Boulder's Covidien off to a bright new start

By Alicia Wallace, Daily Camera

Published August 19, 2008 at 9:05 p.m.

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Photo by Cliff Grassmick © Boulder Daily Camera

At Covidien in Boulder, A product operator works on new hardware in July 2007, the month Tyco International Inc. completed its health care spinoff, including two Boulder-based divisions.

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Early last year, when conglomerate Tyco International Inc. chose a name for its health care business spinoff, Tyco settled on "Covidien."

With "co" representing the Latin word for "together" and "vid" for the Latin root for "life," the name was to embody a new start for a familiar player within the health care industry.

And when the spinoff was completed in July 2007, so began a new life for the businesses under the Covidien umbrella, including two Boulder-based divisions: Energy-based Devices (formerly Valleylab) and Respiratory & Monitoring Solutions (formerly Nellcor Puritan Bennett, which relocated to Boulder in January 2007 from Pleasanton, Calif.).

Thirteen months later, officials for the local units - which, combined, make Covidien the fifth-largest employer in Boulder and Broomfield counties - tell stories of increased investment and work force growth that have led to the development of products designed to further the company's foothold in the market and improve people's lives.

Nellcor settles in

In early 2006, Tyco International Inc., which recently had emerged from an accounting fiasco involving former executives, announced plans to split into three separate, publicly traded companies - Tyco Healthcare, Tyco Electronics and the combination of its Fire and Security and Engineered Products and Services arms.

At that time, Tyco Healthcare, parent of Boulder-based electro-surgical products maker Valleylab, notched $9.5 billion in annual revenue. The Colorado born-and-bred Valleylab employed 1,100 people locally and was the area's eighth-largest employer.

Months before the July 2007 split, Boulder became home to another Tyco Healthcare division: Nellcor Puritan Bennett. The $1.4 billion medical device company decided to settle in Gunbarrel next to its colleague as a way to attract employees, save on costs and to have some synergy with Valleylab.

Nellcor's move was expected to bring with it 300 new jobs. The two divisions combined would equal $2 billion in sales, about one-fifth of the soon-to-be separate Tyco Healthcare, officials said.

After the split occurred and Covidien, which has its U.S. headquarters in Mansfield, Mass., started trading on the New York Stock Exchange, Bryan Hanson, president of the Energy-based Devices unit, was enthusiastic about investments that fueled the former Valleylab's research and development, global marketing and business development pieces.

"Clearly we're seeing the benefits of acting more like a medical device company," he said at the time.

Sitting in his office at 5920 Longbow Drive - an address Valleylab had called home for more than 30 years - Hanson's attitude is little changed.

If anything, he was even more positive.

"We have been more disciplined in terms of what we do focus on," he said.

A look at Covidien

* Formerly: Tyco Healthcare, which spun off from Tyco International in July 2007

* 2007 sales: $10.2 billion.

Worldwide employees: 42,000

* Local employees: 1,775 (at Energy-based Devices and Respiratory & Monitoring Solutions units)

* Key brands: Kendall; Autosuture; Syneture; Valleylab; Mallinckrodt; Nellcor; Puritan Bennett

* Notable products: Monoject Magellan Safety Needle; Valleylab RF Ablation System; Kangaroo ePump Enteral Feeding Pump; Optivantage DH Dual Head Injector; Syneture Wound Closure Device

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