Boston Scientific Corporation

Good morning and welcome to the Boston Scientific fourth quarter 2024 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to John Monson, Senior Vice President, Investor Relations. Please go ahead.

Thank you, Drew, and thanks everyone for joining us. With me today are Mike Mahoney, Chairman and Chief Executive Officer, and Dan Brennan, Executive Vice President and Chief Financial Officer. During the Q&A session, Mike and Dan will be joined by our Chief Medical Officer, Dr. Ken Stein. We issued a press release earlier this morning announcing our Q4 and full year 2024 results, which included reconciliations of the non-GAAP measures used in this release. The release, as well as reconciliations of the non-GAAP measures used in today's call, can be found on the investor relations section of our website. Please note that on the call, operational revenue excludes the impact of foreign currency fluctuations, and organic revenue further excludes acquisitions and divestitures Guidance excludes the previously announced agreements to acquire Bolt Medical and Interra Oncology, which are expected to close in the first half of 2025, subject to customary closing conditions. For more information, please refer to the Q4 Financial and Operational Highlights deck, which may be found on the Investor Relations section of our website. On this call, all references to sales and revenue are organic, and relative growth is compared to the same quarter of the prior year, unless otherwise specified. This call contains forward-looking statements regarding, among other things, our financial performance, business plans, and product performance and development. These statements are based on our current beliefs using information available to us as of today's date and are not intended to be guarantees of future events or performance. If our underlying assumptions turn out to be incorrect or certain risks or uncertainties materialize, actual results could vary materially from those projected by the forward-looking statements. and other filings with the SEC, including the risk factor section of our most recent annual report on Form 10-K. Lawson Scientific disclaims any intention or obligation to update these forward-looking statements except as required by law. At this point, I'll turn the call over to Mike. Great.

Well done, John. Thank you, everyone, for joining us today. In 2024, we had an excellent performance across the board, surpassing our financial goals that we set for the year. This outstanding and differentiated performance is fueled by innovation, great execution across our global business units and the earlier than expected approval and adoption of FerroPulse in the U.S. In fourth quarter 24, company operational sales grew 23% and organic sales grew 20%, exceeding the high end of our guidance range of 14 to 16. Full year 24 operational sales grew 18.5%, while organic sales grew 16% for the year, exceeding our guidance of approximately 15%. We believe that most of our global business units grew in line or faster than their respective markets in 24, which is a testament to our broad, diversified product portfolio and the winning spirit of our global teams. Fourth quarter adjusted EPS of 70 cents grew 26%, which exceeded the high end of guidance range of 64 to 66 cents. Full year adjusted EPS of $2.51 grew 22%, also exceeding the high end range of our guidance 245 to 247. For the year, we drove 70 basis points of adjusted operating margin to 27%, representing a balance of margin drop through on the revenue upside we saw throughout the year, along with a reinvestment back into the business to drive long term differentiated growth. For our 25 outlook, we expect our differentiated financial performance to continue. fueled by our innovative portfolio and strong global execution, and we're guiding to organic growth of 14% to 16% for the first quarter of 25, and 10% to 12% for the full year. Our first quarter 25 adjusted EPS guide is $0.66 to $0.68, and we expect our full year adjusted EPS to be $2.80 to $2.87, representing growth of 12% to 14%. Dan will provide more details on the financials And I'll provide some additional highlights in 24. So regionally and operational basis, the U.S. grew 31% in the fourth quarter. Full year 2024 was 21%, with double-digit growth in six of our eight business units. On an operational basis, Europe, Middle East, and Africa grew 12% in the fourth quarter and 14% on the full year. In 24, we saw above-market growth from all business units supported by strong commercial execution, talking about Europe here, and key franchises across the portfolio, as well as price discipline. We expect to outpace the market again in 25, with further momentum in EP, following the recent approval of Fairwave Nav, and increasing contribution from our growth in merchant markets. In Asia-Pac, we grew 12% operationally in fourth quarter, and 16% for the full year, led by excellent performance and double-digit growth across Japan, China, Australia, and New Zealand. Japan really had a nice year, growing double digits for the second year in a row, driven by age in DCB, resumed Watchman Flex Pro, and very early contribution from Parapulse. On a full year basis, China grew strong double digits and crossed $1 million in revenue. This differentiated growth in China was fueled by a broad portfolio, focus on innovation, and excellent commercial execution. Looking ahead, we expect China to grow mid-teens with increasing contribution from Parapulse in our diverse portfolio, despite the ongoing VBP pricing pressures in the region. I'll now provide some additional commentary on our businesses, starting with urology, which grew 8% in fourth quarter and 9% for the full year, and an operational basis grew 20% in fourth quarter and 13% for the full year, following the November close of Exxonix. Full-year organic growth is fueled by prosthetic urology and stone management, where we had key launches with the Tenacio pump for the AMS 700, and continued success with our expanding lift-of-view portfolio. Prostate health also performed well in 24 with double-digit growth in Resume, as well as strong performance in Spacer. We're pleased to have enrolled our first patient in the HydroSpace trial, evaluating the safety net efficacy of our Spacer hydrogel. In 25, we expect to see continued strong above-market growth for urology and look forward to further integrating the highly complementary Axonix technologies into our portfolio. Endoscopy sales grew 8% operationally and 7% in fourth quarter organically on a full-year basis, grew 9% operationally and 8% organically. Full-year growth was led by double-digit growth in our endoluminal surgery and single-use imaging franchises, along with sustained growth of our Axios platform, where we're investing to drive expanded indications and most recently receiving approval in Japan for Axios for gallbladder drainage. Within endoluminal surgery, we continue to see positive reimbursement wins for our ESG weight loss procedure, with a recent Category 1 CPT code announced, and now IFSO, an international bariatric committee, endorsing ESG with guideline updates. Neuromodulation sales grew 12% operationally and 5% organic in Q4, and on a full year basis grew 14% operationally and 3% organically. Our brain franchise grew mid-single digits in both the quarter and on a full-year basis, and our pain franchise grew mid-single digits in the quarter and low single digits for the year. Within deep brain stimulation, we expect improving growth in 2025 with the recent FDA and CE mark approvals of our unique CartesiaX and HX leads, the first and only 16 contact directional leads that deliver precise personalized therapy. We also expect higher growth in our pain franchise in 25, driven by continued strong momentum at Intercept and the recently released data supporting safety, effectiveness, and durability through five years now. Cardiology delivered an exceptional quarter and year, with sales growing 32% in fourth quarter and 25% for the full year. Within cardiology, interventional cardiology therapies, sales grew 10% in fourth quarter and 11% for the full year. And on a full year basis, the coronary therapies franchise growth is driven by strong global performance in our imaging and complex PCI franchises, and earlier momentum with the U.S. launch of Agent DCB, which now has additional reimbursement in the outpatient setting. In addition, we recently announced our agreement to acquire Bolt Medical, an intravascular lithotripsy platform for treatment of coronary and peripheral artery disease. Bolt's IVL technology is highly synergistic with our existing suite of devices in complex PCI, imaging, and drug looting portfolios in both ICTX and PI. And we're excited to close the Bolt acquisition, which we expect to do so in the first half of this year. Our structural hard valves franchise grew double digits for the full year and low single digits in fourth quarter. During fourth quarter, we launched our next generation accurate prime valve in Europe, which features frame enhancements, a simplified deployment mechanism, and includes a larger valve size. Watchman sales grew 20% in fourth quarter and 19% on a full year basis. U.S. fourth quarter growth of 20% was bolstered by an increase in concomitant procedures enabled by the new DRG, which became effective in October, and positive data from our option trial demonstrating a similar stroke risk reduction with superior bleed risk reduction versus OACs in high-risk patients following AF ablations. These positive outcomes from option were reaffirmed by data in the concomitant subset of patients, which was recently presented at the AF symposium. We're pleased with the performance of our Watchman business in 2024 and expect this market to continue to grow approximately 20% driven by concomitant procedures, ongoing clinical evidence, and our initiatives to drive patient awareness and physician training. Cardiac rhythm management sales grew 3% in the quarter and on a full year basis. Our diagnostics franchise grew double digits on a full year basis in outpatient market growth, driven by our implantable cardiac monitors with early contribution from our LUX DX2 launch in Europe. In core CRM in both fourth quarter and on a full year basis, both our high-end and low-voltage business grew low single digits. And as we look ahead, we're excited to bring our empowered leadless pacemaker and modular CM system to market in 25, likely in the second half of the year. Electrophysiology sales grew 172% in the fourth quarter and 139% on a full-year basis. FerriPulse has continued to lead the transformation of the AFib market, surpassing $1 billion in revenue in 2024 globally, with over 200,000 patients treated. We expect the AF market to continue to rapidly convert to PFA in 2025 and beyond, driven by FerriPulse. Exceptional fourth quarter sales performance was driven by air pulse uptake in the U.S. and Europe as a result of very strong safety profile, ease of use, and procedural efficiency, as well as our launches in both Japan and China. Initial feedback on our integrated system of fair wave nav on our OPAL mapping system, which we launched during the fourth quarter in the U.S., has been very positive. We expect to continue to enhance our capabilities in this segment of the market, including with a recently closed acquisition of Cortex, an advanced AF mapping solution. We continue to build a best-in-class compendium of clinical evidence, including the recent results of Phase I of the ADVANTAGE AF trial, with data demonstrating positive outcomes using FerroPulse in persistent AF patients, meeting the primary endpoint for efficacy and safety, with zero instances of stroke, pulmonary vein stenosis, esophageal injury, or major access complications. We expect an updated label for persistent AF in the second half of the year. In the coming weeks, we expect to complete the enrollment of Avant-Garde, evaluating the safety and efficacy of FerriPulse as a first-line treatment for persistent AF compared to antiarrhythmic drug therapy. Additionally, we anticipate data to be presented in the first half of this year from Phase 2 of the Advantage AF trial, evaluating FerriPoint, which is our point-by-point PFA ablation catheter, which is expected to support U.S. FDA approval by year-end 2025. Turning to peripheral interventions, fourth quarter sales grew 22% operationally and 12% organically on a full year basis, grew 15% operationally and 11% organic. Our interventional oncology and embolization franchise excelled again in Q4 with double-digit growth across the entire product portfolio and growing mid-teens for the full year. Expanding clinical evidence for new indications continues to be a focus area. We're pleased to have completed an enrollment in the first phase of the Frontier trial. is an early feasibility study for the use of therosphere to treat recurrent glioblastoma additionally we look forward to closing our acquisition of intera expect in the first half of 2025 which will broaden our interventional oncology offerings to patients with liver cancer within our vascular franchise on a full year basis we saw high single-digit arterial performance led by double-digit growth in our drug-loving portfolio and mid-single-digit venous growth led by Garethina, and our clot management portfolio. On a standalone basis, the Silk Road business grew double digits for the full year, and we're pleased to recently share the 30-day results from the Roadster 3 study, which demonstrated the safety and effectiveness of TCAR for patients with standard surgical risk. So in closing, I'm very proud of our global team and what we were able to accomplish in 2024, resulting in full-year organic growth of 16, adjusted EPS growth of 22. We're very excited about the future of Boston Scientific and remain focused on our talents while enhancing our culture that is relentless in driving differentiated results. With that, I'll pass it off to Dan to provide more details on the financials.