April 29, 2014 / 12:30 PM / in 4 years

CORRECTED-UPDATE 2-Boston Scientific says sales of heart rhythm devices fall

(Corrects name of chief executive to “Mike” from “Mark” in paragraph 7)

By Vrinda Manocha

April 29 (Reuters) - Boston Scientific Corp’s quarterly revenue fell short of expectations due to lower sales of its implantable defibrillators and pacemakers, sending its shares down as much as 6 percent.

Sales in the company’s rhythm management business fell 2.5 percent excluding the heart catheter business the company bought from CR Bard Inc last November.

BMO Capital analyst Joanne Wuensch said there were expectations that sales of the company’s implantable cardioverter defibrillators would be higher after the full launch of its subcutaneous ICD in the fourth quarter.

“This was not the quarter that supported those expectations,” she said.

Boston Scientific said it expected subcutaneous ICD sales of over $75 million in 2014.

Heart device makers such as St Jude Medical Inc and Medtronic Inc have reported growing sales of heart rhythm devices in recent quarters after years of low sales in a weak global economy.

Boston Scientific Chief Executive Mike Mahoney said on Tuesday that the market for heart rhythm management devices was “flattish to negative”.

He said the company was facing challenges as its quadripolar defibrillators were not yet on the U.S. market.

The U.S. Food and Drug Administration approved four new heart devices from the company two weeks ago, including two quadripolar defibrillators.

St Jude Medical reported earlier this month a 5 percent increase in sales of ICDs in the United States as it sold more quadripolar defibrillators.

Boston Scientific’s revenue rose about 1 percent to $1.77 billion in the quarter ended March 31, slightly lower than analysts’ average estimate of $1.80 billion.

Revenue from the heart rhythm business rose about 2 percent to $524 million.

Sales of the company’s stents fell about 7 percent to $289 million.

Boston Scientific said its recently launched drug-eluting stent, known as Promius Premier, had become the market leader in the United States.

The company’s net earnings rose to $133 million, or 10 cents per share, compared with a loss of $354 million, or 26 cents per share, a year earlier when it took goodwill impairment, resutructuring and other charges of$578 million.

Excluding items, the company earned 20 cents per share, above the average analyst estimate of 18 cents, according to Thomson Reuters I/B/E/S.

The company raised its full-year adjusted earnings forecast to 77-82 cents per share from 75-80 cents.

The company maintained its full-year earnings forecast of $7.3-$7.5 billion.

Boston Scientific’s shares, which doubled last year on expectations of an improving heart device market, were down about 5 percent at $12.89 in morning trading on the New York Stock Exchange. They fell to $12.77 earlier in the session. (Reporting by Vrinda Manocha in Bangalore; Editing by Don Sebastian)

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