Never a Dull Moment for Device Makers

In July, the Abbott Park, Ill., company announced plans to record $200 million in restructuring charges and said it expected to earn 56 cents to 58 cents a share in the third quarter, excluding special items. The consensus estimate is for EPS of 58 cents and revenue of $5.38 billion.

Boston Scientific (BSX Quote - Cramer on BSX - Stock Picks) was another medical device maker that had issues involving patents and recalls.

Last month, Boston agreed to pay an Israeli company called Medinol $750 million to settle a patent lawsuit relating to its Express and Taxus Express devices. Later, its shares were hit when it recalled its Enteryx injection kits for treating reflux after reports of serious adverse events.

In September, CFO Larry Best said third-quarter results were soft, and "revenue and earnings for the quarter are unlikely to reach the levels on which previous guidance for the quarter had been based." The company didn't provide specifics.

Boston Scientific shares sank 13% in the three months ended Sept. 30.

"Management is either going to set the bar really low so people will believe it, or show some convincing share gains in the quarter, which isn't likely considering they've already told people they're not going to make it," Wittes said of Boston Scientific.

Analysts surveyed by Thomson First Call see Boston earning 45 cents a share on $1.56 billion in sales for the latest quarter.

Leerink Swann has provided nonsecurities services to J&J, and a director of Guidant serves as a director of the firm. Leerink Swann doesn't have a business relationship with Boston Scientific, Medtronic or St. Jude.

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