Analyst Calls Boston Scientific's (BSX) WATCHMAN Delay Disappointing

Deutsche Bank maintained a Hold rating on Boston Scientific (NYSE: BSX) with a price target of $14.00. Comments follow news its WATCHMAN device will need to go before a third FDA Advisory Panel.

"Boston had expected WATCHMAN approval in 1H14 and the latest expectation was approval before the end of the month, thus this news is disappointing. Boston has updated their approval timing to now 1H15. As a reminder, WATCHMAN is a left atrial appendage closure device that is implanted to prevent thromboembolism (which cause strokes) from the left atrial appendage," said analyst Kristen Stewart.

"Despite the delay, Boston Scientific noted it continues to expect 2014 sales to be in the range of $7.3-$7.5 million, up 2%-5% on a reported basis and up 3%-5% on a constant currency basis. Guidance did include a 100bps benefit from the cumulative benefit of sales adjacencies products including WATCHMAN, Lotus Valve, and Alair (among others). We had been modeling only a modest amount from the US WATCHMAN approval as we had anticipated a slow ramp. The device has been approved in Europe (since 2011) and has been growing. Longer term, Boston projected the LAAC market opportunity at $500M and expected its sales to ramp to $200M+ in 2017," added the analyst. "The delay is disappointing. It does not change our overall view on BSX. We believe the company has the right strategy and the turnaround is underway. While we acknowledge some upside to the stock, we rate a Hold."

For an analyst ratings summary and ratings history on Boston Scientific click here. For more ratings news on Boston Scientific click here.

Shares of Boston Scientific closed at $12.92 yesterday.

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