Devices & Diagnostics

Medical device tax suspension leads Boston Scientific to continue partnership with Mayo Clinic

Thus far, the company has paid about 1 percent of its revenue ($75 million out of $7.4 billion) under the medical device tax. Due to the tax reprieve, Boston Scientific is now putting that money toward research.

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The two-year suspension of the medical device tax has led Boston Scientific to put more money into its partnership with Mayo Clinic to start human testing on two new medical devices designed to help cardiovascular patients.

Boston Scientific has led the industry’s lobby against the 2.3 percent tax on U.S. revenues of medical device companies, which was levied in 2013 to help fund the Affordable Care Act.

Thus far, the company has paid about 1 percent of its revenue ($75 million out of $7.4 billion) under the tax. Due to the tax reprieve, Boston Scientific is now putting that money toward research.

For example, engineers from Boston Scientific are working with physicians at Mayo Clinic, talking to doctors about the biggest unmet needs that new devices might be able to address. With the aim of developing new products, the company and the clinic are sharing intellectual property.

Although an exact amount wasn’t disclosed, Kevin Ballinger, senior VP at Boston Scientific who heads its interventional cardiology business, told Boston Business Journal that it is a “multimillion-dollar investment” that involves many of the “hundreds” of its engineers based in the Twin Cities across four different divisions.

“The suspension of the medical device tax allowed us to double the amount of money and resources we were able to put toward this collaboration with the Mayo Clinic. That’s both in terms of head count and in terms of dollars,” Ballinger said.

As far as what the device development involves:

One is for a device that helps doctors guide a catheter to treat aortic-valve stenosis, a common problem in the elderly. The procedure often takes up to 20 minutes, he said, as patients are exposed to radiation and chemical dye agents; the new device allows it to be done in a minute or less. The feasibility trial of the device will enroll around 20 patients.

The other project is testing a new use for an existing product, the Precision Spectra Spinal Cord Stimulator, used to treat lower-back and leg pain. The product will be tested in at least 10 — and as many as 40 — heart failure patients to block signals in the spinal cord that trigger shortness of breath and muscle fatigue during exercise. Mayo Clinic researchers have found that the symptoms are caused by the brain over-interpreting the signals, and Pennington said drugs are usually used to control it. The stimulator would replace drugs in the patients so they can exercise without their blood pressure skyrocketing.

Photo: Flickr user Wirawat Lian-udom

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