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January 9, 2006

Quick Thoughts on Boston/Guidant Deal
There's much to digest and discuss in an acquisition deal that will change the business of interventional devices in a big way, no matter whether J&J or Boston Scientific winds up with Guidant. But here's just a quick thought, to which I may have a confirmation soon. A big (and newly announced) part of Boston Scientific's deal to buy Guidant is a divestiture of Guidant's vascular intervention and endovascular businesses. This package would be sold to Abbott for $4.3 billion in order to ease FTC approval of the deal in terms of anti-trust issues -- Boston has its own endovascular products that would give it too big a monopoly on the market. (J&J already offered to license its rapid exchange technology to Abbott for the same reason -- Abbott has it coming or going, it seems.) Speed of FTC approval is important to Boston, to give Guidant shareholders the confidence that this deal could be pulled off quickly, especially since J&J's offer has already been cleared by the FTC.

But here's something that I haven't heard discussed in any of the news articles or in the conference call this morning: carotid stents. There are only two currently approved in the United States. Guidant has one: the ACCULINK™ and RX ACCULINK™ Carotid Stent System was approved for use by the FDA back in August 2004. The ACCULINK Carotid Stent System, last I looked, was part of Guidant's endovascular division. And now, a year later, Abbott has the other carotid stent: its Xact® Carotid Stent and Emboshield® Embolic Protection System was approved for use by the FDA on September 15. If Abbott gets Guidant's endovascular products, doesn't that then give Abbott a monopoly on carotid stents? (Boston Scientific has a carotid stent product in the works; J&J has one that's "approvable", but has not gained FDA approval until it resolves some manufacturing concerns.)

Okay, I'm sure wiser heads than mine have a simple answer to this; but I'm just curious as to why the words "carotid stent" haven't been discussed in all of the press flurry today. After all, as Abbott Vascular President Chip Hance said during a recent webcast, if the current CREST and ACT I clinical trials show results, carotid stenting could become a billion dollar a year business in a very short time.

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