Boston Scientific Adds Another Product To Its Portfolio

Boston Scientific (NYSE: BSX) was successful in receiving FDA and CE approval for its EMBLEM Subcutaneous Implantable Defibrillator (S-ICD) System. The S-ICD is implanted in patients who are prone to sudden cardiac arrests caused by heart rhythm disorder. In a standard S-ICD system, the leads of the defibrillator do not touch the heart. This reduces the risks associated with conventional transvenous implantable cardioverter-defibrillators (T-ICDs) including blood infection and lead replacement. ^[1] The EMBLEM S-ICD will be launched in a limited market in certain European health institutions, which will be followed by a wider release of the product in May 2015. This product plans to hit the U.S. markets in the third quarter of 2015.

The Emblem S-ICD device is a part of the Boston Scientific’s Cardiac Rhythm Management division. The CRM division includes pacemakers, implantable cardioverter defibrillators (ICDs), and other products used to treat heart conditions.

We have a price estimate of $15 for Boston Scientific, which is slightly below the current market price.

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Benefits Over Previous S-ICD System

The Emblem S-ICD is an improvised version of Boston Scientific’s conventional S-ICD over parameters such as size and longevity of the device. Emblem S-ICD is 19% thinner and equipped to last 40% longer than the older version of S-ICD. This will help in lowering the frequency of replacement and consequently reduce patient costs. This technology system is also equipped with the Latitude NXT Patient Management System, which will enable the patient’s healthcare institution to track the performance of the device remotely.

Expected Market Size

In 2014, the global defibrillator market was estimated to be at around $9.2 billion and is expected to grow at a CAGR of 6.9% through 2019 to reach $12.9 billion, with North America comprising about 40% of the total market. ^[2]

The launch of this device is likely to bolster the company’s CRM revenue by encouraging patients who are at a risk of SCA to opt for the use of this device. CRM, the second largest revenue source for the company, accounts for about 26% of its total revenues. In 2014, the company reported revenues from its CRM division of $1.9 billion, a 1.4% year-over-year increase.

New Products to Watch Out For in 2015

The performance of the CRM division seems promising for this year, as the company has a strong pipeline of products to introduce in the market. In February 2015, the company launched its Extended Longevity (EL) ICDs, including DYNAGEN EL and INOGEN EL. The company claims that these models have better longevity compared to competitors’ devices, lasting for 12 years. ^[3] Last week, the company also received FDA approval for its Watchman Heart Device that could reduce the incidence of stroke in patients who could not take the standard anticoagulant, warfarin. These new products could accelerate the growth rate of the company’s CRM division in the near future.

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1. Boston Scientific announces FDA and CE Mark Approval Of The EMBLEM™ S-ICD System, Boston Scientific [↩]
2. Defibrillators Market by Product, by End User – Global Forecast to 2019, PR Newswire [↩]
3. Boston Scientific Launches World’s Longest Lasting ICD, Press Release [↩]