Good morning. My name is Vanessa and I will be your conference operator today. At this time I would like to welcome everyone to the Medtronic First Quarter Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions). Thank you. I would now like to turn the call over to Mr. Jeff Warren. Please go ahead sir.

Thank you, Vanessa. Good morning and welcome to Medtronic's first quarter conference call and webcast. During the next hour, Omar Ishrak, Medtronic Chairman and Chief Executive Officer, and Gary Ellis, Medtronic Chief Financial Officer, will provide comments on the results of our fiscal year 2015 first quarter which ended July 25, 2014. After our prepared remarks, we will be happy to take your questions. First, a few logistical comments. Earlier this morning, we issued a press release containing our financial statements and our revenue by business summary. You should also note that some of the statements made during this call may be considered forward-looking statements and that actual results might differ materially from those projected in any forward-looking statement. Additional information concerning factors that could cause actual results to differ is contained in our periodic reports filed with the SEC. Therefore, we do not undertake to update any forward-looking statement. In addition, the reconciliations of any non-GAAP financial measures are available on the Investors portion of our website at medtronic.com. Also, unless we say otherwise, references to quarterly results increasing or decreasing are in comparison to the first quarter of fiscal year 2014 and all year-over-year revenue growth rates are given on a constant currency basis. And finally, today’s earnings call does not constitute an offer to sell or the solicitation of an offer to buy any securities or solicitation of any vote or approval. In connection with the proposed Covidien transaction, Medtronic Holdings Limited has filed with the SEC a registration statement on Form S-4 that includes a preliminary joint proxy statement of Medtronic Inc. and Covidien plc that also constitutes our preliminary perspectives of new Medtronic. The registration statement is not complete and will be further amended. After the registration statement has been declared effective by the SEC, the final joint proxy statement perspectives will be mailed to Medtronic shareholders and Covidien shareholders. You should review materials filed with the SEC carefully as they will include important information about regarding post transaction including information about Medtronic and Covidien, the respective directors, executive officers and certain other members of management and employees who may be deemed to be participants in the solicitation of proxy in favor of the proposed transaction. Please also review the disclaimer page at globalmedtechleader.com for additional information on forward-looking statements and other important information on the proposed transaction. With that, I am now pleased to turn the call over to Medtronic Chairman and Chief Executive Officer, Omar Ishrak.

Good morning and thank you, Jeff, and thank you to everyone for joining us today. This morning we reported first quarter revenue of $4.3 billion, which represents growth of 4% and Q1 non-GAAP diluted earnings per share of $0.93, growing 6%. Our Q1 revenue growth is in the middle of our outlook range for the year and within our mid-single-digit baseline goal. Our overall organization again delivered balanced growth with strong performances in some areas offsetting challenges in other parts of our business. Significant this quarter was our performance in the U.S. where we grew 6%, the highest growth in this region for five years. We believe mid-single-digit growth in the U.S. can be sustained over the coming quarters based on the momentum of our new products. Therapy innovation contributed over half of our global growth this quarter. When combined with our focus on globalization and economic value, further enhanced by our pending acquisition of Covidien, we are well positioned to further improve our competitive position and long-term growth profile. As we have done previously, we intend to quantify, communicate, and execute in each of our independent growth vectors. Our new therapies growth vector contributed 200 basis points to our overall growth in Q1, which was well within our previously stated expectations of 150 basis points to 350 basis points. As I mentioned earlier, execution on several key new product launches helped drive growth this quarter. And looking ahead, we believe our robust pipeline will contribute significantly to our future growth. Starting with the cardiac and vascular group, our Reveal LINQ miniaturized cardiac diagnostic monitor along with strong above-market performance in AF Solutions are driving clear growth acceleration. This helps propel our cardiac rhythm and heart failure business to 4% growth, a level of performance that we have generally not…

Thanks, Omar. First quarter revenue of $4.273 billion increased 5% as reported or 4% on a constant currency basis after adjusting for a $34 million favorable impact of foreign currency. Q1 revenue results by region were as follows; Growth in the Middle East and Africa was 30%; Latin American grew 14%; Growth in U.S. was 6%; Greater China grew 6%; Growth in Central and Eastern Europe was 5%; Other Asia Pacific group 4%; with Western Europe and Canada region declining 2%; Japan declined 5% and South Asia declined 7%. Emerging markets grew a combined 11% in Q1 and represented 13% of our total sales mix. It is worth noting that results in Western Europe were negatively affected by our difficult comparison in Germany where customers made advanced purchases of CoreValve product in Q1 last fiscal year in anticipation of the since resolved CoreValve injunction. Japan’s performance was also affected by difficult comparisons from strong product launches in the prior year as well as the biennial R zone adjustments. Q1 diluted earnings per share on a non-GAAP basis were $0.93, an increase of 6%. Q1 GAAP diluted earnings per share were $0.87, a decrease of 6%, driven primarily by the favorable change in fair value of contingent consideration payments in the prior year. This quarter’s GAAP to non-GAAP pretax adjustments included a $30 million net restructuring charge, the final charge related to the initiative we announced last quarter and a $41 million charge for acquisition related items primarily associated with transaction cost in connection with the pending Covidien acquisition. It is worth noting that on a cash basis, Q1 diluted earnings per share were $0.99, an increase of 5%. In our cardiac and vascular group, revenue of $2.254 billion grew 3%, results were driven by growth in low power, structural heart,…

Thanks, Gary. And before opening the lines for Q&A let me briefly conclude by stating that Q1 was another successful balanced quarter. We continue to strive to reliably deliver on our baseline expectations. As we presented at our Investor Conference in June, we expect our continued efforts to deliver consistent and reliable performance combined with disciplined capital allocation, will enable is to create long-term dependable value in healthcare. And looking ahead, we believe this will be further strengthened and diversified by our Covidien acquisition. With that we will now open the phone lines for Q&A. In addition to Gary, I will ask Mike Coyle, President of our Cardiac & Vascular Group, Chris O'Connell, President of our Restorative Therapies Group and Hooman Hakami, President of our Diabetes Group to join us. We are really able to get to everyone’s questions, so please limit yourself to only one question and if needed one related follow-up. If you have additional questions, please contact our Investor Relations team after the call. Operator first question please.

(Operator Instructions). Your first question comes from the line of Mike Weinstein of JPMorgan.

Good morning. Thanks for taking the questions. Maybe, I can get a couple in just on the product front. First is the 40% plus share comment in transcatheter valves, I'm sure caught people's attention? Can you just talk about how that progressed over the quarter. I ask because obviously you were dealing with the potential injunction overhang in the first part of the quarter and you resolved that with the settlement with Edwards in late May. Can you just talk about that commentary? Was that 40% plus comment true for the whole quarter or was that particularly true in the back half of the quarter? And then the second product was hoping to get an update on was the IN. PACT Admiral drug-coated balloon. I believe you submitted the data in the final module at the end of May. Do you have any update from the FDA on whether you will need to go to an advisory panel? Thanks.

Mike can you take both of these?

So, the transcatheter valve side, of course that comment about 40% market share is a U.S. statement, that’s we basically have been proceeding with the launch as we’ve described it, actually a little bit ahead of schedule in terms of the total number of accounts that have been opened and the training of those accounts, and we actually are getting a little higher share in the accounts we’ve activated than we were expecting when we were talking at the analyst meeting. So we think our overall market share position’s in the low 40s depending on how you want to treat the royalty income, which our competitor treats as revenue we tend to exclude it for purposes of that calculation on overall market share. On the IN.PACT Admiral that we have heard from FDA in terms of the fileability of our PMA. They have accepted it for filing with no major deficiencies. They have told us they are going to treat this as an expedited review. They have not yet given us the definitive answer on whether a panel is going to be required or not.

Perfect. Let me ask one follow-up. Can you just comment on the regulatory path for the Covidien transaction, how things are progressing with China, the US, and the other geographies of note. Thanks.

Things are progressing, Mike, as we have thought. I think the schedule for the end of the calendar year in early -- or early calendar ’15 is what we expected when we started the process, and it still holds. The China approval is a little slower, it takes a little longer and often times after the process starts after we’ve made some progress in the U.S. and Europe. Things are going along just as we had expected. There are no major surprises, and I think we still expect this to close as I said towards the end of the year or early next year.

Your next question comes from the line of Matthew Dodds from Citi.

Good morning. If we look at the expense side on gross margin SG&A, you came in a little lower than we thought on gross margin and higher on SG&A. The full year guidance is really unchanged. You've got a big improvement, it looks like in the back half of the year. I guess for you, Gary, for the gross margin, are a lot of these issues going to linger or are some temporary other than FX? And then on SG&A, how much of the CoreValve launch and this incentive pay was front-end loaded, meaning that it won't -- it was really focused on the first quarter and it will drop?

Gary.

I can take both of those Matt. I mean as far as the gross margin goes, we do expect the gross margin will improve as we go through the year. As we indicated, it was a little lower here in the first quarter due to some things that we have known about, which are the quality costs in Neuro and diabetes. We also ended up having just with the mix, the product mix having a little bit lower ICD revenue in this quarter before the new product has been launched, and with LINQ, which is a little bit lower margin product that had a mix issue into Q1, but as we go forward and ICDs pick up again, we should be back up in the 74.5% to 75% range as we indicated. We also expect the issues to be addressed on the quality side within neuro and diabetes as we go through the year that will also start to come down. And as you indicated, FX, we obviously assume will start to become a minimized issue as we go through the rest of the year. So 74.5% to 75%, Q2 improving but it’d still be kind of at the lower end of that range, and continuing to improve as we go through the year. SG&A was a little more here in Q1, we kind of had expected that, we knew we are launching a lot of these new products with LINQ, CoreValve, and we just knew we’re going to have some higher expectations around expenses on those items. But it was in line with basically our expectations and as we go through the rest of the year, both investments obviously will start to leverage as we go through, as the revenues continues to build in both of those product lines, and so we’re expecting that the guidance we gave for SG&A and total that still remains on track and we are not concerned about at this point.

Just a quick follow up to Mike.

Yes, go ahead.

So Mike, now that the litigation's over, can you say on CoreValve are you still capacity constrained or is that not an issue, because it was a good quarter out of the chute in the US. Mike Boyle Well, we have been staying ahead of the demand, it’s been challenging for our operations in the group to stay ahead of the demand, but they have been doing that and we have not done any bulking of product or advanced purchase of product. So we are essentially selling as we implant, and we expected that will continue here during the next quarter.

Your next question comes from the line of David Lewis from Morgan Stanley.

Good morning. Maybe just one for Omar, maybe a quick follow-up. Omar, I appreciate your comments on the deal and the commitment relative to Covidien. I wonder if you can comment at all on, this transaction under various different transaction structures whether there may be remedies proposed by treasury or congress or pursuing this deal without an inversion structure. You talked a little about that on the day of the deal announcement. I wonder if you could update us on your views about the commitment to this transaction under different scenarios.

Yes. Well, as I’ve mentioned repeatedly and consistently, the strategic benefits of these transaction are very clear which I laid out today and earlier. We are excited about that. We feel, as we go through our integration planning process, we feel even more confident and excited about the strategic benefits of this combined company. So that’s the driver for the whole thing. We can only plan a deal structure based on facts and what the current regulations and law are. And so that’s why we structured it the way we structured it. Those things change before the close then we’ll have to take a look at what those changes reflect and see what we can do to structure a new contract and so forth. But in all cases the strategic benefits do not go away and are clearly not affected by any legislative or regulatory changes. So that’s the way we’re looking at it. it’s pointless to speculate in what those new changes could be to give priority of things if any. So, we prefer to stay away from that and stay focused on getting the regulatory actions taken care of as quickly as possible and then get this transaction closed, and structuring the strategic benefits.

Great, very helpful. And then one other important element of the strategy obviously is emerging markets and I know you talked about it in your prepared remarks, but maybe just help us understand two things. It sounds like there are underlying distribution changes in both India and China. Maybe help us understand why you're undertaking those distribution challenges. Is it really for greater long term revenue growth? Was it to respond to recent revenue depression? That would be very helpful. Do you think this quarter or sometime in the next two quarters we could see a trough in the growth rate in either India or China? Thank you.

Yes, thanks David. First of all distribution changes as you correctly point out, we’re making are long term in nature. Look, we view emerging markets like I’ve said before, as a key growth driver, not just for the next few years but for decades. Literally decades, because that’s the nature of the opportunity, we’re only addressing the premium segment when we get to value segment, the underserved; this is going to go on for a very long term. And as a result if you really talk of the long term the revenues from these regions will be big and certainly it probably will get from developed markets and we cannot have in that kind of a scenario go through indirect channels of -- we do not have direct control as with respect not only to business conduct standards but also and more importantly with respect to direct connection with our customers because we have to develop these markets. So, these are changes that we have to undertake. In addition, some of the management changes reflect upgrading some of the people because the nature of the business is more sophisticated than it once was. So these really are platform changes that we’re making they’re necessitated by our long term aspirations. And we feel we can cover it within our present business profile. And so we’re going ahead and making these changes which we feel will have a positive impact not only in our relationships and long term growth but also on our margin in these regions which already is good but can improve further. So that’s essentially the outlook in the strategic thought process behind emerging markets. In term of our trough, we are projecting both India and China to be double digit growth. The China, certainly in the mid-teens and India maybe even close to that by the end of the year, in other words for the full year. And so that will require an acceleration in the second half I think it will be different between the India and China. I mean there is still some variables in this, so I can’t be certain but that certainly our projection as of today that going into the second half of the year we’ll start to see a noticeable acceleration of growth in both of those regions.

And our next question comes from the line of Kristen Stewart from Deutsche Bank.

Omar was wondering if you could just maybe comment a little bit about some of the revised numbers that Covidien put out within your proxy, just in terms of the outlook. What gives you I guess the confidence in the longer term growth profile there and what if anything have you learned or makes you more confident in the revenue trajectory or perhaps even the cost synergies with some of the early integration or early I guess work under your belt, the transaction?

Well, I’ve been visiting many of the sites and understanding the products. And number of early observations that I have. First of all, Covidien has a track record and it builds a track record of revenue growth in the mid-single digits. And they have a diversified enough revenue pool, both geographically as well as from a product and customer basis. That appears to me that it’s quite sustainable and fairly tolerant of one-off market dynamics in there whether it’d be product or geography. So that is reassuring, I mean we knew that going in but deeper dive confirmed that. Equally importantly, as we go through the different sites, the future growth platforms if we can build by accelerating some of the technical, technology integration or channel integrations, there appear to be a lot of possibility. I think our biggest challenge will be to focus and make sure you prioritize the ones which will have the right returns and not go after ones that are potentially big but have perhaps returns which are more risky or even longer term. So, I think the prioritization exercise will be our biggest challenge. We have already stated that the two areas which will be the highest priority are in peripheral, vascular and in neuroscience and those are like many integration teams progressing and going ahead in those areas. The others will be longer term and surgical technologies and their surgical solutions is clearly opportunity both in terms of product integration for common co-points as well as technical and technology integration in future products. In addition, some of the capital equipment products and their monitoring products have longer term synergy in fact both our hospital solutions teams as well as our home monitoring business in Cardiocom. I think that’s about all I can say Kristen at this point.

Okay. And then just on the cost synergy side, do you still feel confident that that at least 850 number is the right number?

Yes, I doesn’t think there was any sort of doubt around that. I think all the work that we are doing is confirming that that’s an achievable number.

Your next question comes from the line of Bob Hopkins from Bank of America.

Great. Good morning. So I wanted to ask two quick questions. First, on the CRM market outlook, excluding LINQ which obviously is going very well, it looks like the CRM market is just a little bit worse than we thought this quarter. I was wondering if you could talk a little about the market dynamics in CRM. Is pricing a little bit worse than you thought? What at this point is your outlook for CRM market growth as you look forward?

I think the overall low power market actually looks quite encouraging, I think we have seen stabilization of the market demand and although we are seeing obviously some renewed pricing pressure, I mean we are now looking at sort of 3% to 5% declines in ASPs in the U.S. and both pacing at ICDs currently and that’s because we basically have anniversaried the major launches that we had. However, obviously we are about to enter a new launch cycle with high power side with CRT-D and we think that’s going to help us in terms of improving the overall pricing dynamics. In terms of the overall unit market growth, we are seeing essentially flattish unit growth in the ICD market with low single-digit increases in initial implants are being offset by declines in the replacement cycle, mostly because of where we are in our replacement cycle. So, we believe the market going forward is flattish and that’s what we are planning for otherwise encouraging from my perspective to see overall U.S. implantables growth for us at 4%. I mean we haven’t seen that in quite some time and so obviously it’s a good time to have a product like LINQ being added into the overall mix for implantables.

All right, that's helpful. And then Omar just wanted to ask one question for you as a follow-up on the emerging market commentary that you made thus far. Specifically on China I was wondering if you could just provide just a little more detail on the specific changes that you're making in China currently so we can get a better understanding of the outlook of China long-term and understand why those changes are being made.

I think this is harmonizing our distribution channels and also making sure that we have got processes in place, so the inventory levels are right. And thirdly, to make sure that specific programs have allowed us to go direct to certain major customers to start with. And maybe one of the point, we are also starting a program to go after tier 2 cities in China where there is a lot of opportunity and there we are thinking of certainly some combined products into a single channel around cardiology primarily. So, those are the changes that we are making. The biggest impact ones are really sort of fine tuning our distribution channels themselves, the specific distributors and harmonizing them, streamlining them, more focused fewer of them because that’s essential to be able to maintain control both from a business conduct perspective as well as end-customer reach perspective.

Your next question comes from the line of Bruce Nudell from Credit Suisse.

Good morning. Thanks for taking my question. Omar, regarding the transaction, some people on the buy side have a little bit of consternation about the prospects for the minimally invasive surgery franchise of Covidien. On the other hand, you're going to have a broader playground to work in, more applications that you could tailor this. But specifically people are somewhat concerned about resurgence, robotics, et cetera. How do you view the long-term prospects of that series of applications?

I’ve had a chance to visit two of their plans to work in these areas both in terms of the minimally invasive area as well as the advanced energy businesses and you really have to look at the two together because some of the tools integrated with the minimally invasive some products to create actually a more integrated offering than many of the competitors have. So I left those visits with a clear sense that there is a lot of focus on innovation, on next generation products and from a position of strength, not from a position of catching up which actually in these areas make quite a difference because some of these product lines require a lot of clinical expertise and clinical know how and clinical intervention if you like in the development. And I felt that the teams that I visited had a very strong experience in those areas. Good product positions today and very exciting technology plans for the future. So there is competition always and J&J is a good competitor, but I’ve got every confidence of the teams that are in place in Covidien and the people that I’ve met are absolutely capable of not only competing against anyone both from an edge and attitude perspective but also from a technical and clinical know how perspective.

Thanks. And I guess my follow-up; either you or Gary could speak to. Clearly administration wants some changes in the inversion attractiveness. And one of the things that's difficult to model or at least more challenging for us to model is if the law does change, how will you kind of assess the value of access to ex-US cash? I mean, just schematically, how should we be thinking about that value if worse in fact does come to worse.

Look, this is difficult for us to model too. We don’t know what is going to be and it’s pure speculation, at this stage we just did the model based on the current law and we’re really not wasting our time trying to figure out five different iterations that may or may not happen. So at this stage we’re just sticking to what we know.

Yes, Bruce just to add, I mean obviously we’ve been clear that all the advantages outside the strategic benefit of Covidien is that we do get access to the our O-U.S. cash and that’s the question we are happy addressing, if there are changes to any rules and regulation we’re going to happy determining how do we get access to that, because that’s the benefit of it. But as Omar said it’s just -- right now it’s just the pure speculation on our part and we are not even doing any modeling because we have no idea of whether there will be any changes at all as move ahead.

We’re just close on the transaction.

Your next question comes from the line of Matthew Taylor from Barclays.

I wanted to ask one on emerging markets. You talked a little bit about some of the changes in China and India. There has been a couple reports about China looking to really source some more products locally. I wondered if you could talk to how that could impact your strategy longer term and whether it just means you need to change some of your structure, some of your partnerships and how you may be able to continue to win there if the market goes more towards local products.

There hasn’t been any broad move of that nature in China that’s consistent across the whole country for all products. So I am not sure that will be driven by broad-based regulation. However, China is a big enough market on its own with unique customer requirements that local manufacturing of various sorts will be something that’s going to happen in China and then so we are committed to that as you know. We already have strong local manufacturing through in orthopedics and spine where we’ve established over many years and accelerated by our recent acquisitions. We have also just last quarter finalized an agreement with LifeTech which will allow us to manufacture pacemakers locally and then finally we as I mentioned on the call, building a very promising partnership with one of the sub-provinces for the manufacturing of dialysis -- hemodialysis equipment and that platform also grow to include other products. Covidien by the way also has strong manufacturing and R&D capabilities in China. So put together, we will have enough options to be able to go local in China depending on what the regulations maybe but we hope that we don’t have to wait for regulations, but on the leading edge of this and doing it because of true customer demand that we sense so that we can fulfill local needs in the most appropriate fashion. So I think we’re very well positioned to take advantage of any change or otherwise in China for manufacturing.

Thanks and I know you're focused on closing the transaction. You can't speculate on what's going to happen. I think it's been a little bit surprising to see some of the rhetoric; some of the things that are being said by politicians are erroneous. What has surprised you most about some of the potential changes that are being talked about? And do you feel like your message about investing in the US and tax is resonating with Capitol Hill?

Look, I think it’s great to see that our message around reinvesting in the U.S. has been positively received by everybody and I think that’s fair. And I think in the mix of this is beyond Medtronic is just an overall number of transactions that are potentially is causing some consternation I guess again we there is not much we can do about those things we’re going to put our message out as accurately as possible in general in the fashion as we know how. And then focus on the strategic benefits and make sure that we know how to dial those in. I think that’s all we can do at this stage. I am not prepared to comment in any political sentiments that may be there.

Thanks Matt. I’d say we’ve gone past top of the hour but we’ll take two last questions.

Your next question comes from the line of Josh Jennings from Cowen & Company.

Hi, good morning, gentlemen. Thanks a lot for taking the questions. Two quick ones for Mike Coyle, a follow-up on Bob's question on the CRM business. If you think about the US business being one of the anchors to corporate-wide growth, you do have a new quad pole system that's been approved. Can you help us, Mike, take us through some of the puts and takes of the pressures that you've been experienced. You did mention in one of your previous comments about the replacement cycle for Medtronic specifically. I think Chris O'Connell, one of the other anchors to top line growth has been the spine business, the projection is to get back to growth in FY15. Can you talk about the path to get back to at least market growth rates for the US ICD business?

Before Mike and Chris jump in, I do want to point out that although those are both important markets, the level of diversification that we now have across our entire business mix is much more resilient due to changes in just those two market segments. And we continue to go ahead in that dimension not because those two markets aren’t important but because there are several others as well and to the degree that we can diversify overall business and continue to do so it is a very important initiative for us. So, with that I’ll let Mike go ahead and talk about the ICD the market.

First, relative to ICD, is I think if you the challenges in the quarter are U.S. challenges. So again if you look internationally, back at market share capture and overall market growth and so we expect the CRTD product entry is going to be a big aid to that issue. But as Omar pointed out, the fact that we actually are able to see growth in the overall implantable segment because of the addition of the new product category essentially and link is really going to help drive growth there and you’re obviously now looking at a lower power segment that is in this reported quarter is showing market growth in sort of both the 3% to 4% range which we haven’t seen in that segment for quite some time. So, we have a very diversified product portfolio across CEG with number of new growth drivers to offset areas of flat performance and obviously that showing up in the numbers this quarter.

Chris you want to comment on spine…

Sure. Josh on spine as Omar stated the U.S. core was a little soft in the quarter and we were expecting some of that really due to the timing of some of the new products launches as you know we just got FDA approval on PRESTIGE LP which is a really exciting development. We have some revenue for that modeled in Q1 that we’re now into Q2 on. We also mentioned the BMP which was down in the quarter but we’ve just anniversaried the Yale results. And as Omar pointed out, we’ve had four sequential quarters of underlying stability. So those factors and some other real positives international spine particularly the developed markets is doing well and growing better than it has in recent quarters and we had a positive Kyphon quarter and are encouraged by that. So when you put all that together particularly the new product cadence in the U.S. we think we have a good pathway towards growing the U.S. spine business this fiscal year.

And just want a quick follow up on the IN.PACT franchise.

One last one?

Go ahead.

Just a quick one on the IN. PACT franchise, two data sets on drug coated balloons have, at least top line data for IN. PACT and a full data set for Lutonix, can you talk about the international marketplace there for peripheral balloons? It sounds like you grew double digits. And then also when we may see a publication from the IN. PACT study. Thanks a lot.

Yes, just keep in mind, right now, the overall drug coated balloon market is like a $50 million to $60 million global market. So we have that very nice growth with the SFA indication outside the U.S. north of 20%. But we hadn’t yet published to-date and that we are expecting to happen here in the fall which we think will be a nice catalyst for international market growth. And obviously as we’ve seen in a lot of market segments the U.S. PMA approval tends to be a catalyst for global growth as the data really gets validated and then published and assessed. And obviously that’s the kind of data that we have with the IN. PACT Admiral SFA. So we are anxious to see the US approval. We think that will be a catalyst not only for growth in the U.S. but also internationally.

Your next question comes from the line of Larry Biegelsen from Wells Fargo.

One big picture question. In the second calendar, Q2 calendar year, all of the public hospital companies saw an improvement in procedure volume in the US but that didn't show up in most med tech companies' Q2 results except yours, and yours seemed to have been driven largely by new products. So can you talk about what you're seeing from a procedure standpoint in the US through July? And then just for my follow-up, I'll throw it out now. I'm sure the TAVR market -- worldwide market growth numbers caught people's attention. I think you said the US and worldwide was growing over 30%. So can you talk about what you're seeing and what's causing that acceleration since you launched CoreValve? Thank you.

Let me take the first one, I think you are right in fact I know you are right. Our growth in the U.S. was driven by innovation, by new products and their launches and their uptake as opposed to general procedure volume growth which was sort of low single-digit if not flat overall. So, I think as we expected the impact of more patients coming into the system is not something that affects the med-tech companies because we are generally focused on acute care and the level of patients that eventually flow through to acute care from the increased coverage that’s in place now, is relatively small. And so that’s why we are not really seeing any dramatic change in procedure volumes. However, we are very encouraged and excited by seeing the impact of new products which goes to show that innovation in this market, no matter how flat it maybe and whatever people may share about it, if you have true innovation you can get growth in the U.S. so that’s exciting for us. Do you want to take this?

And then on market growth, obviously there have been a number of important catalysts that’s taken place over the last six months with the data obviously on the extreme risk and high risk patient populations, I mean the mortality benefit in the high risk patient population is itself a catalyst. The approval by FDA of those expanded indications. The entry of one of our competitors into Japan and the fact that there are just more companies out talking about TAVR in Europe because of the essential trialing of their new products. All of those things are basically validating the broader role that TAVR can play in the treatment of aortic stenosis and that’s what is driving the overall market growth.

Okay, so thanks everyone for all your questions and we look forward to updating you on our progress in our Q2 call which we anticipate holding on November the 18th. And with that and on behalf of our entire management team, I would like to thank you all again for your continued support and interest in Medtronic. Thank you and have a great day.

This does conclude today’s conference call. You may now disconnect.