Boston Scientific Shares Slump On Dim Outlook

WASHINGTON (AP) — Shares of Boston Scientific plummeted Tuesday after the medical device maker forecast disappointing earnings and warned that health reform legislation could double its tax burden.

Chief Executive Ray Elliot said the $4 billion-a-year tax proposed by Senate lawmakers could force the company to lay off as many as 2,000 employees. The proposal is part of a massive effort to provide health coverage for most Americans while also lowering the government's health care bill.

But Elliot told analysts the legislation could add up to $200 million per year to the company's tax liability.

Executives from rival device maker Johnson & Johnson had similar complaints after reporting earnings last week. And the industry's trade group, AdvaMed, has lobbied aggressively against the tax, saying it would be passed onto patients.

Senate Democrats argue that hospitals and drugmakers have already volunteered to take cuts to help pay for the health care overhaul — and so should device companies.

The Natick, Mass., company said late Monday it returned to profit in the third quarter, earning $200 million, or 13 cents per share, compared with a loss of $62 million, or 4 cents per share, a year earlier. Sales in the most recent period were $2.025 billion. The results came in shy of estimates from analysts surveyed by Thomson Reuters, who expected slightly higher net income of 14 cents per share on sales of $2.04 billion.