Boston Scientific

Since its origin in the late 1960s, Boston Scientific's mission has been to improve the quality of patient care and the productivity of healthcare delivery through the development and advocacy of less invasive medical devices and procedures. This is accomplished through the continuing refinement of existing products and procedures and the investigation and development of new technologies which can reduce risk, trauma, cost, procedure time, and the need for aftercare. Key Dates: Medi-Tech Inc., partially owned by John Abele, introduces its first products, a family of steerable catheters. Boston Scientific is founded by John Abele and Peter Nicholas for the purpose of acquiring Medi-Tech, Inc. Boston Scientific begins a string of acquisitions that will raise revenue to $2.84 billion in 1999. Boston Scientific Corporation is a pioneer in providing medical devices for less invasive surgical procedures. As improvements in medical imaging made such procedures more practical, the company established itself as a leader in coronary stents and stent systems. After going public in 1992 the company grew tremendously through acquisitions, with revenue reaching $2.84 billion in 1999. Toward the end of the decade, however, the company began experiencing such problems as product recalls and a financial scandal that caused its stock to fall out of favor with Wall Street. Boston Scientific Corporation was founded in 1979 by John Abele and Peter Nicholas, who met while watching their children play soccer. Nicholas, a Wharton M.B.A., had worked for pharmaceutical company Ely Lilly & Co. since 1968. Nicholas was mainly interested in management; Abele was more technically oriented. He had majored in philosophy and physics at Amherst and had been employed selling medical devices for Advanced Instruments, Inc. In 1968 Abele met Itzak Bentov, inventor of a steerable catheter that was used in less invasive surgical procedures. With financial backing from Cooper Laboratories, Abele began marketing the device through Medi-Tech, Inc., a company in which Abele had acquired an equity interest. In 1969 Medi-Tech introduced its first products, a family of steerable catheters that were used in some of the first less invasive procedures. In its first year Boston Scientific reported revenues of about $2 million. Its first products included catheters for gall bladder surgery. The early 1980s marked a period of active marketing, new product development, and organizational growth. The company focused on catheters and other products that could be used as alternatives to traditional surgery. As medical imaging techniques improved, less invasive procedures became more feasible. The catheters allowed doctors to perform surgical procedures through little incisions. Such procedures were also much less expensive. The company soon expanded its line of catheter-based devices to include heart, vascular, respiratory, gastrointestinal, and urological applications. The company had four operating divisions: Medi-Tech, which specialized in radiology; Mansfield, for cardiology; Microvasive Endoscopy for gastroenterology; and Microvasive Urology. Boston Scientific would typically introduce a device for use in less critical places, such as the urinary tract, then apply it to higher-risk situations, such as those in cardiology. This helped speed up development of new products. The company posted 40 percent revenue growth for the first half of 1992, while earnings for the same period grew by 28 percent compared to the same period in 1991. For the year, Boston Scientific had revenue of $315 million. In the latter half of the 1990s, trends supporting demand for medical devices included political pressures to develop new cost-effective technology; demand for fast, effective, and safe procedures; and a broad international market. The FDA responded to pressure reduce its review time for certain types of new devices to 90 to 120 days instead of 18 months or more. Boston Scientific's