(Boston Scientific story updated with CEO compensation data)
Natick, Mass. (
woes weren't letting up headed into the holiday weekend.
The embattled medical device stock, reeling from its defibrillator recall, was projected by a Wells Fargo Securities analyst report to lose as much as $469 million in sales during the next two years.
In the middle of March, Boston Scientific announced that it would have to pull its defibrillators from the market after it realized that changes made to the devices' manufacturing process required FDA review. The
market reaction to what was just the latest in a series of missteps from Boston Scientific was fast and furious selling.
On Thursday, it wasn't only the Wells Fargo analyst report that dogged Boston Scientific. A Citigroup analyst told
that Boston Scientific might be forced to sell its pain-management business to patch up its financial situation as a result of the estimated $5 million it is shedding daily as a result of the defibrillator recall.
The Citibank analyst told
that the pain-management business could fetch between $1 billion and $1.6 billion in a sale.
Boston Scientific has $2.7 billion in debt coming due in 2011.
One angle from which Boston Scientific is not in a cash pinch is from its corner office.
In an unfortunate bit of timing, Boston Scientific also recently filed its annual CEO compensation data with the SEC. The compensation filing showed that new CEO Ray Elliott -- hired to turn around the struggling medical device maker -- was paid a $1.5 million signing bonus and stock and option awards valued at more than $29 million in 2009.
The $33.4 million total pay package for Elliott included a salary of $598,356, the signing bonus, a cash bonus of $607,766, and the stock and option awards -- though the options awards have declined in value as Boston Scientific's stock price has fallen.
Boston Scientific also paid more than $1 million in relocation costs for Elliott, and $197,906 to cover Elliott's use of a company plane.
Boston Scientific's two main competitors,
St. Jude Medical
, are viewed as the main beneficiaries from the heart-device recall.
Medtronic has the largest market share in the heart device market and might gain the most in absolute terms from the Boston Scientific recall. However, St. Jude derives a larger portion of its revenues from a similar heart device.
St. Jude Medical receives as much as 20% of its revenues from the heart-device market, versus a revenue level in the low double digits for Medtronic.
Boston Scientific shares shrugged off the latest negative reports related to the recall and closed marginally positive on the last trading day before the Good Friday holiday.
The shares had fallen as low at $6.31 in the wake of the recall -- though even before the decline, some analysts believed the shares were trading at a floor.
Boston Scientific shares have since recovered to close at $7.20 on Thursday. Shares had been as high as $8 in early March before the latest bad Boston Scientific news broke.
-- Reported by Eric Rosenbaum in New York.
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