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BOSTON SCIENTIFIC CORP 8-K Report, Corporate Update (Sep 21, 2021)

Filed September 21, 2021For Securities:BSX

Summary

Boston Scientific Corporation (BSX) announced on September 21, 2021, its definitive agreement to acquire Devoro Medical Inc. This strategic move aims to bolster BSX's portfolio in the peripheral interventions market with Devoro Medical's innovative WOLF Thrombectomy® Platform, a technology designed for rapid clot extraction in various vascular procedures. BSX has been an early investor in Devoro Medical, holding a significant stake prior to the acquisition, which will influence the final transaction cost. The acquisition is structured with an upfront payment and additional payments contingent on achieving clinical and regulatory milestones. While the deal is expected to close in Q4 2021, it is anticipated to have a slightly dilutive impact on adjusted earnings per share (EPS) in 2021, which BSX expects to mitigate through internal efficiencies. The impact on GAAP EPS will be less dilutive due to a one-time gain recognized from the previously held equity stake. For 2022, the transaction is projected to be neutral to adjusted EPS but slightly dilutive on a GAAP basis due to amortization and acquisition-related costs.

Key Highlights

  • 1Boston Scientific to acquire Devoro Medical Inc. for its WOLF Thrombectomy® Platform.
  • 2Acquisition enhances BSX's peripheral interventions portfolio with advanced clot removal technology.
  • 3Transaction includes an upfront payment of approximately $269 million (net of existing equity) and up to $67 million in milestone payments.
  • 4BSX was already a strategic investor in Devoro Medical, holding a 16% equity stake.
  • 5Acquisition is expected to close in the fourth quarter of 2021, subject to customary conditions.
  • 6Transaction anticipated to be slightly dilutive to adjusted EPS in 2021, with mitigation strategies in place.
  • 7Expected to be neutral to adjusted EPS in 2022, with minor GAAP dilution due to integration costs.

Frequently Asked Questions

The acquisition of Devoro Medical strengthens Boston Scientific's position in the peripheral interventions market by adding the innovative WOLF Thrombectomy® Platform, which offers a non-console and lytic-free solution for rapidly capturing and extracting blood clots in critical vascular procedures.

The acquisition involves an upfront payment of approximately $269 million (adjusted for BSX's existing equity stake and other closing adjustments) and potential future payments of up to $67 million (also adjusted) upon the achievement of specific clinical and regulatory milestones.

In 2021, the acquisition is expected to be slightly dilutive to adjusted EPS, a dilution that Boston Scientific plans to offset through internal cost efficiencies. On a GAAP basis, it will be less dilutive due to a one-time gain from the existing equity stake. For 2022, the transaction is not expected to impact adjusted EPS but may cause slight GAAP dilution due to amortization and acquisition-related charges.

The transaction is anticipated to close in the fourth quarter of 2021, contingent upon the satisfaction of standard closing conditions.