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.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV