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'Other' revenue from oil wells, stores and more add to Mayo Clinic's bottom line

In the shadow of the big numbers in Mayo's annual financial report is a small column near the end, marked: “Other Revenue.” It accounted for $1.13 billion in 2021. That’s up from $1.11 billion in 2020.

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ROCHESTER — Medical services and donations bring in the bulk of Mayo Clinic’s money each year.

But a billion dollars more in “other revenue” roll in from oil production, retail stores, cafeteria sales and royalties.

Mayo Clinic issued its annual report for 2021 on Monday with a total revenue of $15.7 billion and an operating income of $1.2 billion. Revenue from medical services was $13.3 billion, up 15.6% from $11.5 billion in 2020.

In the shadow of those big numbers is a small column near the end of the audited financial statement called “Other Revenue,” which accounted for $1.13 billion in 2021. That’s up from $1.11 billion in 2020.

Mayo oil and gas

The biggest one-year increase among the “other revenue” money streams was the "Oil- and gas-producing activities" category, which hit a gusher with 119.5% increase to $101 million. That's up from $46 million in 2020.


Mayo Clinic is the majority owner of Latigo Petroleum LLC, an oil and gas company formed by Mayo and other investors in 2013. Latigo owns and operates oil and gas wells in Roberts and Ochiltree counties in the Texas panhandle.

"We formed Latigo to further develop oil and gas mineral interests donated to Mayo in the 1990s by Barbara Woodward Lips. … Latigo’s oil and gas development activities will enhance the future mineral interest royalties that flow to Mayo in addition to generating a minor amount of operating income," Mayo Clinic Spokeswoman Susan Barber Lindquist said in 2017.

This little-known Mayo Clinic sideline business, an oil-drilling firm based in Odessa, Texas, has been pumping out revenue for many years. However, those numbers have really shot up in recent years.

In 2017, oil and gas revenues were $18 million. That grew to $28 million in 2018 and 2019, before jumping to $46 million in 2020. The oil and gas category first appeared on Mayo Clinic’s books in 2013, when it brought in $700,000.

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Mayo Clinic’s oil investments have brought in $221 million in revenue in the past five years. When asked why the oil and gas revenue was growing so much, Mayo Clinic officials declined to discuss the topic.

“Detailed information on our investment portfolios is confidential and we do not disclose publicly any more than is included in our audited financial statements. All proceeds from our investments are used to support Mayo Clinic’s mission of research, education and clinical care,” Karl Oestreich, Mayo Clinic’s interim division chair of consumer communications.

Mayo retail

Selling prescriptions at their pharmacies and medical equipment at their retail stores has continued to do well for Mayo Clinic throughout the pandemic.

Retail pharmacy sales brought in $436 million in 2021, an 11% increase from 2020. Prescription sales accounted for $355 million in 2019 and $330 million in 2018.


Mayo Clinic’s branded retail stores found on its major campuses brought in $67 million in 2021, a 17.5% jump from $57 million in 2020. The Mayo stores accounted for just $38 million in 2019, down from $44 million in 2018.

Mayo royalties

Royalties from licensing and patents on things such as drugs and medical devices brought in $166 million, a 28.6% increase from $129 million in 2020. Mayo royalties generated $117 million in 2019 and $97 million in 2018. That’s up from $95 million in 2017 and $61 million in 2016.

Mayo tech commercialization

“Technology commercialization, health information and medical products” have also generated a significant amount of revenue, though it has not been a steady progression.

Commercialization brought in $52 million in 2021. That’s a 6% increase over $49 million in 2020, though significantly down from $82 million in 2019.

Commercialization accounted for $78 million of revenue in 2018 and $54 million in 2017.

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Mayo education

The “Other revenue” column also includes a “Graduate medical, other education” category, which has been up and down in recent years.

Education generated $35 million in 2021. That is an increase of 55% percent from $22 million in 2020. However, 2020’s $22 million was a steep drop from $41 million in 2019 and $38 million in both 2018 and 2017.


Mayo lunch money

One category that recovered somewhat after predictably dropping quite a bit during the early days of COVID-19 pandemic is cafeteria revenue. Mayo Clinic's campus cafeterias serve meals to employees and visitors. A large number of Mayo Clinic employees have transitioned to remote work, while visitors have been restricted through much of the pandemic.

Mayo Clinic (Outdoors)

Cafeteria revenue increased by 11% to $29 million in 2021, up from $26 million in 2020.

However, revenue is not back to pre-pandemic levels. In 2019, cafeteria food generated $37 million. Each of the three years prior — 2018, 2017 and 2016 — revenue from Mayo's cafeteria was $35 million.

The ‘Other’

The “Other revenue” column also includes a mysterious, undefined category called “Other.”

While it is unclear what is included in the “Other” category, it did increase to $244 million in 2021.

That is up from 28.4% from $190 million in 2020. “Other” tallied $320 million in 2019, $172 million in 2018 and $279 million in 2017.

Jeff Kiger tracks business action in Rochester and southeastern Minnesota every day in "Heard on the Street." Send tips to jkiger@postbulletin.com or via Twitter to @whereskiger . You can call him at 507-285-7798.

Jeff Kiger writes a daily column, "Heard Around Rochester," in addition to writing articles about local businesses, Mayo Clinic, IBM, Hormel Foods, Crenlo and others. He has worked in Rochester for the Post Bulletin since 1999. Send tips to jkiger@postbulletin.com or via Twitter to @whereskiger . You can call him at 507-285-7798.
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