Boston Scientific Acquires Intelect Medical
NATICK and BOSTON, Mass., Jan. 5, 2011 /PRNewswire/ -- Boston Scientific Corporation (NYSE: BSX) today announced it has acquired Intelect Medical, Inc., a development-stage company located in Boston. Intelect Medical is developing advanced neuromodulation technologies for deep brain stimulation (DBS) therapy. The transaction values Intelect Medical at $78 million with no cash and no debt on its balance sheet. As a result of Boston Scientific's existing equity and debt positions in Intelect Medical, the total cash payment by Boston Scientific was approximately $60 million, which was funded with cash on hand. Boston Scientific expects the transaction to have an immaterial impact on its GAAP and adjusted earnings per share in each of 2011, 2012 and 2013, and to be accretive starting in 2014.
DBS involves the implantation of a lead into the brain and a pulse generator into the chest that sends electrical impulses to the lead. Boston Scientific estimates the current worldwide market for DBS at $400 million with projections to grow to more than $1.5 billion by 2020.
Intelect Medical is developing the GUIDE™ DBS programming system, the first system to enable clinicians to visualize stimulation fields in the brain and provide more precise targeting of therapy. This innovative technology -- combined with Boston Scientific's Vercise™ DBS System -- is expected to provide clinicians substantially improved treatment for their patients. The Vercise DBS System is a neurostimulation device designed to deliver electrical signals to specific areas within the brain through individual lead contacts that allow a more tailored amount of current flow based on patient needs. Boston Scientific recently announced the first Vercise DBS System implant as part of its VANTAGE clinical trial to treat Parkinson's disease. Parkinson's disease is a progressive neurodegenerative disorder that affects 7 to 10 million people worldwide, according to the World Health Organization.
"The acquisition of Intelect Medical supports our long-term strategy of enhancing our product portfolio and gaining market share in the Neuromodulation space, and it will help us to provide the most advanced deep brain stimulation technology solutions for neurologists, neurosurgeons and their patients," said Michael Onuscheck, Senior Vice President and President, Neuromodulation for Boston Scientific. "The GUIDE DBS system promises to be a major advance in deep brain stimulation therapy, especially when used in conjunction with our Vercise DBS System."
"This acquisition represents additional progress in our strategy to realign Boston Scientific's portfolio through the execution of our Priority Growth Initiatives," said Ray Elliott, President and Chief Executive Officer of Boston Scientific. "Deep brain stimulation has enormous potential, and it is an important part of our Neuromodulation business growth plans. We will continue to pursue additional Priority Growth Initiatives to strengthen our Company by buying or building products we understand, to be sold through sales forces we already have."
The Vercise DBS System is an investigational device and is limited by applicable law to investigational use only and is not available for sale.
About Boston Scientific
Boston Scientific is a worldwide developer, manufacturer and marketer of medical devices whose products are used in a broad range of interventional medical specialties. For more information, please visit: www.bostonscientific.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may be identified by words like "anticipate," "expect," "project," "believe," "plan," "estimate," "intend" and similar words. These forward-looking statements are based on our beliefs, assumptions and estimates using information available to us at the time and are not intended to be guarantees of future events or performance. These forward-looking statements include, among other things, statements regarding clinical trials, regulatory approvals, expected accretion/dilution, estimates and projections for the size of the DBS market, clinical outcomes, financial performance and product performance. If our underlying assumptions turn out to be incorrect, or if certain risks or uncertainties materialize, actual results could vary materially from the expectations and projections expressed or implied by our forward-looking statements. These factors, in some cases, have affected and in the future (together with other factors) could affect our ability to implement our business strategy and may cause actual results to differ materially from those contemplated by the statements expressed in this press release. As a result, readers are cautioned not to place undue reliance on any of our forward-looking statements.
Factors that may cause such differences include, among other things: future economic, competitive, reimbursement and regulatory conditions; new product introductions; demographic trends; intellectual property litigation; integration of acquired companies; financial market conditions; and future business decisions made by us and our competitors. All of these factors are difficult or impossible to predict accurately and many of them are beyond our control. For a further list and description of these and other important risks and uncertainties that may affect our future operations, see Part I, Item 1A – Risk Factors in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission, which we may update in Part II, Item 1A – Risk Factors in Quarterly Reports on Form 10-Q we have filed or will file hereafter. We disclaim any intention or obligation to publicly update or revise any forward-looking statements to reflect any change in our expectations or in events, conditions, or circumstances on which those expectations may be based, or that may affect the likelihood that actual results will differ from those contained in the forward-looking statements. This cautionary statement is applicable to all forward-looking statements contained in this document.