Boston Scientific Cuts View on Implant Woes

“Boston Scientific cut its full-year outlook after two of its core heart-disease products faced unexpected challenges in the second quarter.

 

Revenue from the Watchman heart implant, which is used to reduce the risk of stroke, slowed sharply and unexpectedly, the medical-device maker said Wednesday. Its electrophysiology business, which focuses on treating heart-rhythm disorders, is also struggling to keep up with fiercer competition.

 

As a result, Boston Scientific lowered its full-year sales guidance to 5.5% to 6.5% growth, from 7% to 8.5% previously.

 

It also cut its adjusted earnings-per-share guidance to a range of $3.28 to $3.32, from the prior $3.34 to $3.41.

 

"This update today is not the outcome we planned or what you have come to expect from us," Chief Executive Mike Mahoney told investors on a call. "However, market conditions have evolved quickly and have been challenging to forecast effectively."

 

Shares ended nearly flat at $46.04 in New York.

 

Doctors are changing their referral practices for the Watchman device because there has been a lot of evidence published in recent months about the risk of stroke for people with atrial fibrillation, Mahoney said.

 

Watchman devices are used to prevent strokes in patients with atrial fibrillation, so the new research [1] is making it more complex for doctors to decide whether they should recommend a Watchman to their patients, he said.

 

Additionally, more doctors are inserting Watchman devices concomitantly, meaning they perform the procedure at the same time as another procedure. Mahoney said the 60% jump in concomitant procedures during the second quarter is creating inefficiencies and often replacing standalone procedures, which declined during the quarter.

 

Boston Scientific posted a second-quarter profit of $907 million, or 61 cents a share, compared with $797 million, or 53 cents a share, a year earlier.

 

Stripping out certain one-time items, adjusted per-share earnings were 86 cents, ahead of the 83 cents anticipated by analysts, according to FactSet.

 

Revenue rose 7.5% to $5.44 billion. Analysts surveyed by FactSet forecast revenue of $5.36 billion.

 

MedSurg, the company's business focused on gastrointestinal and urological devices, saw sales rise 5.9% in the quarter, while its cardiovascular segment's revenue increased 8.3%.

 

For the current third quarter, the Marlborough, Mass., company projects revenue will increase 3% to 5%, with adjusted earnings per share estimated at 80 cents to 82 cents. Analysts forecast 84 cents a share.

 

Earlier this week, Boston Scientific said it planned to lay off staff as part of a new restructuring plan. It expects to incur pretax charges of about $700 million to $800 million from the restructuring, it said on Monday.

 

The company said it is aiming to optimize supply chains by transferring some production lines to different facilities. It also wants to streamline its organizational structure, it said. The plan is scheduled to be completed by the end of 2029.

 

Executives said they expect the challenges with Watchman to continue into 2027. They also anticipate a new competitor will enter the market, potentially taking away market share next year.” [2]

 

1. Recent clinical trials like CHAMPION-AF show that the WATCHMAN FLX device is non-inferior to direct oral anticoagulants for stroke prevention and offers superior reduction in non-procedural bleeding, though a slight trade-off in ischemic stroke signals and up-front procedural risks complicate first-line patient selection.

Efficacy and Bleeding Outcomes

•           Non-inferiority met: 3-year data confirms left atrial appendage closure matches oral anticoagulants for the combined endpoint of cardiovascular death, stroke, and systemic embolism.

•           Bleeding reduction: Significant relative decrease in non-procedural bleeding complications compared to continuous blood thinners over time.

•           Ischemic trade-off: Trials noted a slightly higher numerical signal for ischemic strokes in the device arm versus medical therapy when factoring in early events.

Decision-Making Complexities

•           Up-front risk: Procedural complications offset some long-term bleeding advantages, requiring careful balancing by physicians.

•           Broader indications: Data tests the device in populations not strictly contraindicated for blood thinners, blurring traditional lines.

•           Concomitant procedures: A rise in performing closure alongside other cardiac interventions impacts standalone referral habits

2. Boston Scientific Cuts View on Implant Woes. Hamilton, Katherine.  Wall Street Journal, Eastern edition; New York, N.Y.. 30 July 2026: B3.