Boston Scientific Plans to Boost Presence in China

Boston Scientific Corp. is looking to fill in domestic sales gaps with expansion in China.

The company has faced stiff head winds lately with sluggish sales, top-level executive turnover and the new federal medical device tax.
Though the company has seen its stock more than double in the past year with the approval of new products, it announced in October it would eliminate 1,100 to 1,500 positions worldwide (6 percent of its total workforce) through layoffs and attrition.

According to the Wall Street Journal, the company plans to boost headcount in China from 400 to 500 in 2014. At the same time, it plans to increase revenues 30 percent a year for the next five years through products aimed to help the rising levels of heart failure, strokes and gastrointestinal problems in the country.

The emerging market is hoped to bolster Boston Scientific’s profits in the United States and Europe, which are improving but continue to be in the red. For the company’s third quarter, it reported a net loss of $5 million, better than a year earlier when it lost $664 million.

In late October, analysts at Leerink Swann said investors were “disappointed with the lack of meaningful sales growth acceleration expected in 4Q given BSX’s 2-4 percent operational growth guidance,” and were also surprised by CFO Jeff Capello’s decision to leave as the company appears to be on its way toward a turnaround.