Abstract
Boston Scientific develops and manufactures products for use in
minimally-invasive procedures. This report provides a full review of the
company' s activities.
Boston Scientific, headquartered in Natick, Massachusetts, USA, develops and
manufactures products for use in minimally-invasive procedures. The company' s
products are offered by three dedicated business groups; Cardiovascular,
Endosurgery and Neuromodulation.
The Cardiovascular organisation focuses on products and technologies for use
in interventional cardiology, peripheral interventions, cardiac and vascular
surgery, cardiac rhythm management (CRM), electrophysiology and neurovascular
procedures. The key product in this area is the Taxus paclitaxel-eluting
coronary stent system, which holds the second position in the global market
for drug-eluting stents (DESs) after Johnson & Johnson' s Cordis franchise' s
Cypher product. Taxus and Cypher are also the only two DESs available in the
US, where Taxus has the leading market position.
The CRM and cardiac surgery operations were gained by Boston Scientific' s
much-publicised US$27 billion merger with Guidant in April 2006, where it
out-bid its main competitor, Johnson & Johnson, that had previously entered
into a merger agreement with Guidant. In order to gain antitrust approval for
the transaction, Guidant' s vascular intervention and endovascular businesses
were sold to Abbott, with both Boston Scientific and Abbott sharing rights to
Guidant' s Xience V DES programme. As a result, Boston Scientific is the only
company with access to two DES platforms and two DES drugs. The company will
market the Xience V product as the Promus DES and recently received the CE
mark for the product.
The merger added implantable defibrillator systems, including implantable
cardiac resynchronisation therapy defibrillators, as well as pacemakers and
cardiac surgery products, to the Boston Scientific portfolio. However,
Guidant' s CRM business has faced problems since the beginning of 2005, when it
undertook the withdrawal of around 200,000 products. While it seemed these
recalls would enable Guidant to rectify any issues before it merged with
Boston Scientific, the problems continued and Boston Scientific issued a
further recall of products affecting over 27,000 patients in June 2006. These
recalls have affected the market' s confidence in Guidant' s CRM products and
have led to the filing of several lawsuits.
The transaction also came at a cost to Boston Scientific, with the company
assuming a large amount to debt and giving equity to Abbott, as well as having
to pay US$705 million to J&J as a result of its Guidant merger termination. In
addition, J&J has recently filed a lawsuit against Guidant, Boston Scientific
and Abbott related to the merger, seeking damages of at least US$5.5 billion.
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