Boston Scientific divests Cyberonics stake
This article was originally published in The Gray Sheet
Boston Scientific sells its 13.5% stake in vagus nerve stimulation implant maker Cyberonics for $48.6 million on Oct. 4, the firm reports in a recent filing with the Securities and Exchange Commission. Cyberonics makes the VNS Therapy system for treatment-resistant epilepsy and depression, but has had difficulty securing reimbursement for the latter indication (1"The Gray Sheet" Aug. 27, 2007, In Brief). Boston Scientific, which had been Cyberonics' largest single shareholder, sold all of its 3.57 million Cyberonics shares at $13.60 per share. The move comes as Boston Scientific seeks to divest "non-strategic" assets to cut costs and debt (2"The Gray Sheet" Aug. 20, 2007, In Brief)
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Cyberonics continues to downsize with plans announced Aug. 22 to reduce its workforce by 12%, or approximately 66 of the 547 employees listed in its most recent quarterly SEC filing in July. Cyberonics CEO Dan Moore blames CMS for the cutbacks, saying that the agency's May non-coverage determination for a treatment-resistant depression indication for the firm's VNS Therapy vagus nerve stimulator has reduced sales of the device. Following the non-coverage decision, Cyberonics decided to refocus the VNS business on its epilepsy indication, for which the device was first approved ("1The Gray Sheet" June 18, 2007, p. 12)...
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