industry leader in the cardiovascular market. St. Jude Medical sincerely thanks him for his strong leadership and wishes him a wonderful transition into retirement,” said Starks.

At the J.P. Morgan Healthcare conference held earlier this month in San Francisco, Calif., Starks told an audience he plans for the company to forge ahead with its effort to enter the U.S. market for renal denervation devices–despite Medtronic Inc.’s high-profile trial failure recently. In addition, Covidien and Boston Scientific also have put the breaks on their renal denervation programs.

For 2013, St. Jude reported profits up 8 percent for the full year, on sales growth of 4 percent to $1.4 billion. It was a tough year for St. Jude’s largest unit, cardiac rhythm management, with questions about the safety of its Durata ICD leads. But the markets started to rebound toward the end of the year. They grew 3 percent in the fourth quarter, despite a 2 percent drop overall for 2013.