Medtronic to split diabetes business into separate entity, targets IPO

Ross Law

Thu, May 22, 2025, 5:05 AM 3 min read

Medtronic has announced plans to separate out its diabetes business into a new standalone company.

The separation will serve to create an “independent, scaled leader in diabetes” that boasts an ecosystem of insulin management devices including pumps and continuous glucose monitors, Medtronic said.

The split will also in turn create a wholly “more focused” Medtronic, with a more simplified portfolio in high margin growth markets.

Medtronic's shares on the New York Stock Exchange (NYSE) fell by 2.27% at market close following the announcement on 21 May.

“It’s going to give Medtronic some significant capital to increase their presence in other, more interventional, areas, especially in cardiovascular. They have a history of inorganic expansion, so I can see this as providing ammunition for a big acquisition in 2026-7,” said Dr Andrew Thompson, director of therapy research and analysis in medical devices for GlobalData reacting to the separation.

With a preferred path of an initial public offering (IPO) and subsequent split-off, Medtronic anticipates the split to complete within 18 months through a series of capital markets transactions.

Medtronic describes the vision for the new diabetes standalone as being a “scaled, direct-to-consumer” business that is positioned positioned as “the only company to commercialise a complete intensive insulin management ecosystem”.

In addition, Medtronic anticipates that the separation will enable more focused investment into the new diabetes business’s pipeline and manufacturing scale and automation, thereby positioning it for success in Automated Insulin Delivery and Smart MDI as it drives margin expansion over time.

“As for the spin out, it might not remain a spin out for that long. Medtronic recently gained US Food and Drug Administration (FDA) 510k approval on a new CGM sensor that is interoperable with Abbott devices, and both companies have an agreement. Abbott might be wishing to preserve that relationship. I wonder if the standalone company might be something that is a joint venture between the two,” Thompson commented.

Medtronic’s diabetes business represented 8% of its total revenues in FY 2025 at around $2.75bn, denoting a 10.7% year over year rise. However, the business unit’s performance has recently been hampered by the FDA Class I recall of its MiniMed insulin pump system in 2024, resulting in a dent to consumer confidence amid tightening competition and mounting operational losses for the unit since 2022.

According to a GlobalData market model, in 2024, Medtronic held respective US market share of around 6% and 7.3% in the insulin delivery and glucose monitoring segments.