UPDATE: Boston Sci CEO Keeps Financial Goals For Coming Yrs
July 21 2009 - 12:30PM
Dow Jones News
After a week on the job, new Boston Scientific Corp. (BSX) Chief
Executive Ray Elliott on Tuesday pointed to the same financial
growth goals the medical-devices company had recently targeted for
upcoming years, including earnings that will expand faster than
sales.
Company officials also highlighted the potential impact that a
study for heart-failure devices could have on growth in a key
market for Boston Scientific.
Based on what he's seen thus far, Elliott said he sees no reason
at this time to change Boston Scientific's goal of growing sales by
5% to 7% per year, excluding the effects of foreign currency rates,
in 2010 and 2011.
Elliott said his confidence is based on the quality of Boston
Scientific's sales force, although he added he sees room to expand
that force.
The Natick, Mass., company also is aiming to grow its per-share
earnings by at least a 15% year in coming years, Elliott said
during a call with analysts following the company's second-quarter
earnings release.
He said that by supporting these prior growth goals, he is
"affirming the work that's been done to date."
Shares recently traded down a penny to $10.29.
Part of the company's future growth expectations involve hopes a
major company-funded study will help expand the market for cardiac
resynchronization defibrillators, or CRT-D devices. These tools
provide power to maintain proper beating in erratic hearts and also
have defibrillators on board to provide jolts to correct
life-threatening rhythm problems.
While the devices haven't been used in people with milder
heart-failure symptoms, the "Madit-CRT" study showed they can help
slow the course of heart failure in these patients when compared
with more basic - and cheaper - defibrillators. The upshot is to
potentially boost usage of pricier devices, which could help Boston
Scientific and rivals St. Jude Medical Inc. (STJ) and Medtronic
Inc. (MDT).
Boston Scientific, which recently announced that the study was a
success, expects full data will be released at a European
cardiology conference on Sept. 1. On Tuesday, company officials
said they see potential for the study to grow the U.S. market by up
to $250 million in coming years while growing the global market by
$400 million to $500 million. Elliott said Boston Scientific plans
to file by the end of 2009 with the U.S. Food and Drug
Administration to seek approval to expand marketing of CRT-D
devices based on the study. That would make mid-2010 approval a
possibility.
Elliott, a veteran medical-devices executive who long led
orthopedics company Zimmer Holdings Inc. (ZMH), recently took over
as president and chief executive at Boston Scientific to replace
long-time Chief Executive Jim Tobin, who is retiring.
The company announced quarterly results late Monday that
included sales above Wall Street estimates, bolstered by the
company's business for drug-coated heart stents.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728;
jon.kamp@dowjones.com