Boston Scientific Feels Guidant's Pain
Boston Scientific (BSX) is recalling a group of pacemakers and defibrillators, all of which were made by the business that used to be the stand-alone company Guidant, because the devices could fail.
The recall covers the Insignia and Nexus pacemakers, Contak Renewal TR/TR2 cardiac resynchronization pacemakers and Ventak Prizm 2, Vitality and Vitality 2 implantable cardioverter defibrillators. The products are made by Boston Scientific's cardiac rhythm management group that was formerly part of Guidant.
Boston Scientific, based in Natick, Mass., said it had recently identified a low-voltage capacitor in the devices that isn't performing properly. A capacitor is an electrical-charge storage component.
Some capacitors, if not working properly, could lead to a malfunction. To date, five defects have been confirmed, but no deaths have been reported. Roughly 27,200 of the devices have been implanted.Product recalls are nothing new to Guidant. Boston Scientific acquired the company on April 21 after prevailing in a bidding war with Johnson & Johnson (JNJ). J&J had originally planned to buy Guidant, but balked last year after the company recalled thousands of heart devices over several months. Ultimately, J&J said it would still finish the deal, but at a lower price. However, Boston Scientific emerged with a higher bid, and after a series of amended proposals ended up with Guidant. Shares of Boston Scientific were trading at a 52-week low, dropping $1.33, or 7.3%, to $16.93. The stock's lowest close in the past year is $18.06, and its high is $29.35. Volume was more than twice as heavy as normal.
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