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How Might BSX’s Delayed LOTUS Edge Impact Its Performance?

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Overview

Boston Scientific (BSX) has announced a delay in the relaunch of Lotus Edge in Europe and in the final PMA (pre-market approval) application submission to the FDA (US Food and Drug Administration) on November 28, 2017. The news triggered a decline in the company’s stock price. But the iShares Edge MSCI Min Vol USA ETF (USMV) rose ~0.36% the same day, and USMV has ~0.40% of its total portfolio in BSX.

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Impact on BSX’s performance going forward

According to Boston Scientific, the delay will have no material impact on the company’s fiscal 4Q17 and 2017 results. However, Wall Street analysts have reduced their forward estimates and updated their financial models. The excessive delay in the relaunch of Lotus devices will impact the company’s sales through 2018 to 2020, which will impact the company’s long-term goals.

After this news, Canaccord Genuity reduced its estimates for 2018, 2019, 2020, and 2021 by $70 million, $114 million, $67 million, and $9 million, respectively, and updated its transcatheter aortic heart valve replacement sales model.

Notably, Edwards Lifesciences (EW) is the leading player in the TAVR (transcatheter aortic valve replacement) market, followed by Medtronic (MDT), which recently launched its Evolut Pro TAVR device.

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