By Jon Kamp
Of DOW JONES NEWSWIRES
A top St. Jude Medical Inc. (STJ) official in charge of sales and marketing is stepping down and retiring shortly after the company announced weaker-than-expected quarterly results pegged to slow sales at U.S. hospitals.
Joseph H. McCullough, 59, group president for the U.S. and international division, plans to retire effective Nov. 1, St. Jude said in a filing with the Securities and Exchange Commission. His duties will be divided between Michael T. Rousseau, St. Jude's other group president, and Chief Executive Daniel J. Starks.
St. Jude declined on Monday to comment on McCullough's departure beyond saying that he's retiring. But the move comes days after Starks said the company will hold its leaders accountable and is making changes where needed.
"Where we have the right leadership in place, we continue to maintain a high level of operating discipline," Starks said during St. Jude's earnings conference call last Wednesday. "Where we do not have the right leadership in place, we are making changes."
"Starting with me, our leadership team is accountable for making sure that spending does not get ahead of sales," Starks also said, while adding that St. Jude will take corrective actions when needed. The company recently cut about 450 jobs.
Sales in the recent quarter were slowed by U.S. hospitals either refraining from purchasing heart-rhythm devices or pushing for price cuts St. Jude wouldn't accept.
"We view the sudden departure of what appears to be STJ's No. 2 position as part of a broader shakeup within the company," Citigroup analyst Matthew Dodds said in a note to investors.
Going forward, Rousseau will assume responsibility for St. Jude's U.S. division - a business Rousseau led for six years until January 2008 - while he continues to oversee the company's big heart-rhythm devices unit.
The international division and the business units for atrial fibrillation, cardiovascular and neuromodulation products will report directly to CEO Starks. The product-related units have been reporting to Rousseau.
As head of the product units, Rousseau has been responsible for products from concept to launch. But once launched, management responsibility shifted to McCullough's divisions.
Both Rousseau and McCullough were appointed to their group president positions about two years ago as part of broader moves to expand St. Jude's organizational structure. At the time, Starks described the moves as part of St. Jude's comprehensive program to again double its size within five years.
The company's shares rose 0.9% to $34.72 in late trading Monday.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728; jon.kamp@dowjones.com