guggenheim medtech disruptors virtual conference/media/files/b/... · 2020. 8. 10. · guggenheim...
TRANSCRIPT
Guggenheim MedTech Disruptors
Virtual Conference
Dave Pierce
Executive Vice President andPresident MedSurg
Brian Dunkin, MD
Chief Medical Officer,Medical Affairs, Endoscopy
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may be identified by words like "anticipate," "expect," "project," "believe," "plan," "estimate," "intend" and similar words. These forward-looking statements are based on our beliefs, assumptions and estimates using information available to us at the time and are not intended to be guarantees of future events or performance. These forward-looking statements include, among other things, statements regarding our business plans and product performance and impact, and the impact of the COVID-19 outbreak on the company's results of operations. If our underlying assumptions turn out to be incorrect, or if certain risks or uncertainties materialize, actual results could vary materially from the expectations and projections expressed or implied by our forward looking statements.
Factors that may cause such differences can be found in our most recent Form 10-K and Forms 10-Q filed or to be filed with the Securities and Exchange Commission under the headings “Risk Factors” and “Safe Harbor for Forward-Looking Statements.” Accordingly, you are cautioned not to place undue reliance on any of our forward-looking statements. We disclaim any intention or obligation to publicly update or revise any forward-looking statements to reflect any change in our expectations or in events, conditions, or circumstances on which they may be based, or that may affect the likelihood that actual results will differ from those contained in the forward-looking statements.
Market Estimates:
Unless noted otherwise, all references to market sizes, market share positions, and market growth rates are BSX internal estimates.
Non-GAAP Measures:
This document contains non-GAAP measures (denoted with *) in talking about our company’s performance. The reconciliations of those non-GAAP measures to their most comparable GAAP measures are contained within this document including appendices attached to the end of this presentation.
Financial Disclaimers:
Operational revenue growth excludes the impact of foreign currency fluctuations. Organic revenue growth excludes the impact of foreign currency fluctuations, sales from the recent acquisitions of Vertiflex, Inc. and BTG plc (BTG), each with no prior year comparable sales. Organic revenue growth also excludes the impact of the divestiture of our global embolic microspheres portfolio, a transaction entered into in connection with obtaining the antitrust clearances required to complete the BTG transaction.
Regulatory Disclaimers:
EXALT™ Model TG – Device under development. Not available for use or sale worldwide.
EXALT™ Model B – Device under development. Not available for use or sale worldwide.
SpyGlass™ DS III - Device under development. Not available for use or sale worldwide.
Safe Harbor for Forward-Looking Statements
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 2
$2.8B, +11%, +10%
2019 revenue $10.7B, 11.1% operational* growth, 7.3% organic* growth
Boston Scientific:
Category Leadership Driving Growth
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 3
Endoscopy Urology & Pelvic Health
Interventional Cardiology(incl. Structural Heart)
Structural Heart
Peripheral Interventions(incl. IM, excl. Spec Pharma)
Cardiac Rhythm
Management
Electrophysiology
Neuromodulation
High end of $700-725M guidance2
$1.4B, +19%, +8%
$1.9B, +9% $1.4B, +15%, +8%
$873M, +13%, +7%
$329M, +7%
$1.9B, +1%
Growth rates listed are operational*, organic*Endo, CRM and EP operational and organic growth rates are equivalent
World Leader in Flexible Endoscopy Devices
• Track record of consistent high performance, outpacing our markets
• Exciting growth business with several market expansion opportunities
• Clear category leadership, deep portfolio, multiple platforms
• Margins and growth rates accretive to BSX
• Targeting $3B+ in revenue by 2025
#1 SHARE POSITION
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 4
Growth Engine for Boston Scientific
MARKET BSX
SIZE GROWTH ‘19-22 est. CAGR REVENUE SHARE POSITIONGROWTH*
(operational)GROWTH*(organic)
~$5B +5% +7% $1.9B #1 +9% +9%
20
19
How Do We Define Endoscopy?
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 5
Biliary Stone and
Stricture Management
Cholangiopancreatoscopy
Esophageal Stricture
Management
Endoscopic Tissue
Resection (EMR/ESD)
Biopsy / Polypectomy
Broad Range of Endoscopy
Procedures & Treatments
Diagnostic / Therapeutic
Endoscopic Ultrasound (EUS)
Airway Obstruction
Asthma: Bronchial
Thermoplasty
Hemostasis
Colonic / Duodenal Stricture
Management
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 6
Single-Use Endoscopes
Infection Prevention
Pathology & Services
Endoluminal Surgery
Surgeon Call Point
Strengthening Category Leadership
Expanding Into High Growth Adjacencies
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 7
LegacyLeadership Businesses
Biliary & GI Therapies
Market Leading Commercial Channel Facilitating Expansion Strategy
SpyGlass™: The Gold Standard Since 2007
EXPANDING SUITE OF ACCESSORIES
2015 2019
SPYGLASS™ CONSUMABLES
IncreasedResolution32.5x
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 8
FIRST AND ONLY Minimally Invasive, Single-Use, Single Operator, Digital Cholangioscope
Compelling Outcomes
& Data
Utilization Accelerating
100,000+ patients,
66+ countries
2500+ consoles placed
Accurate, real-time diagnosis
>95% stone clearance
success rates1
Changes clinical management
in 85% of patients2
Pancreatic Duct
GroundbreakingTechnology
3RD GENERATION SYSTEM
Autolith™Touch Biliary
EHL System
SpyBite™ Max Biopsy
Forceps
SpyGlass™Snare &
Retrieval Basket
SpyGlass™ Discover Digital CatheterA Revolutionary Single-Use Endoscope
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 9
Powerful, credible move into the surgical and percutaneous endoscopy space
Unprecedented access and visualization
of the biliary and pancreatic ductsSolves problems and logistical barriers
Enables interdisciplinary communicationbetween GI, surgeon, and IR
Enables surgical planning, pathology assessment,biliary stone management and anastomosis evaluation
Complements existing GI commercial structure
Dedicated surgical
endoscopy sales force
Establishment of surgicalendoscopy training curriculum
Market acceleration through best
practices in GI medical education
Future surgical applications currently under evaluation
$600M market opportunity today
for transcystic CBDE in EU and US1,2
Exalt™ Model D Single-Use Duodenoscope
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 10
“It is unacceptable that 1 in 20 patients who
undergo a procedure using a duodenoscope may
acquire an infection”
Excerpt from Senator Patty Murray letter
to scope manufacturers, May 2019
Transitioning to a New Paradigm
A Significant Investment to Get It Right
R&D 150+ physicians consulted, 12 animal labs, 200 member development team
Clinical Exalt Dscope 01, 01B, and 02 trials
Commercial Creative integration solutions due to COVID
Exalt™ Model D Single-Use Duodenoscope
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 11
A history of biliary leadership
and successful adoption of
new technology: RX, WallFlex™
and AXIOS™
Proven Commercial Channel
• Ergonomic improvements to drive adoption
• Differentiated features to sustain leadership
• Full suite of customized devices
Commitment to Rapid Portfolio Expansion
• Clinical results, ease of use
• Significant uptick in onboarding accounts
• Hospitals promoting Exalt D to communities
Strong Product Performance
• Effective July 1st . Applicable for single-use endoscopes
such as Exalt D, for Medicare ERCP patients in the
hospital outpatient setting
• Strong society support
Transitional Pass-Through Code Approved
Building a Comprehensive Single-Use Scope PortfolioDesigned to Reduce Infection, Enhance Efficiency, and Improve Availability
EXALT™ Model TG (Therapeutic Gastroscope)800K procedures
SpyGlass™ DS III (Cholangioscope)150K procedures
21SpyGlass™ DS II (Cholangioscope)150K procedures
3LAUNCHED IN 2018
1EXALT™ Model D (Duodenoscope)1.5M ERCPs
2LAUNCHED IN 2019
EXALT™ Model B (Bronchoscope)3M procedures
$2B+ Market1
by 2024
SpyGlass™ Discover (Choledochoscope)40K procedures LAUNCHED IN 2020
©2020 Boston Scientific Corporation or its affiliates. All rights reserved. 12
Reference Slides
Supplemental Non-GAAP Disclosures
14
FY 2019 Divisional Revenue Growth compared to FY 2018 Reported Basis
Less: Impact of
Foreign Currency
Fluctuations
Operational
Basis
Less: Impact
of Recent
Acquisitions /
Divestitures
Organic
Basis
Endoscopy 7.5% (1.7%) 9.2% 0.0% 9.2%
Urology & Pelvic Health 13.4% (1.3%) 14.7% 6.3% 8.4%
MedSurg 10.0% (1.5%) 11.5% 2.7% 8.8%
Cardiac Rhythm Management (0.6%) (1.8%) 1.2% 0.0% 1.2%
Electrophysiology 5.5% (2.0%) 7.5% 0.0% 7.5%
Neuromodulation 12.0% (1.1%) 13.1% 6.3% 6.8%
Rhythm and Neuro 3.3% (1.6%) 4.9% 1.6% 3.3%
Interventional Cardiology 8.7% (2.3%) 11.0% 1.0% 10.0%
Peripheral Interventions 17.3% (1.8%) 19.1% 11.3% 7.8%
Cardiovascular 11.4% (2.1%) 13.5% 4.2% 9.3%
Medical Devices (a) 8.5% (1.7%) 10.2% 2.9% 7.3%
Specialty Pharmaceuticals (b) n/a n/a n/a n/a n/a
Net Sales 9.3% (1.8%) 11.1% 3.8% 7.3%
(a) We have three historical reportable segments comprised of Medical Surgical (MedSurg), Rhythm and Neuro, and Cardiovascular, which
represent an aggregation of our operating segments that generate revenues from the sale of medical devices (Medical Devices). As part of our
acquisition of BTG on August 19, 2019, we acquired an Interventional Medicine business, which is now included in our Peripheral Interventions
operating segment's 2019 revenues from August 19, 2019 through December 31, 2019.
(b) As part of our acquisition of BTG on August 19, 2019, we acquired a specialty pharmaceuticals business (Specialty Pharmaceuticals).
Subsequent to acquisition, Specialty Pharmaceuticals is now a stand-alone operating segment presented alongside our Medical Device reportable
segments. Specialty Pharmaceuticals net sales are substantially U.S. based. Our chief operating decision maker (CODM) reviews financial
information of our globally managed Specialty Pharmaceuticals operating segment at the worldwide level without further disaggregation into
regional results. As such, Specialty Pharmaceuticals net sales are presented globally, and our Medical Devices reportable segments regional
net sales results do not include Specialty Pharmaceuticals.