Boston Scientific Set To Expand Presence In Neurological Surgery With CE Win For New DBS Technology

Medical devices manufacturer Boston Scientific (NYSE:BSX) is set to expand its presence in the neurological surgery market, having recently received CE approval for its Vercise Primary Cell (PC) Deep Brain Stimulation (DBS) System in the European markets. ^[1] The DBS devices market is estimated to be worth nearly $2 billion and is expected to cross $3 billion by 2020 at an annual growth rate of about 9%. ^[2] The new Vercise DBS System is Boston Scientific’s first product in the DBS devices market and is the sixth addition to its neurological surgery product portfolio.

Our price estimate of $15 for Boston Scientific is about 10% lower than its current market price.

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Device May Boost Boston Scientific’s Neuromodulation Market Share

DBS devices are used to treat neurological disorders such as Parkinson’s Disease and Alzheimer’s Disease. ^[1] The global neuromodulation market is estimated to be worth nearly $5 billion in 2015, and is forecast to expand at an annual clip of over 11% through 2021. The DBS devices market is a subset of the broader neuromodulation market. Rising instances of Parkinson’s Disease and early identification thereof, growth in the global geriatric population, and increasing awareness of neurological disorders are expected to contribute to the growth of the DBS devices market. ^[2]

We estimate that Boston Scientific currently commands a market share of slightly over 10% in the global neuromodulation market. This is based upon the company’s presence in the Spinal Cord Stimulation market only, since it did not compete in any other segments of neurological surgery – until now. Successful proliferation of the Vercise DBS system is likely to boost Boston Scientific’s share in the neuromodulation market over the medium term.

However, it should be noted that the company has received CE approval for the Vercise DBS system for European markets only. The product is still under investigational use only in the U.S. and it is unclear when it may be cleared for commercial use. ^[1] Nevertheless, Europe is the second largest market for DBS devices after North America. Thus, the CE approval is likely to help Boston Scientific gain share in the global neuromodulation market.

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1. Boston Scientific Wins CE Mark for Vercise DBS Technology, Zacks, September 11, 2015 [↩] [↩] [↩]
2. Global Deep Brain Stimulation Devices Market to Grow at a CAGR of 8.9% by 2020, Triggered by Parkinson’s disease, Transparency Market Research, August 19, 2015 [↩] [↩]