Medical device maker Boston Scientific Corp. said Thursday it intends to drive growth in 2018 and beyond with new product launches in all its major divisions, following a quarter in which each of the divisions posted sales growth.
Sales of Boston Scientific endoscopy products and pain-fighting neuromodulation devices saw notable sales increases in the just-completed quarter, while higher sales of implantable defibrillators helped offset declines in pacemaker sales in the heart-rhythm device group. The Massachusetts-based company employs more than 5,000 people at locations in Arden Hills, Maple Grove and elsewhere who work on heart and vascular devices and other products.
Although the company announced financial results Thursday that were in line with or exceeded forecasts and projected growth in 2018, the market shrugged, sending shares down 1 percent to $27.63. Analysts noted that Boston Scientific had preannounced its fourth-quarter revenue and earnings goals during a recent investor conference.
"We have good momentum coming out of the company, across the businesses," Chief Executive Mike Mahoney told investors in a conference call.
The cardiovascular-devices division generated $913 million in sales in the fourth quarter, up almost 7 percent on an operational basis. Its Medsurg division, which includes the endoscopy and neuromodulation products as well as urology devices, grew by almost 13 percent to $931 million in sales. The division that sells heart-rhythm products grew just 3 percent to $565 million.
Revenue growth translated into higher adjusted earnings, with adjusted net income of 34 cents per share for the fourth quarter, which was a 13 percent increase. Quarterly revenue of $2.4 billion was in line with results recently announced, at 8 percent organic growth.
Including a one-time charge related to the enactment of the Tax Cuts and Jobs Act, the company reported a loss of $615 million, or 45 cents per share for the three months ended Dec. 31.
For the full year, Boston Scientific reported net income of $104 million, or 8 cents a share, compared with net income of $347 million, or 25 cents per share for the previous year. Full-year revenue was up almost 8 percent.
Looking ahead, Boston Scientific forecast 2018 sales of at least $9.65 billion, above analysts' consensus expectations of $9.61 billion, and adjusted net income of $1.35 per share.
Mahoney highlighted upcoming growth drivers, including launches of the new WaveWriter spinal cord stimulator and Vercise deep-brain stimulation system in 2018, the potential U.S. launch of the Lotus transcatheter aortic valve system in 2019, and U.S. launches of the Acurate neo transcatheter valve and a new Watchman left atrial appendage device in 2020.
He also highlighted Boston Scientific's announcement last week of a $90 million investment in California company Millipede, which is designing a transcatheter annuloplasty ring to treat the common condition of mitral regurgitation.
The investment included the option to acquire Millipede's remaining shares before the completion of its first-in-human clinical trial, which would result in Boston Scientific paying at least an additional $325 million. Mahoney said the device could represent a $1 billion market opportunity by 2021.
Joe Carlson • 612-673-4779
