Medical device giant Boston Scientific (NYSE:BSX) has notched billions in goodwill write-offs related to its 2006 acquisition of Guidant Corp., a signal that the $28 billion purchase price was too high, the Wall Street Journal reported.
Boston Scientific has written off $9 billion in goodwill since 2007, including $3.6 billion in last month’s financial report. Most of that was associated with the Guidant merger, although the company’s financial statements don’t specify, according to the Journal.
Up until the most recent write-off, Boston Scientific’s goodwill topped its market capitalization, a "clue" that investors think the company’s overvalued, according to the article.
Unnecessary ICD probe signs of a larger trend?
Hospital executives and industry analysts aren’t too worried about hospitals in the ongoing probe of allegedly unnecessarily implanted heart devices, believing that hospitals will weather the civil penalties that are the most likely outcome, analysts for Leerink Swann wrote.
The larger concern is for the crackdown on stent and defibrillator use and narrowing of criteria amid ongoing controversy about the potential risks and benefits of the products, according to the analysts.
That could mean more pressure on the already-struggling cardiac rhythm management market as scrutiny remains tight on the medical necessity of the expensive devices.
"ICD volumes may come under incremental pressure as both Medicare and hospitals more closely regulate procedures given the high cost of the devices," analysts wrote of one anonymous hospital specialist’s opinion. "In terms of pricing, he sees manufacturers lowering prices longer term as they are squeezed by both providers and payors, citing the example that his hospital pushes for a 5%-10% price discount each time a contract is renewed."
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Mobile health summer
The FDA handed out 510(k) clearances to several health-based mobile app makers in June and July, including for Bluetooth-enabled blood pressure monitoring and surgical sponge management. Read more
Masimo’s enters capnography market with $30M Phasein buy
Irvine, Calif.-based oximetry devices maker Masimo (NSDQ:MASI) entered the noninvasive multigas monitoring market with the $30.4 million acquisition of capnography and capnometery solutions developer Phasein.
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GPOs:
- Novation touts radiopharmaceutical product agreements with GE Healthcare, Triad Isotopes, UPPI, IBA Molecular and PENET
- Premier signs Medline Industries, Smiths Medical and Vital Signs for disposable anesthesia products
Analysts’ ups and downs
- Haemonetics (NYSE:HAE): Barrington maintains "outperform" rating, raises price target
- Medtronic (NYSE:MDT): Leerink Swann maintains "market perform" rating, $42 price target
- Siemens (NYSE:SI): Fitch Ratings affirms long-term IDR at "A+," subordinated rating at "A-" and short-term iDR at "F1" with stable outlook
- Smith & Nephew (FTSE:SN, NYSE:SNN): Piper Jaffray & Co. maintains "neutral" rating, lowers price target from $54 to $53
- Syneron Medical Ltd. (NSDQ:ELOS): Leerink Swann sets "outperform" rating, $16-$17 price target
- Thoratec (NSDQ:THOR): Leerink Swann maintains "outperform" rating, $45 price target
- Teleflex (NYSE:TFX): Leerink Swann raises price target from about $67 to around $69
