Zacks_Analysts' Blog : FDA-Boston Scientific to Work on Mesh - Analyst Blog

Leading medical devices player, Boston Scientific Corporation (BSX) issued a statement following its recent meeting with the Food and Drug Administration (FDA) Obstetrics & Gynecology Devices Advisory Committee. The meeting was significant as safety, effectiveness and class II status of its surgical mesh (to repair pelvic organ prolapse or POP and stress urinary incontinence or SUI) were debated.

The panel came to the conclusion that more clinical studies and stringent regulation of surgical mesh, manufactured also by Johnson & Johnson (JNJ) for the treatment of POP and SUI are needed. Boston Scientific will continue to work with the FDA in this respect.

In July 2011, the FDA provided an update on the use of the urogynecological surgical mesh to repair POP and/or SUI. The FDA issued the update to inform patients and healthcare providers that serious complications associated with surgical mesh for transvaginal repair of POP are not rare.

The agency also believes that there is no sufficient clinical evidence to prove that transvaginal POP repair with mesh is more effective than traditional non-mesh repair. The use of mesh introduces additional complications. In this backdrop, the FDA held the advisory meeting in September to discuss their findings with outside experts.

Boston Scientific’s Urology/Women’s Health business develops and manufactures devices to treat various urological and gynecological disorders.  Revenues in the most recent quarter increased 6% (up 3% at CER) to $127 million with $87 million from Urology (up 9% or 6% at CER) and $40 million in the Women’s Health (unchanged or down 3% at CER).

The Women’s Health business suffered from market decline, slowdown in elective procedures and competitive trialing of new products in the Pelvic Floor business, partially offset by strong acceptance of the new Genesys Hydro ThermAblator (HTA) system.

Internationally, Urology/Women's Health experienced double-digit growth (in 3 out of 4 regions) driven by new product introductions and new therapies gaining popularity in the markets outside the US. The recent challenges regarding the surgical mesh might hamper this segment in the forthcoming period.

We currently have an Outperform recommendation on Boston Scientific.