Dear Stockholders:
In 2022, Boston Scientific continued to prove our resilience and winning spirit in an ever-changing world. We saw a year of strong business results and growth despite ongoing macroeconomic headwinds. I am reminded once again that our agility in the face of challenges and uncertainty is no accident. It’s the result of a purposeful, values-driven culture that puts patients at the center of everything we do.
2022 Results
Boston Scientific devices and therapies help physicians diagnose and treat complex cardiovascular, respiratory, digestive, oncological, neurological, and urological diseases and conditions. Our category leadership strategy seeks to deepen our portfolio in these areas through organic research and development, smart investments and acquisitions. We also continue to expand our presence in high-growth markets and regions to make our technologies available to more people who need them.
The announcement of strategic investments in Acotec Scientific Holdings and M.I.Tech Co., Ltd and the acquisitions of Apollo Endosurgery, Inc. and Obsidio, Inc. were an important part of our story in 2022. We completed the acquisition of Obsidio, Inc. in 2022. The Obsidio™ Conformable Embolic is the first and only conformable embolic cleared by the FDA for the embolization of hypervascular tumors in the peripheral vasculature and is expected to further strengthen our interventional oncology and embolization portfolio and accelerate our growth in the highly competitive peripheral embolization market. Our purchase of a majority stake in Acotec was completed in February 2023. Acotec is a leader in innovative medical solutions for treating vascular diseases, including drug-coated balloons, with products and a pipeline that complement our own. We believe this investment will strengthen our presence in China and increase physician and patient access to Acotec products around the world.
Expanding our digital and operational capabilities
Digital transformation in health care has been an industry buzzword for several years now, but the COVID-19 pandemic made it an imperative. In the past two years, we have significantly increased our investment in digital capabilities to improve the productivity of our sales representatives, streamline business processes across sites of care, enable artificial intelligence, provide remote case support, and increase engagement with health care professionals and patients.
Our EDUCARE learning platform now offers on-demand clinical content to approximately 38,000 health care providers around the world. ExpertLink, our portfolio of services that are enabled by remote connectivity technologies, helps us stay connected with health care professionals no matter the circumstances. Through ExpertLink, we offer them case support, training, professional education and technical services for capital equipment. Our Endoscopy and Urology businesses have received excellent customer reviews on a scalable e-commerce platform the businesses launched within ambulatory surgery centers. Additionally, our Peripheral Interventions business continues to see positive customer feedback from its mobile ordering solution, LabAgent. These tools make it easier to do business with Boston Scientific, and we are thrilled with the level of efficiency we have created to date.
As we strengthen the digital infrastructure of our global operations, we are also strengthening our brick-and-mortar infrastructure to face new challenges and meet growing global demand. To increase efficiency in our supply chain, we expanded our facility in Penang, Malaysia, adding a new tier 1 distribution center that will enable us to serve millions of customers and patients and support our growing business across APAC. In Galway, Ireland, we expanded our site capabilities in advanced product design, manufacturing and research and development. As our global footprint gets bigger, we are honoring our commitment to work to cut energy use and convert to renewable energy sources so that we remain on track to achieve carbon neutrality for scopes 1 and 2 carbon emissions at all of our manufacturing and key distribution sites by 2030.
Meaningful Innovation That Solves Urgent Challenges
Boston Scientific innovation is fueled by internal research, collaborations, strategic investments and most importantly, by actively listening to our customers so that we can better address the needs of the patients we serve together.
Working collaboratively with customers helps us understand the clinical challenges they face so that we can design practical and meaningful solutions. Demand for kidney stone care is outpacing the number of qualified urologists available to provide care. To help optimize patient outcomes and procedural efficiency, our Urology team utilized feedback from customers to design our next-generation LithoVue™ Elite Single-Use Digital Flexible Ureteroscope. The device builds on our market-leading LithoVue single-use scope and is the first ureteroscope that can give physicians real-time information about intrarenal pressure. This information may help inform clinical decisions and mitigate potential complications. The device received Health Canada approval in 2022 and was cleared by the U.S. Food and Drug Administration (FDA) in February 2023.
A compelling example is the advances we made in strengthening our products for managing atrial fibrillation (AF), a serious medical condition that affects millions of people and requires treatment to prevent stroke. The WATCHMAN FLX™ Left Atrial Appendage Closure (LAAC) Device is used to treat patients with non-valvular atrial fibrillation (NVAF). The device has been implanted in more than 300,000 patients to date, and in 2022 its net sales crossed the $1 billion mark. Last year we received FDA approval for the expanded labeling of the WATCHMAN FLX device, which provides physicians with the flexibility to include dual anti-platelet therapy as a post-procedural medication option. We also launched the VersaCross Connect™ LAAC Access Solution, which helps increase efficiency during WATCHMAN device implant by eliminating a catheter exchange. This technology could also open new opportunities to address other procedures that require access to the left side of the heart.
We are seeing strong international momentum with our electrophysiology technologies that treat AF, including our POLARx™ Cryoablation System, which has been used in Europe and Japan to treat more than 25,000 patients since launch in 2020 and 2021, respectively. In Europe, clinicians are showing significant interest in our FARAPULSE™ Pulsed Field Ablation (PFA) System, which is clinically validated to reduce the risk of complications associated with conventional thermal ablation procedures. We successfully completed enrollment in June 2022 for an investigational device exemption clinical trial for the FARAPULSE PFA System in the U.S.
Our LUX-Dx™ Insertable Cardiac Monitor System, a long-term diagnostic device that is implanted in patients to detect arrhythmias associated with conditions such as AF, received CE Mark, building on our regulatory approval in the U.S. The device helps provide accurate monitoring data and remote access to programming so physicians can manage patient care more efficiently and confidently.
Addressing Inequities in Workplaces, Communities and Health Care Systems
An inclusive environment that values diverse perspectives is essential to fostering innovation. When we embrace what makes each of us unique, we can achieve the best results for our workplace, community and the patients we aim to serve. Meaningful diversity, equity and inclusion (DE&I) progress is a priority, and we are taking many actions to advance this work:
Improving workforce diversity. We continue to increase representation of women and multicultural talent across the organization as we progress toward our goals to build diversity in leadership. In 2022, women represented 42.6 percent of supervisors and managers globally, and multicultural talent held 22.6 percent of these positions in the U.S. and Puerto Rico.
Providing equitable opportunities for career growth. We are expanding career development and advancement opportunities for all employees, including mentorship, sponsorship and leadership programs for women and multicultural employees. Our leaders complete DE&I training to raise awareness about systemic racism and potential bias, and we have increased our focus on inclusive hiring and equitable promotion practices. We recruit inclusively and with purpose by collaborating with organizations such as Historically Black Colleges and Universities that advocate for the advancement of individuals from underrepresented groups.
Tackling health disparities through our Close the Gap health equity program, we are endeavoring to address systemic and emerging treatment gaps through provider education and collaboration, advocacy and patient awareness. Our goal is to help all patients understand their medical condition and find access to care. We are also working to increase diversity in medical research so that clinical trials — and the researchers who lead them — reflect the patients helped by our technologies, especially people who have been historically underrepresented in medical studies. Our ongoing ELEGANCE global patient registry and post-market study is exploring long-term outcomes of patients treated for peripheral artery disease (PAD) with drug eluting peripheral therapies. PAD disproportionately affects Black men and women, and this study is breaking new ground in diversifying clinical studies by exceeding enrollment targets to include more than 40 percent women and 40 percent underrepresented minorities. The registry is also groundbreaking for the diversity of its principal investigators, more than half of whom identify as women and/or people of color.
Advancing health in global communities. Boston Scientific donated more than $67 million to fund medical research, fellowships and nonprofits around the world. Through our Global Signature Health Grant Programs, we’re collaborating with organizations to train health care workers and conduct chronic disease screenings in vulnerable communities. This work has led to chronic disease diagnosis for thousands of patients.
Reducing our Environmental Impact
Protecting the environment is central to our work because a healthier planet leads to healthier people. We continue to make progress toward our 2030 commitment of carbon neutrality for scopes 1 and 2 carbon emissions at all of our manufacturing and key distribution sites. In 2021, we joined the United Nations Race to Zero and Science Based Targets initiative (SBTi) Business Ambition for 1.5°C campaign. In 2022, SBTi verified our science-based emission reduction targets, which will help guide us on a path toward net-zero carbon emissions across our entire value chain by 2050. This initiative uses climate science to define best practices in emissions reductions with an aim to prevent the worst effects of climate change. We are also pursuing efforts to better manage or reduce waste and increase medical device recycling to minimize the environmental impact of our products and packaging. Through collaborations and partnerships with suppliers and customers, we will continue to work together to advance meaningful change for a healthier planet.
Additional details about our environmental, social and governance (ESG) initiatives will be available in our 2022 ESG performance report. We have much more to do, but we are making strong progress toward our goals and have received several awards for our work. For the third year in a row, we were named to the Dow Jones Sustainability Index — North America, and for the eighth consecutive year, to Fortune’s World’s Most Admired Companies. We are a Human Rights Campaign and Disability Equality Index “best place to work,” and were named by Fast Company as a best workplace for women innovators. It has also been an honor to celebrate our 2022 Catalyst Award, the premier award for DE&I initiatives that improve gender representation across ranks and advance women and other underrepresented groups.
Looking Forward
These accomplishments demonstrate the many ways Boston Scientific is bringing shared value to customers, employees, communities and stockholders. I know the culture we have built will continue to serve us well as we adapt to a rapidly changing health care landscape. I commend our employees for their unwavering winning spirit and commitment to patient care. We will proudly carry Pete Nicholas’ legacy into the future.
On behalf of every team member, I extend our sincere thanks to our Board of Directors for their dedicated service to Boston Scientific, and to you, our stockholders, for your continued support. I am grateful to lead this extraordinary company. Together, we are working to advance science and transform lives.
Sincerely,
Mike Mahoney,
Chairman, President and Chief Executive Officer
March 22, 2023
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