Ladies and gentlemen, thank you for standing by. Welcome to the Boston Scientific Q1 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions) As a reminder, this call is being recorded. I would now like to turn the conference over to our host, Ms. Susie Lisa. Please go ahead.

Thank you, Linda. Good morning, everyone, and thanks for joining us. With me on today's call are Mike Mahoney, President and Chief Executive Officer; and Dan Brennan, Executive Vice President and Chief Financial Officer. We issued a press release earlier this morning announcing our Q1 2014 results, which included reconciliations of the non-GAAP measures used in the release. We have posted a copy of that release as well as reconciliations of the non-GAAP measures used in today's call to the Investor Relations section of our website under the heading, Financial Information. The duration of this morning's call will be approximately one hour. Mike will begin our prepared remarks with an update on our business progress and his perspectives on the quarter. Dan will then review our overall Q1 2014 financial results as well as guidance for full-year 2014 and the second quarter of 2014. During today's Q&A session, Mike and Dan will be joined by our Chief Medical Officers, Dr. Dawkins and Dr. Stein. Before we begin, I'd like to remind everyone that this call contains forward-looking statements within the meaning of federal securities laws, which may be identified by words like anticipate, expect, believe, estimate and other similar words. They include, among other things, statements about our growth and market share; new product approvals and launches; clinical trials; cost savings and growth opportunities; our cash flow and expected use; our financial performance, including sales, margins, earnings and other Q2 and full-year 2014 guidance; as well as our tax rates, R&D spend and other expenses. Actual results may differ materially from those discussed in the forward-looking statements. Factors that may cause such differences include those described in the Risk Factors section of our most recent 10-K and subsequent 10-Qs and 8-Ks filed with the SEC. These statements speak only as of today's date and we disclaim any intention or obligation to update them. At this point, I'll turn it over to Mike for his comments. Mike?

Thank you, Susie, and good morning, everyone. I’ll begin today with some highlights regarding our first quarter performance and then provide some thoughts on our 2014 outlook. Dan will then review the financials and 2014 guidance and then we’ll take your questions. So please note that in my remarks, all references to growth are on a year-over-year basis constant currency unless otherwise specified. So, overall we had a very good first quarter and we’re off to a strong start in 2014. Our plans for the year are to deliver full-year 2014 sales growth in the 3% to 5% range. Importantly, our sales growth will be leveraged to double-digit EPS growth. And we are increasing our full-year 2014 EPS guidance, for which Dan will provide further details. I am pleased that we delivered continued revenue growth in first quarter, along with improved profitability. This represents the fourth straight quarter of operational revenue growth as we continue to build momentum and deliver on our commitments. Our 4% operational revenue growth in first quarter and continued focus on margin improvement helped drive adjusted EPS of $0.20, which exceeded the high-end of our guidance and represents 21% growth. As we continue to execute on our strategic plan, I like to provide several key highlights from the first quarter and discuss key expectations for ‘14. Starting with MedSurg, MedSurg had another excellent quarter. Our MedSurg businesses benefit from the continued high growth in Neuromodulation, as well as strong results in both Urology and Women’s Health and Endoscopy. Within our Cardiovascular group, we are encouraged by the return to operational revenue growth posted by our global Interventional Cardiology team. We look forward to accelerating our IC growth given our strong pipeline and global commercial reach. Our Peripheral Interventions business delivered another quarter of above-market growth, driven…

Thanks Mike. I’ll start with some overall perspective on the quarter before diving into the details. We generated adjusted EPS of $0.20, compared to $0.16 in Q1 of 2013, and ahead of our guidance range of $0.16 to $0.18. Similar to the Q4 results, the improved profitability in Q1 was driven by operational revenue growth and continued gross margin expansion, which was up 260 basis points year-over-year. In addition, this quarter saw lower R&D spend, which was down 80 basis points year-over-year, due to the timing of some projects and a focus on R&D efficiency. These improvements were partially offset by SG&A spend on investments in our strategic growth initiatives and our core product launches. Overall, we posted an adjusted operating margin of 20%, which represents 220 basis points of improvement year-over-year and 140 basis points quarter-over-quarter. We’re encouraged by this level of profitability in Q1 as we remain focused on delivering our goal of 25% adjusted operating margin by 2017, and view these results as a signal that our strategies and programs are working. We believe we remain on track to achieve our profitability goals. Below the operating income line, a $7 million gain on investments and a slightly lower-than-expected effective tax rate, along with a 1% reduction in shares outstanding from a year ago, resulted in adjusted EPS of $0.20 or 21% year-over-year growth. In addition, we generated adjusted free cash flow of $168 million in the quarter and operating cash flow of $198 million. We used $125 million or 63% of that operating cash flow to repurchase approximately 10 million shares in the quarter. While we are pleased with the execution against these goals, particularly with respect to continued operational revenue growth, which we’ve now posted for four straight quarters, as well as improved profitability and a…

Thanks, Dan. Linda, let’s open it up to questions for the next 30 minutes or so.

(Operator Instructions) We have a question from the line of Rick Wise with Stifel. Please go ahead.

Let me start if I could with CRM. Obviously, Mike, you said not what you hoped. And, but during the quarter, since the quarter you continue to roll out all these new products. Do you have what you need in hand now to get this more on a positive growth track in the second half? And maybe, Dan, you could talk about do we return, does the business return to positive growth as we proceed through the year? How do we think about that?

So, overall and if you look at CRM more broadly, we certainly like our full quarter trend that we’ve had in CRM and we’re really pleased how we’ve positioned ourselves from a portfolio perspective going forward and I’ll touch on that in a minute. We are disappointed in the Q1 results. It’s really driven in the U.S. because we had some excellent performance outside the U.S. where we likely gained share in defib outside the U.S. and also at minimum held share globally in pacer. So our challenge really for the quarter only was in the U.S. and we think we were impacted likely. We don’t have a CRT-D device yet in the U.S. and so we’re likely impacted by headwinds in CRT-D and also ongoing replacement challenges that we have in the business, but offset by a de novo -- continued de novo share gain in the U.S. So in the U.S., we particularly are excited about the new launches that we have. So as you saw in the press release and you read, we had a number of really big approvals that will help this business going forward for the long term. We have a new MINI platform which is 15% to -- or 13% to 20% smaller than our competitive devices. We have the approval of our new X4 quad can and we have really been out of the CRT-D game globally for a long time. So, we will not only launch this device including the lead in Europe from now on, but also have the quad can available to launch with competitive lead devices in the U.S. So we think the combination of this in Europe and in the U.S. will clearly provide some enhanced revenue in CRT-D which has been the troubling segment within CRM. So you combine that with our S-ICD device and now our longevity story as well as a device that provides the smallest profile, we think we do have a highly differentiated portfolio and we are positioned to improve our performance moving forward.

And so Rick to follow up, as I said in my prepared comments, I do expect that we would be a net share gainer for the rest of the year based on the portfolio that Mike has just mentioned in terms of S-ICD, the quad system in Europe, the quad can in the U.S. and then MINI in the U.S. and Europe. From a profitability perspective, the good news is that despite going backwards in sales, we still were able to add 140 basis points in operating margin year-over-year, and we’ve been very public about the fact that we have plans in place to do that within the Rhythm Management group without growth and that growth could be upside. So, we are looking forward to the rest of the year relative to sales and obviously very focused on profitability every quarter.

One quick follow-up on the S-ICD, our survey work suggests you have trained roughly half the docs in the U.S., I don't know if that is representative of the larger market. Do you hope to train everybody on the S-ICD this year? And maybe talk a little bit about reorder rates if it is not too soon. Thanks.

Yes, in terms of the training, I’ll turn that question -- that comment over to Ken Stein, Dr. Ken Stein in a second. We did provide guidance in the call today for the first time in terms of revenue projections. We guided towards at minimum $75 million or exceeding $75 million in sales for the full year of S-ICD. So we want to provide that guidance. We’re not going to provide quarterly actual results, but we feel we’re certainly on track to deliver in excess of $75 million for the year. But, Dr. Stein, if you want to comment on the training?

Your order of magnitude right in the rough proportion of cardiac implanting physicians who we’ve trained already. We, again as Mike said during his prepared remarks, we really continue to be fully subscribed in all the training courses that we offer and we are going to continue to train folks on this device through the end of this year and next year.

We have a question from the line of Bob Hopkins with Bank of America. Please go ahead.

So also want to focus a little bit on U.S. ICDs. So if S-ICD was ahead of plan, I am just wondering what specifically in the quarter was worse than you expected on U.S. ICDs. And did pricing change relative to what it has been the last couple quarters? Do you think the market was a little soft? Just wondering if you could give a little bit more color. And as part of that, I am curious as to what percentage of your U.S. ICD sales are CRT-D and how that has been trending?

Overall, again, I’ll answer your question specifically on ICD, we felt it was a very strong quarter comprehensively for BSC with our sales growth on track and also increasing the full-year guidance for the year and double-digit EPS with a broad portfolio. But specific to U.S., again, we are much stronger outside the U.S. in ICDs, but in the U.S. really the two categories continue to be the CRT-D, which we think is a segment and we haven’t broken out the exact percent, but we think it’s a segment that has been growing more quickly and we’ve also been had a headwind in our replacements. And in particular, we offer a leading battery longevity platform. And we think that’s excellent for patients and physicians particularly moving forward in this new environment, but it also does provide us a headwind with our replacement cycle. So, really those two factors have hampered us in the U.S., the CRT-D, which is a segment that is growing and also the headwind that we have with our battery longevity which we think will ultimately be a tailwind for us given the economics of the health care system. Again, we think this will improve with the new launch that we have of our quad-enabled CRT-D device, which we think is very innovative and it will offer physicians and patients the choice. With the quad solution in the U.S., we think it’s clinically differentiated from St. Jude for the reasons discussed earlier. On pricing, we didn’t see anything dramatically different in price, kind of consistent with our fourth quarter. And we also -- we can verify, but we also feel there may have been some larger competitive balking in the quarter, in the first quarter of 2014.

Okay, that is interesting and helpful. I will let others follow up on that. I just want to ask Dan one other quick one. I know the EPS guidance went up by $0.02 relative to your previous guidance. You rattled off a bunch of other categories. Dan, did anything else change in terms of the moving parts of your guidance say on operating margin or tax rate or anything like that? Or is it all consistent with what you said previously?

For which period, Bob?

Sorry, for the full-year 2014.

No, I think for the most part if you go back and look at the full-year guidance ranges for the P&L that we gave at our Q4 call and now they are relatively consistent.

Okay. Anything change though at all?

Nothing. Nothing of any materiality. If you look at the ranges we gave for gross margin and SG&A and R&D and tax rate, they are all very consistent.

We have a question from the line of David Lewis with Morgan Stanley. Please go ahead.

Mike, I appreciate it's a lot of questions on CRM this morning. I guess we sort of looking at the math here in this quarter, your growth rate on a comp adjusted basis into this quarter decelerated virtually identically to your other competitor that has already reported. So I know we are talking about new dynamics in the quarter. Maybe you could sort of talk about in the -- that from a market perspective it does appear that two different providers are down materially fourth quarter to first quarter. So how much of this in your mind is simply market? And if there were sort of pull-through effects in the fourth quarter that we haven't seen here in the first quarter, do you have any sense of how those trends have looked here in the early part of the second quarter?

Yes. We’ll see when Medtronic reports in a few months here, little bit more in the first quarter in terms of the market, but overall in the first quarter, we didn’t see a significant shift really from third quarter, fourth quarter of 2013. Globally, we’re still calling the CRM market kind of flattish to slightly negative. We’ve talked about price being in the kind of negative 3% to negative 5% range globally and really almost essentially offset by volume. So we haven’t seen a significant market change in first quarter. And I think in terms of our performance again, ex-U.S. defib, our business globally performed quite well and we had a number of promising launches and we discussed likeliness and competitive balking as well as some of the headwinds in CRT-D replacement. And some of the new launches that we have we believe will offset some of those trends as we move forward in ‘14. No big market shifts that we saw in the first quarter.

And then, Dan, obviously across your segment reporting here in the first quarter, the biggest relative change obviously was in CRM, which I think those margins almost doubled here in the quarter. As you think about the balance of the year, Dan, and we think about MedSurg and Cardio versus CRM, can you just talk about how you think those general trends -- how much relative improvement can we see in CRM versus some of the other segments and should we assume the majority of the improvement here in 2014 is going to come out of the CRM division versus the other two lines?

And I think just to be clear, you’re talking about a doubling from Q4?

That’s correct.

So looking at Q4 Rhythm Management to Q1, yes, that’s correct, and we had talked about it on our Q4 call some one-time items that were included in Q4. So very pleased with what we saw in Q1 from a Rhythm Management perspective. So just quickly as you go through the three segments, we expect to see the Rhythm Management segment produce more relative to the others because obviously there is more room for that segment to go. But the other segments, both in MedSurg and in Cardiovascular should leverage the growth that’s anticipated in there, and as I mentioned earlier, Rhythm Management, we have plans in place to do that without growth and growth would be upside for that. So, all three will contribute, but I think to your point, Rhythm Management will contribute more overall since it’s coming from such a lower position than the other two.

We have a question from the line of Mike Weinstein with JPMorgan. Please go ahead. Your line is open Mr. Weinstein. Okay. I’m not hearing anyone. I believe we’ll go on to the next. We have a question from the line of Glenn Novarro with RBC Capital Markets. Please go ahead.

I wanted to talk about the stent business which is back on track. In the U.S. you called out Promus PREMIER and it performed very well. I'm wondering if you can call outside the U.S., talk to us about how SYNERGY is launching? A lot of our channel checks suggest SYNERGY is a very differentiated stent and I know it is just getting launched in Europe. But can you give us some feedback in terms of how many countries have been launched, what the pricing dynamic, anything that you can give us that tells us that this differentiated product is going to be a share gainer for you in Europe this year?

Absolutely, Glenn. Overall, we’re really pleased with our performance in Intervention Cardiology and we think we have a lot of room to grow in this one. It’s the first quarter that we’ve grown this segment of our business, which is critical for us given its high profitability in probably four to five years. And we have a lot of room to improve that. Just breaking down on the IC performance quickly, we talk about our IC Other business as well, which is becoming quite meaningful for us in terms of its size from 5%. The DES business globally was down. We had a very strong performance in Europe and we’re challenged a bit more in Japan. And the good news in Japan we expect from a Promus PREMIER launch sometime over the next 90 days, which will really change our trajectory in Japan. So as you look forward with the Japan approval of Promus PREMIER, the momentum that we have in Europe and the -- retaking the number one share position without dramatically changing pricing trends, we like our position. Specifically with SYNERGY in Europe, we continue to follow this kind of three segment strategy in Europe, because we want to establish SYNERGY which we have successfully as a premium product due to its clinical characteristics, and so at future meetings, we will provide more detail in terms of the specific mix of SYNERGY. But we don’t sell it in all markets, we sell it in four to five countries in Europe that can justify a premium pricing. So in those markets, we have a much higher market share of SYNERGY -- much higher mix. In a market that can’t support premium pricing, we don’t even launch SYNERGY. So in those markets, we lead with our Promus PREMIER brand and then we also have a Promus for a low-end product. So we feel like our portfolio is positioned extremely well combined with our complex coronary and imaging business. And those products will be launched in Japan, the PREMIER device as we get into the third quarter and eventually SYNERGY likely the fourth quarter of ‘15 in the U.S. So we think our DES portfolio is uniquely positioned to manage price effectively and to gain share responsibly and complemented with our complex coronary strategy.

And just one quick follow-up. You mentioned Promus PREMIER Japan being launched in 90 days. It is a little bit sooner than we thought. Is that going to be launched also with reimbursement in place?

Yes, we don’t see any issues with the reimbursement with Promus PREMIER in Japan. So the answer is yes.

And we do have a question from the line of Mike Weinstein with JPMorgan. Please go ahead, your line is open.

I apologize, we missed the last few minutes of the call, so if this was asked. But I wanted to ask on two end markets, Mike. One was peripheral vascular and that’s because your performance was so strong this quarter and you have had competitors who have made comments, Bard in particular, that the market has gotten worse, that there has been incremental pricing pressure in particular in Europe and that is where you guys felt the strength. So, could you talk a little bit about that market and your own success there? And then second, I don't know if this was covered in the last minute, but Neuromodulation where we've had this discussion about the impact of the reimbursement change and what that would mean to your business. You seem to suggest that while you expect it to continue to grow above market that the spread between you and the market would narrow over the balance of the year. So could you add a little bit more meat to the bone there? Thanks.

Sure. Thank you. The first one on our peripheral business globally, we grew that 5% ahead of market for a number of quarters in a row. And it’s really not one particular product, we have a very well-balanced portfolio there, very strong commercial team and a nice pipeline. In terms of the market, we haven’t seen a dramatic reduction in pricing in our peripheral business. So there are some pricing challenges there, but we didn’t see a hiccup or a catalyst of price declines in the quarter. And so we continue to see very low single-digit price declines in peripheral, offset by volume, gets us to about 5% growth globally. So, overall, we think it’s a relatively healthy market and that will still pay for innovation. So we like our cover progress in PI globally and we will be launching our drug-eluting balloon in Europe in the future here. Regarding Neuromodulation, this has really been a gem with - or it is a gem with Boston Scientific and we did guide towards slower growth the remaining three quarters. We are confident we’ll continue to gain share. That business has a lot of momentum, a very differentiated platform, but the headwinds you called out one, the reimbursement changes in the outpatient settings and also the anniversary of a launch and very strong comps, plus 20% growth comps that will be entering the second quarter. So we didn’t provide guidance as to what our growth would be in the second, third and fourth quarter, but it will be slower, it will taper from what it has been the last four quarters, really driven by both of those factors, but we still believe it will be a healthy contributor to the top line and faster to market.

One last follow-up. Dan, on the 140 basis points of margin expansion in the CRM business this quarter which you (indiscernible) what you guys thought. How much of that came from R&D reduction versus gross margin expansion or SG&A reduction, do you have that?

Yes. I think the majority of it would -- more of it would come from gross margin than would come specifically from R&D. But the point is, it’s really - it’s all throughout the P&L. It won’t be just one area of the P&L that will drive the improvements that we’re going to make in that segment. All will contribute, but the gross margin should be the largest contributor of the line items.

And overall the R&D, you saw this quarter for the company as a whole, do you expect that to balance out over the balance of the year to be less of a driver of the earnings growth?

Yes. That’s fair Mike. So I think we were sub-11% for the quarter in R&D as a percentage of sales in Q1 and we’ve guided for a 11.5% to 12% for Q2. So there is a little bit of timing. We still expect probably to be driving some efficiencies in R&D but there is some timing in Q1 that will come back in Qs two, three and four exactly.

We have a question from the line of Josh Jennings with Cowen and Company. Please go ahead.

Just first I wanted to go back to the drug-eluting stent franchise in the U.S. and returning to growth mid-30s share. Can you just talk about the sustainability there, is there upside in terms of share gains from here versus some of the potential trialing that your competitors have called out?

Yes. So one is, we’re pleased that we’ve kind of recaptured the number one share position. We’re also very sensitive to the pricing in this marketplace. So this is not a hold a number one share position at all cost position. We think we have a stronger portfolio and we can maintain price discipline and increase our market share with our portfolio. So if you look at the, one, we’ve got a very strong commercial team. We have capabilities with our chronic total occlusion and imaging business that physicians are interested in that helped complement our DES portfolio. And we think, as you look for the future here, with our Promus PREMIER launch, which really is in full launch mode now and call it 18 months from now, potential launch of SYNERGY in fourth quarter ‘15 that we really are well positioned to have a - we’re planning on a increasing gap in terms of our leadership in the U.S. with our portfolio.

Great, and just one follow-up on the CRM side. Just with -- in terms of your high-voltage lead strategies with the recent announcement of U.S. ID for 7-French lines 4-FRONT, how are you thinking about building out that portfolio and any timelines in terms of when that lead could be approved?

So, this question regarding the new lead in the U.S.?

Yes.

So specifically around the new ICD, that’s an 8-French lead, not 7. And that is being investigated as part of our NAVIGATE clinical trial, which is enrolling patients both to investigate our family of quad pole CRT-D leads, the ACUITY X-4 leads as well as the 4-FRONT device and that trial launched a little bit earlier this quarter and expect to complete enrolment in that trial around the end of next year.

We have a question from the line of Bruce Nudell with Credit Suisse. Please go ahead.

Mike, just looking at the dynamics around the S-ICD. In one sense it’s very positive in that you are expecting over 1% worldwide market share on a revenue basis. But just looking more granularly at the US, it looks like the MRG data says you are about 2 points under-represented in can share in the CRT-D segment relative to the overall share, but 5 points over-represented in the single chamber share. And so, is one of the moderating influences regarding the impact of S-ICD on overall share that people will just keep your single chamber share about the same but give you more representation in S-ICD, with a revenue uptick of course. But that’s like kind of this share allocation strategy that these hospitals may have, if you could just comment on that?

Well, I think physicians and patients ultimately like to think we will choose the best product for the best patient. And we think that’s what’s driving our de novo share gains, which really is the hallmark of which platforms are most innovative. I think the new implants are being selected and we are being selected at an increasing rate because of our S-ICD capability. And we think we have a lot of momentum. We believe we’ll gain a lot of momentum with this new MINI platform, which provides the thinnest device. So the notion of a physician rewarding us for that and then maybe hurting us or de-tracking us in CRT-D as a result of that gain, I don’t think that’s a big play. I think the fact we’ve had some portfolio gaps, we haven’t had a CRT-D device, which is the premium priced product in the segment, we haven’t had one and now we have it in Europe and we’re able to provide a solution now in the U.S. and although it’s not a solution, we’re are offering the quad pole lead as well, we believe a number of physicians will mix and leverage our X4 can capability in CRT-D procedures. So there is a lot of service components embedded within the CRM business but we think ultimately a leading that’s innovative will win and we are building that over time.

And on a strategic basis, one of the things that’s really kind of surprised me is the strength of TAVI results generally where it’s proving superior to surgery in elderly, higher-risk patients. And that has connotations for its ultimate market size. And I think the skeptics of the market were pegging it more in the $2 billion range, the optimists were $3 billion. But it looks like there could be even upside to that. Have these results made you sit back a little bit and really think about the level of investment that Boston should be appropriating towards structural heart generally, especially given success -- early success at least in the mitral front?

Yes. Well, I’ll turn that over to Dr. Keith Dawkins.

Bruce, I think we remain very bullish about the segment, particularly after the favorable superior ACC results recently presented. As you know, Lotus is a differentiated second-generation product and as you also know peri valve elite drives both early and late mortality and morbidity. We think the leak results from REPRISE II the CE Mark trial best-in-class and the six-month data from the REPRISE II will be presented next month at EuroPCR. So this is an area where we are investing heavily. The additional third valve size, the 25 millimeter valve, will be launched shortly and will be available for the REPRISE III U.S. pivotal IDE trial. So in answer to your question, we appreciate the increasing potential size of the market and are investing appropriately in this space.

And we have a question from the line of Matthew Dodds with Citigroup. Please go ahead.

For BP, it looks like the Bard business, I know you talked about the legacy business declining, but I think the Bard business declined 10% as well, is that right and is that integration issues?

We have to get that exact number to you. The standalone Bard business declining 10% doesn’t appear correct to me. So we will to verify with the group here. So our information was saying that the Bard integration has gone well, that the revenue gains are consistent with our financial model and more in the flattish range year-over- very. Quite frankly, the challenge has been more in the legacy EP business within Boston Scientific, which ex-Bard, was down slightly for the quarter. So I would tell the Bard business more flat and the legacy BSC business is low single digits. So I think overall that integration has gone well. As I mentioned the commercial teams have pulled together and we’re really still in the very important time where we are pulling the key pieces there together. We’ve talked about our IntellaTip MiFi therapeutic catheter, we’ll gain an impact as we move towards the second half of the year. And we will have our first implementations of our Rhythmia navigation system. So that business will strengthen particularly in the second half of 2014 and be a more meaningful contributor in ‘15.

Just a quick one on emerging markets, if that’s all right. You did better than peers this quarter. It sounds like in the commentary, Endoscopy, Urology, Other Interventional Cardiology were the big strengths, is that - are those the majority of it, or is there something I missed that also did really well?

We are putting increased emphasis on the diversification of our portfolio in the business you just mentioned in those emerging markets. There is less pricing pressure, there is excellent opportunity to train more physicians and to increase access and the three that you mentioned there are growing quite nicely. And so it’s helping diversify our cardiovascular mix in those markets.

We have a question from the line of Brooks West with Piper Jaffray. Please go ahead.

Mike, I wanted to push you a little bit on the strategy with your quad generator in the United States, just to make sure I'm thinking about expectations correctly. Do you see that -- is there an opportunity to call on competitive accounts in your mind with that generator and actually try to take some share based on the differentiated features? Or is it primarily a protector for Boston Scientific labs against potential -- you know, you've got St. Jude and you've got Medtronic coming to the market in the near future.

I think it’s both. We haven’t offered, there hasn’t been a competitive quad offering in the U.S. And physicians like -- in most hospitals like choices. So I think it will be - we’ll target that customers who are users of BSC products broadly and customers who may not be users of BSC products, so I think it’s great for the market to have a second offering. And this strategy has been really well proven out. There has been a number of cases in the past where even recently that we’ve seen some competitive companies have some lead issues and you see companies or physicians that will mix and match say our leads with competitive devices or our device with competitive leads. So that is not a new phenomena within this business and it’s been approved through rigorous testing and clinical performance by the FDA and I think the market will embrace a second choice in the quad offering and we will take it immediately to competitive accounts and to our current users.

Okay. And then just a quick follow-up on other Interventional Cardiology, can you call out, is that mainly your imaging products and then remind us again your pipeline there? Don't you also have an FFR product coming to market soon?

Sure. The key drivers of our IC Other business would be our imaging business, our IVUS imaging business for sure and we’ll be expanding into FFRs. I think -- I believe the first quarter of 2015 is the timing for our FFR launch, so that’s a nice catalyst. The second one is our chronic total occlusion, which is the acquisition we did at BridgePoint a number of years ago, a couple of years ago and also we had a positive ruling legally and we’ll be able to re-launch our Guidezilla guide catheter as we enter our second quarter here. So that should provide some additional tailwind to the Other Cardio business.

Linda, we have time to take one more question please.

Okay, thank you. We have a question from the line of Kristen Stewart with Deutsche Bank. Please go ahead.

Just wanted to double check I guess your guidance for the full year including about 100 basis points plus from adjacencies, just in terms of whether or not -- I know that is what you said from last quarter as well but your confidence around that given what seems to be still a very slow progress on Alair and then the change in assumptions with Vessex. Then I have a follow-up after that.

Christian, it’s Dan. Yes, I think as we called out in the prepared comments, the three biggest contributors to that 100 basis point, 100-plus basis points of growth will be Lotus, WATCHMAN and Alair, and that’s still the plan and still that’s included in our $7.3 billion to $7.5 billion guidance for the year.

And then just on the margin front, you guys have commented that you still feel very confident in getting to the 25% operating margin goal in 2017. This quarter you saw a lower tax rate. It sounds like you didn't really change the tax rate guidance for the full year. But can you give us some level of appreciation in terms of the longer term if you can get to the 25% operating margin goal in 2017? What does the tax rate look like in that year?

So I think we’ve gone out both this year and next year with 13% to 15%. I’m very comfortable with that in terms of tax rate and actually we don’t really give much guidance for ‘15, but we feel like the tax rate is an important one to give for that next year. Still feel good about the 25% operating income in 2017 and that would include whatever tax rate we’re at at that point as well.

What’s the risk I guess that that nice improvement in operating margin over the next several years is really offset by a significantly higher tax rate?

I think if you look at the -- our comfort with the 25%, again, I wouldn’t give anything beyond 2015 relative to any parts of the P&L, but still feel that the 25% is our goal for 2017 with all areas of the P&L contributing.

Okay. With that, we’d like to conclude the call. Thanks for joining us today. We appreciate your interest in Boston Scientific. And before you disconnect, Linda will give you all the pertinent details for the replay. Thanks again.

Thank you. Ladies and gentlemen, this conference will be available for replay after 10:30 AM Eastern time today until May 13th at midnight. You may access the AT&T Executive Playback Service at any time by dialing 1-800-475-6701 and entering the access code 322688. International participants may dial 1- 320-365-3844. Again those numbers are 1-800-475-6701 or 1- 320-365-3844 and the access code 322688. That does conclude our conference for today. Thank you for your participation and using AT&T Executive Teleconference Service. You may now disconnect.