Good morning and welcome to the Boston Scientific Third Quarter 2024 Earnings Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Jon Monson, Senior Vice President, Investor Relations. Please go ahead.

Thanks, Drew, and thanks everyone for joining us. With me today are Mike Mahoney, Chairman and Chief Executive Officer; and Dan Brennan, Executive Vice President and Chief Financial Officer. During the Q&A session, Mike and Dan will be joined by our Chief Medical Officer, Dr. Ken Stein, and Art Butcher, President of our MedSurg and Asia Pacific businesses. We issued a press release earlier this morning announcing our Q3 results, which included reconciliations of the non-GAAP measures used in this release. The release as well as reconciliations of the non-GAAP measures used in today's call can be found on the Investor Relations section of our website. Please note, on the call, operational revenue excludes the impact of foreign currency fluctuations, and organic revenue further excludes acquisitions and divestitures for which there are less than a full period of comparable net sales. Guidance excludes the previously-announced agreement to acquire Axonics, which is expected to close in the fourth quarter of 2024, subject to customary closing conditions. For more information, please refer to the Q3 financial and operational highlights deck, which may be found on the Investor Relations section of our website. On this call, all references to sales and revenue are organic, and relative growth is compared to the same quarter of the prior year, unless otherwise specified. This call contains forward-looking statements regarding, among other things, our financial performance, business plans and product performance and development. These statements are based on our current beliefs using information available to us as of today's date and are not intended to be guarantees of future events or performance. If our underlying assumptions turn out to be incorrect or certain risks or uncertainties materialize, actual results could vary from those projected by the forward-looking statements. Factors that may cause such differences are discussed in our periodic reports and other filings with the SEC, including the Risk Factors section of our most recent annual report on Form 10-K. Boston Scientific disclaims any intention or obligation to update these forward-looking statements, except as required by law. At this point, I'll turn it over to Mike.

Thanks, John. Thank you, everyone, for joining us today. Our Q3 results exceeded our expectations and we continue to invest in our portfolio and capabilities to deliver differentiated performance over the long-term. In Q3 '24, total company operational sales grew 19% and organic sales grew 18%, exceeding the high end of our guidance range of 13% to 15%. Our excellent growth is and will continue to be focused on our category leadership strategy, fueled by innovation, clinical evidence generation, and the winning spirit of our global team. Q3 adjusted EPS of $0.63 grew 27%, exceeding the high end of our guidance range of $0.57 to $0.59. In Q3, adjusted operating margin was 27.2%. Turning to our fourth quarter and the full-year '24 outlook, we're guiding to organic growth of 14% to 16% for the fourth quarter and raising our full-year guidance to approximately 15%, reflecting momentum across our broad portfolio and particularly in AF solutions. Our fourth-quarter adjusted EPS guidance is now $0.64 to $0.66 and we expect our full-year adjusted EPS to be $2.45 to $2.47 representing growth of 20% to 21%. Dan will provide more details on our financials in a few minutes and I'll provide additional highlights on our third-quarter results, along with our comments and our outlook. Regionally, on an operational basis, the US grew 24% with double-digit growth or higher in six of eight business units. Our EP business continues to deliver impressive performance fueled by FARAPULSE, new account openings and very strong reorder rates. Europe, Middle East and Africa grew 14% on an operational basis. This performance was driven by continued above-market performance in EP, where we continue to expand our PFA leadership, complex PCI and structural heart. In TAVI, we received CE Mark and recently launched our next-generation ACURATE Prime Valve. I also want to announce that following a nearly 30-year career at Boston Scientific, our President of EMEA, Eric Thepaut, will retire in December and Xavier Bertrand, currently the Vice President of Peripheral Interventions in EMEA, will be appointed the new President of EMEA. I want to thank Eric for his many significant contributions to the organization and congratulate Xavier on his new role. Asia Pac grew 12% operationally with excellent performance in China, Australia, New Zealand and grew mid-teens despite recent VBP implementations. In Japan, we received PMDA approval of the FARAPULSE PFA system and anticipate reimbursement and commercial launch in the coming weeks. I'll now provide some additional commentary on our business units. Urology sales grew 10% with double-digit growth in Stone Management and Prostate Health, including double-digit growth in both Rezum and SpaceOAR. Within the quarter, we continue to see momentum from the launches of LithoVue Elite and the Tenacio Pump with our AMS 700 device. And looking forward, we expect to close the previously announced acquisition of Axonics in the fourth quarter and we're excited to add this excellent business into Boston Scientific in our Urology business. Endoscopy sales grew 7% organically and 8% operationally with strong growth, particularly in the US. Our anchor products continue to drive above-market growth with AXIOS and Exalt D, both growing double-digits in the quarter. We also continue to see strong double-digit growth in our Endoluminal Surgery franchise. We're pleased to recently received a Category 1 CPT code for the ESG weight loss procedure, which is expected to further momentum within this business. Neuromodulation sales grew 3% organically and 17% operationally including Relievant, which will turn organic in November. Our brains franchise returned to low double-digit growth in the quarter in the US, supported by de novo implants and competitive replacements. Our pain franchise grew low-single-digits organically and double-digits operationally. Our global SCS performance was below our expectations in a market that continues to be challenged, offset by growth in the rest of the pain portfolio, which reflects the value of our category leadership strategy. Peripheral Intervention sales grew 10% organically and 12% operationally. Within our Vascular business, we saw mid-single-digit growth in arterial with continued double-digit growth in Drug-Eluting therapies and low double-digit growth in Venous. We're also pleased to have closed our acquisition of Silk Road Medical in mid-September, adding the innovative TCAR system to our vascular portfolio. Our interventional oncology and embolization franchise grew double-digits again driven by continued momentum from recent launches in embolization and sustained double-digit growth in TheraSphere. Cardiology delivered another exceptional quarter with sales growing 29%. Within Cardiology, Interventional Cardiology Therapies grew 14%. Mid-teens growth in Coronary Therapies was supported by the launch of the US AGENT performance, continued global adoption of coronary imaging with our AVVIGO+ platform and our Calcium portfolio. The US AGENT launch continues to exceed our expectations with both new account openings and strong reorder rates. We also recently commenced enrollment in the aging IDE long lesion substudy and completed enrollment in our Vitalist early feasibility study in high-risk PCI patients. Congratulations to the team on that milestone. Our structural heart valves franchise grew double-digits in the third quarter led by another quarter of above-market growth of ACURATE Neo2 in Europe. In the US, we continue to collaborate with the FDA on our regulatory strategy and data from the US ACURATE IDE will be presented at TCT on October 30. WATCHMAN grew 18% with continued conversion to WATCHMAN FLX Pro in the US and Japan. And globally, we surpassed 500,000 patients treated with the WATCHMAN device, driven by our innovation, clinical evidence and patient awareness efforts. Key near-term catalyst for WATCHMAN drive our confidence in delivering high growth in this business, including the recently implemented DRG for concomitant LAAC and AF ablation. And if positive, the data readout from the OPTION trial, which will be presented as a late-breaking clinical trial at the American Heart Association Conference on November 16. We also recently commenced enrollment of our SIMPLIFY trial, which studies the less intensive post-procedure drug regimen, enabled by our latest generation WATCHMAN FLX Pro, and continue to expect data from the CHAMPION trial in the first half of '26. Cardiac Rhythm Management sales grew 2% in the quarter. In the third quarter, our Diagnostics franchise grew high-single-digits, driven by our implantable cardiac monitors, LUX-Dx, which both received CE Mark within the quarter. In Core CRM, strong international growth was offset by below market growth in the US. We're excited about new and upcoming product launches in this business, including the expanded indication of our INGEVITY lead for conduction system pacing, which received FDA approval in the quarter, and our EMPOWUR leadless pacemaker, which we now have submitted to the FDA. Electrophysiology sales grew an exceptional 177% in the quarter, driven by continued commercial execution, pull-through in our Access Solutions business and increased procedure volumes driven by excellent outcomes as well as efficiencies gained with FARAPULSE. We have now treated over 125,000 patients with FARAPULSE, driving rapid and transformative conversion from RF and cryo to PFA, specifically using FARAPULSE. As a result of this accelerated conversion in the market, we now expect PFA to likely exceed our previously communicated range of 40% to 60% of global AF ablations by 2026. We are excited about the recent FARAPULSE approvals in both Japan and China and expect these launches to have a meaningful impact on our global EP business in 2025. Recently, we received USA approval of the FARAWAVE NAV Catheter, which combined with a FARAVIEW Software to visualize cardiac ablation procedures exclusively with our OPAL HDx mapping system. We are pleased to have completed the follow-up Phase I of the ADVANTAGE AF clinical trial, which is evaluating FARAPULSE in the treatment of patients with drug-refractory persistent AF. And we expect to submit the results of the trial to the FDA later this quarter and anticipate presenting the results in early '25 with label expansion expected in the second half of '25. We're also studying in a very new patient population of drug-naive persistent AF patients in AVANT GUARD. As we have neared the end of this enrollment, we have elected to temporarily pause the trial to assess a few unanticipated observations. It is our intention to resume enrollments in the near-term. And based on the totality of clinical evidence and commercial real-world experience, we remain extremely confident in the unique performance of FARAPULSE. In closing, we're very proud of the performance of our global teams and are confident in the sustainability of our top-tier financial performance. With that, I'll hand over to Dan and provide more details on the financials.

Thanks, Mike. Third quarter 2024 consolidated revenue of $4,209 million represents 19.4% reported growth versus third quarter of 2023 and includes a 10 basis point headwind from foreign exchange, which was favorable versus our expectations. Excluding this $4 million foreign exchange headwind, operational revenue growth was 19.5% in the quarter. Sales impact from closed acquisitions contributed 130 basis points, resulting in 18.2% organic revenue growth, exceeding our third quarter guidance range of 13% to 15%. Q3 2024 adjusted earnings per share of $0.63 grew 27% versus 2023, exceeding the high end of our guidance range of $0.57 to $0.59 primarily driven by our strong sales performance. Adjusted gross margin for the third quarter was 70.4%, slightly lower than anticipated, driven primarily by foreign exchange. We continue to expect second half adjusted gross margin to be higher than the first half, and full year adjusted gross margin to be slightly below our 2023 rate. Third quarter adjusted operating margin was 27.2%, which expanded 110 basis points versus the prior year period. Given our strong year-to-date performance, we now expect full year adjusted operating margin to be approximately 27%. We believe this strikes a nice balance of delivering incremental margin from our sales upside and continuing to invest appropriately to drive strong top line performance. On a GAAP basis, third quarter operating margin was 17.4%. Moving to below the line, third quarter adjusted interest and other expenses totaled $65 million, which was favorable to our expectations primarily due to higher interest income. On an adjusted basis, our tax rate for the third quarter was 13.2%, which includes favorable discrete tax items. Our operational tax rate for the quarter was 13.5%. Fully diluted weighted average shares outstanding ended at 1,487 million in the third quarter. Free cash flow for the third quarter was $822 million, with $1,002 million from operating activities less $180 million in net capital expenditures, which includes payments of $208 million related to acquisitions, restructuring, litigation and other special items. In 2024, we continue to expect full year free cash flow to exceed $2 billion, which includes approximately $900 million of expected payments related to special items. As of September 30th, 2024, we had cash on hand of $2.5 billion, and our gross debt leverage ratio was 2.4 times. Our top capital allocation priority remains strategic tuck-in M&A followed by annual share repurchases to offset dilution from employee stock grants. Our legal reserve was $250 million as of September 30th, roughly flat versus Q2 2024. I'll now walk through guidance for Q4 and full year 2024. We expect full year 2024 reported revenue growth to be approximately 16.5% versus 2023. Excluding an approximate 50 basis point headwind from foreign exchange, based on current rates, we expect full year 2024 operational revenue growth to be approximately 17%. Excluding a 200 basis point contribution from closed acquisitions, we expect full year 2024 organic revenue growth to be approximately 15% versus 2023. We expect fourth quarter 2024 reported revenue growth to be in a range of 16.5% to 18.5% versus fourth quarter 2023. Excluding an approximate 50 basis point tailwind from foreign exchange, based on current rates, we expect fourth quarter 2024 operational revenue growth to be 16% to 18% and excluding a 200 basis point contribution from closed acquisitions, we expect fourth quarter 2024 organic revenue growth to be in a range of 14% to 16% versus 2023. We continue to expect full year 2024 adjusted below-the-line expenses to be approximately $300 million. We also continue to expect a full year 2024 operational tax rate of approximately 13.5% and an adjusted tax rate of approximately 12.5%, which contemplates current legislation, including enacted laws and issued guidance under OECD Pillar 2 rules. We expect full year adjusted earnings per share to be in the range of $2.45 to $2.47 representing growth of 20% to 21% versus 2023, including an approximate $0.04 headwind from foreign exchange, which is unchanged from our previous expectations. We expect fourth quarter adjusted earnings per share to be in a range of $0.64 to $0.66. Before we move to Q&A, I want to provide a few housekeeping items related to 2025 that may be helpful with your modeling. There will be one less business day in 2025, which comes in Q1. Note that in 2024, we have two extra business days versus 2023, one here in Q3 and one upcoming in Q4. Below the line, we expect a meaningful increase versus 2024 related to higher adjusted net interest expense. In 2024, we will earn approximately $100 million of nonrecurring interest income on the cash raised earlier this year to fund the Axonics acquisition, which we expect to close here in the fourth quarter. In 2025, we also have approximately $1.6 billion of bonds coming due, which we expect to look to refinance likely at higher rates than the existing bonds while maintaining our strong balance sheet. The good news is, this incremental expense should largely be offset by the operating income dollars associated with the deals we have closed in 2024 and the expected close of Axonics. Based on current global tax legislation, we expect our tax rate to be in line with our historical rate of approximately 14% operational and 13% adjusted. In 2025, we will aim to outperform our markets, deliver meaningful margin improvement and grow adjusted earnings per share double-digits and faster than sales towards our goal of being the highest performing large-cap medtech company as we said at last year's Investor Day. For more information, check our Investor Relations website for Q3 2024 financial and operational highlights which outlines more details on Q3 results and 2024 guidance. And with that, I'll turn it back to Jon, who'll moderate the Q&A.

Thanks, Dan. Drew, let's open it up for questions for the next 40 minutes or so. In order for us to take as many questions as possible, please limit yourself to one question. Drew, please go ahead.

We will now begin the question-and-answer session. The first question comes from Robbie Marcus with JPMorgan. Please go ahead.

Great. Good morning and congrats on another fantastic quarter here.

Thanks, Robbie.

My one question, there's so much to ask about here. In our checks, we hear consistently that the upcoming OPTION trial that we'll see at AHA, combined with the recently started on October 1st reimbursement for concomitant WATCHMAN and PF ablation has already started to kick in the gear and OPTION could meaningfully alter the usage patterns ahead of CHAMPION in the first half of '26. So I wanted to get your thoughts on the importance of both concomitant and should OPTION be positive what that can mean for both of those franchises, both in the short and long-term? Thanks.

Sure. I'll comment and Dr. Stein can add probably more helpful color. Clearly, independently, both platforms are doing incredibly well. WATCHMAN on its own with all the clinical evidence, and you saw the amazing results of FARAPULSE today. And doctors are so comfortable with both procedures. It's a very safe procedure. The concomitant reimbursement, we view as quite positive. It's also very positive economically for the hospital, benefits for the patient, and the procedure will be performed safely. So we're really pleased with that concomitant. And so it's clearly an ongoing long-term tailwind for WATCHMAN and also further helps FARAPULSE. Both platforms, as you know, have a number of different clinical trials to continue to expand indications. And Dr. Stein, any other comments you'd like to make on it?

No. Sure, Mike. Thanks, Robbie. I again reiterate what Mike said at the outset, right? I mean, the ability to do concomitant procedures and get reimbursed with them under the new CMS DRG, it's one of those things that it's positive for patients, it's positive for the health care system and hospitals, and it's certainly positive for us given the unique advantages in doing concomitant procedures when you think of the safety and efficiency of FARAPULSE, and you think of the safety and efficiency and frankly excellent outcomes with FARAPULSE and with WATCHMAN FLX and WATCHMAN FLX Pro. Again, just to give some sense of the importance of this, right, there are approximately 350,000 ablations performed in the US every year for atrial fibrillation. And roughly half of those patients are at high risk of stroke according to things like the CHA2DS2-VASc scoring system. I think we are all anxiously looking forward to see the OPTION data when it gets read out, and the impact that will have, I think stating the obvious will depend on what those data show. And if they do show a compelling benefit to WATCHMAN, right, how big is that benefit? And then, again, to reiterate what Mike said, beyond OPTION, we also have the CHAMPION trial. Expecting that trial to read out in early '26, which would look at WATCHMAN versus the new oral anticoagulants in all comers.

Great. Thanks a lot.

The next question comes from Joanne Wuensch with Citi. Please go ahead.

Good morning and thank you for the question. I want to talk about the amazing results of FARAPULSE that we just saw. And specifically how you're thinking about moving. I was really interested in one quote that you said to exceed 40% to 60% of global AF procedures by 2026. Thank you.

Sure. So this has just been a tremendous launch. Just a quick shout out to our operations supply chain team for staying ahead of the manufacturing. Extremely high demand for this product and the excellence that we're seeing in the field by the commercial and clinical teams. So doctors are moving surprisingly quickly towards FARAPULSE, surprisingly to what we thought it would be a year ago. So when we had the Investor Day, we weren't quite sure because we didn't have approval in the US. We saw excellent momentum in Europe. And now our operations team is scaled to meet the demand. And those same excellent clinical outcomes and procedural efficiencies and safety benefits that patients received in Europe are being felt throughout the world now. We've been planning over 120,000 of them. So that was our point estimate about a year ago or so. And based on the rapid uptake, we're confident in stating that we do expect it to be at the high end and likely exceed that 40% to 60% based on how quickly physicians are transforming, especially for PVI from traditional RF and cryo to FARAPULSE. And it's also been supported by the studies within ADVENT that show the benefits of FARAPULSE versus traditional RF. So it's a great time in the market for the physicians and the patients. And we've also proven, based on our competitive launches in Europe who have been out for a while that we clearly are the market leader in PFA and we have lots of plans in place to continue to extend that leadership with clinical differentiation and product enhancements.

Thank you.

The next question comes from Larry Biegelsen with Wells Fargo. Please go ahead.

Good morning. Thanks for taking the question. I'll echo my congratulations on a really phenomenal quarter here. Dr. Stein, given the importance of FARAPULSE, can you provide more color on the AVANT GUARD trial and the observations you saw? And related to that, there are going to be more PFA ablation choices soon, including from the market leader. Once these new PFA catheters are launched, what are the factors that will lead existing FARAPULSE customers to stay with FARAPULSE or choose FARAPULSE if they haven't adopted it yet? Thank you.

Yes. Sure, Larry. Let me take those successively. So first, on AVANT GUARD. Again, as Mike said, due to a few unanticipated observations in the trial which is studying a completely new population, which is drug-naive patients with persistent AF, which FARAPULSE is not currently indicated to treat. We did elect to temporarily pause enrollment until we develop better understanding of the observations. While none of the observations were life-threatening, we did make a decision to temporarily pause, but it is our intention to resume enrollments in the near-term. And this in no way at all affects our confidence in the overall performance of the FARAPULSE system as it's being used today commercially or in other clinical trials. Again, as Mike said in his opening comments, we remain confident that we're going to obtain expanded indication for drug-refractory persistent AF patients. And that's the data from our ADVANTAGE Phase I trial. Again, as Mike said, we expect to submit that data to the FDA later this quarter. We expect to present that data in early 2025, with indication expansion expected to come in the second half of 2025. And again, I just want to close by emphasizing that this patient population that we're studying in AVANT GUARD, which is drug-naive persistent AF patients has not previously been studied, it's a population that's not indicated for ablation today under guidelines, and it's not the population that's being treated today with FARAPULSE system. And I also want to emphasize that we remain highly confident in the global performance of FARAPULSE, which has now been used to treat more than 125,000 patients across more than 65 different countries and is supported by extensive clinical data demonstrating positive outcomes for the device. And I think that also leads into your second question, right, which is why is FARAPULSE going to maintain category leadership in Pulsed Field Ablation and what's going to prompt new users to continue to newly adopt the system. And it's several things. I think, first of all, it's just the compelling ease of use and straightforward nature of doing the ablation with FARAPULSE. It's just a tremendous clinical experience that people have when they start using the system. I am not aware of anyone who started using this and then has stopped and gone back to thermal ablation. It's also an extensive clinical trial data that we've got supporting it. As Mike mentioned, right, we had a sub-analysis, the ADVENT data, which is the first data that anyone has had to actually show superiority and efficacy outcomes when we look at AF burden as a secondary analysis of the ADVENT data. It's supported by published clinical data now in approximately 20,000 patients globally. And again, as Mike said, right, in Europe, where we've seen commercial systems launch, right, we really have not seen that meaningfully detract from the position that FARAPULSE has as the leading PFA system in those markets. And then last, just to make sure it doesn't get lost in all the other stuff here, right, the approval and the launch now of FARAWAVE NAV Catheter and FARAVIEW mapping system, which really becomes the first mapping system that's really designed around PFA, I think, provides just maybe it's the cherry on top of that sundae in terms of answering your question.

Thank you so much.

The next question comes from Rick Wise with Stifel. Please go ahead.

Thank you, and good morning, everybody. I'm hoping, Mike, that you or Dr. Stein will expand on the NAV Cat comments from a couple of aspects. Just are you ready to fully launch and train? Will NAV Cat have a price premium, given premier technology first to market with something like this integrated? Can we assume that you're going to sell it at a higher price? And just last and sort of related to what Dr. Stein was talking about as well. If FARAWAVE is approved for only AFib, obviously a huge portion of the market, how does it, how are you going to manage the argument that other imaging mapping systems, obviously, are approved for all imaging? Just where will FARA NAV fit in, in the broader, the larger scheme? Thank you.

Dr. Stein?

Yes, Rick. Let me take the second part of that question first and then get on to what some of the advantages are that we see unique to FARAVIEW right, which is on our refreshed OPAL HDx platform. And so again, right, the OPAL platform is approved for mapping navigation across the whole spectrum of cardiac arrhythmias. Now when we look at the use specifically as it integrates with FARAWAVE and FARAWAVE NAV, like FARAWAVE is an AF ablation catheter. And I think part of the reason that we've seen the success that we've had, part of the reason I was able to give the answer that I did to Larry, right, is that it's just exquisitely beautifully designed for ablating atrial fibrillation. It's a fantastic tool for pulmonary vein isolation. And again, we hope to share our data from our ADVANTAGE clinical trial showing how it is also can be used to treat persistent atrial fibrillation. But it is really explicitly not designed to be the catheter to tackle some other arrhythmias. The next catheter in our pipeline is our FARAPOINT Catheter. And that catheter was studied in Phase II of our ADVANTAGE clinical trial. We have completed enrollment in that Phase II of ADVANTAGE and are continuing to follow those patients. And to start, we'd expect to qualify that catheter for use for treating arrhythmia called atrial flutter as an adjunct to atrial fibrillation ablation procedures. But beyond that, right, it could see FARAPOINT used, right, for really any sort of arrhythmia where you would prefer a point catheter form factor. And then next to follow after that, right, is our so-called map and ablate catheter. It's a large focal lesion catheter called FARAFLEX, right, which, again, all of these will integrate with FARAWAVE on OPAL, right? And that would really give us building the capability to be able to target the vast majority of arrhythmias that are seen in clinical practice. In terms of FARAVIEW specifically, again, I think it's really important to emphasize. This is the first mapping and navigation software that's built around understanding Pulsed Field Ablation. And so it gives a lot of advantages to users to want to use it to navigate a catheter. It gives dynamic visualization of the FARAWAVE catheter as it moves into its various configurations, whether it's a basket or a flower or anything in between. And it's also got a unique feature called field tagging, where physicians will be able to see where the pulsed field will intersect with tissue and hopefully allow them to better strategize where and when and how to put lesions in when they're doing an ablation procedure.

That's an amazing answer. And just the price premium part?

Yes, I'm not going to comment on pricing on specific products, Rick?

Thanks so much, everybody.

The next question comes from David Roman with Goldman Sachs. Please go ahead.

Thank you and good morning everyone. I was hoping to switch gears a little bit from the EP side of the business. And maybe if you could spend a few minutes on the performance of the franchises kind of ex-WATCHMAN and EP, which are still trending very well, although a slowdown from where you started the year. How are you thinking about resource allocation and just the focus on those businesses and maintaining ongoing support for those franchises in light of the success of PFA? And how should we think about the growth drivers in some of those more established categories on a go-forward basis?

Sure. I'll take that. We operate with a very decentralized structure, and the leaders of our divisions focus solely on their areas. They manage global teams with thousands of employees who concentrate on various sectors such as peripheral interventions, interventional oncology, endoscopy, urology, and neuromodulation, along with ICTx, which saw a growth of around 15% this quarter. Their teams are highly focused on executing these businesses globally. We recently completed the acquisition of Silk Road and expect to finalize the acquisition of Axonics in the fourth quarter. As Ken mentioned, we aim to establish category leadership through our broad portfolio and distinct innovations within each division. While our success varies, we generally perform well in this aspect. Regarding capital allocation, we have made significant investments in ramping up PFA manufacturing, ongoing research and development, clinical studies, and enhancing our commercial capabilities to bolster our mapping sales force. However, these efforts have not diminished our investments in other foundational businesses. Remarkably, we continue to enhance our margin profile, which reflects the dedication and winning mentality of our team. We have a robust pipeline of organic products within these units, and our performance for the quarter and the full year reflects this. We did notice a slight decline in procedure volumes during July and August, particularly in our endoscopy and urology business, but there was a rebound in September, aligning with our growth over the past eight quarters. We have confidence in these businesses, and while Dr. Stein and I focus more on PFA, we remain fully committed to supporting all our company divisions.

Great. Thanks. I appreciate the perspective.

The next question comes from Patrick Wood with Morgan Stanley. Please go ahead.

Perfect. Thank you very much for taking my question. I guess just one on capacity in totality for the system. Obviously, I get PFA adding some efficiencies to the system overall. But for EPs, between WATCHMAN and everything, there's a tremendous call on people's time. We saw in structural heart a little bit of noise on one of the players saying there were capacity constraints. How are you viewing that going forward? And how quickly do you think the system can adapt to enable you to keep growing these franchise and still have capacity to actually get them done? Thanks.

Well, we're still relatively early in our launch. In the US, we got approved in February. We started launching in late February and March. So that we still have a number of new accounts that have not used FARAPULSE in the US. And we have yet to launch in Japan and we've yet to launch in a meaningful way in China in many other countries. So we're still quite early in the launch in very major markets. And we're seeing, in currently launched accounts, we're seeing many accounts move from one system originally to two, three, and sometimes four systems. So they're increasing their utilization of FARAPULSE across their multiple labs. So we have a lot to do to continue to increase share within existing accounts. And then thirdly, because of the efficiencies of the system, the hospitals are improving their workflow, and most accounts are doing, I don't know, Ken, 25%, 30% more procedure volume in a day. So there's a lot of efficiencies and the hospitals win economically and the patients benefit as do the physicians. And then to your term on capacity, that's why this concomitant procedure is also a big win for the workflow of the hospital and the patient. So now an extra 10, 15 minutes for the appropriate patient, you can do a FARAPULSE system as well as the LAAC with WATCHMAN. So it also drives procedural efficiency, which is very unique to Boston Scientific versus our competitors. So when we design these platforms, we look at operational efficiency and also the economics of the hospital. And we think FARAPULSE and WATCHMAN and concomitant are all very helpful to hospitals' efficiency. And we're still really early in the launch of FARAPULSE.

Love it. Thanks for the color.

The next question comes from Travis Steed with Bank of America. Please go ahead.

Hey, thanks for taking the question. I wanted to follow up on the AVANT GUARD trial pausing. I guess a lot of questions on that this morning. So it seems like the observations you saw didn't change your thoughts drastically if you're restarting the trial soon. And then just making sure that maybe help us understand why this doesn't really change your view on safety of FARAPULSE overall or mitigate the real-world data you have or and maybe just help us understand this patient population that's in this trial today, how they're getting treated today would be great? Thanks a lot.

Yes. Sure, Travis. Let me again begin, at least the patient population. And so right today standard of care for patients with newly diagnosed persistent atrial fibrillation is to get a trial of antiarrhythmic drug therapy first. And then guidelines would say only to be referred for ablation if they actually fail antiarrhythmic drug therapy. Obviously because even though we've paused enrollment for the moment, there's still an ongoing clinical trial. So I really can't get into any detail on the observations. Again, just to reassure everyone, nothing that we saw certainly was life-threatening. And I think we are very highly confident in the overall safety profile, overall efficacy and again overall efficiency of the FARAPULSE system. And again that's just based on the extensive experience that we've got with it, which is both commercial experience, as we said, over 125,000 patients now have been treated with this system globally as well as extensive clinical data that's been published in approximately 20,000 patients and data that we see from all of our ongoing clinical trials.

Great. Thanks a lot.

The next question comes from Danielle Antalffy with UBS. Please go ahead.

Hey, good morning, everyone. Thanks so much for taking the question. Congrats on this amazing quarter. I'm kind of speechless. But just wanted to ask, I appreciate there's not going to be a lot you can say, Dan, I appreciate the comments that you did give on 2025. But specifically, as we think about sales, you noted above-market sales growth. I mean the market can be a moving target a little bit here about how you think about the market's growing next year. So I was hoping maybe you could give a little bit more color, if possible, even if it's just highlighting tailwinds and headwinds from a sales growth perspective to think about as we look ahead to 2025. Thanks so much.

I'll start and then Dan, you can clean up my mess. So we're excited, obviously, about '24 growing estimated 15% over a comp of 12% of 2023. And as we head into 2025, obviously, we'll have a nice comp at approximately 15%. But there's so many good things going on with the company. Thank you for the non-FARAPULSE question that was asked earlier about the other businesses like PI and ICTx and neurology commonly growing double-digits and the strength of endo and we want to strengthen neuromod and US CRM a bit more. And so but as we look at 2025, the big headlines obviously are FARAPULSE and WATCHMAN. We do think the Japan launch and China launch will drive meaningful growth for the franchise. And as I mentioned just prior, there's a number of new accounts to open in the US and there's a lot of penetration in current accounts to add additional volume to both FARAPULSE. You've heard all about the concomitant reimbursement for WATCHMAN. So those are all nice tailwinds for the company. The procedure volumes we see are relatively consistent. We did see a bit of a slowdown in July and August, but strengthening in September. And so we think procedure volumes will maintain strong versus as they are now. And we see strong global performance. So obviously, we'll have some more challenging comps. There will be some more competition in PFA, but we're doing very well, I guess, that competition in Europe. I don't know, Dan, also we have the AGENT, which throw one out to the cardiology team, which has performed quite well. So we'll find out about reimbursement on that product in the next coming weeks. That should add some additional momentum to that franchise.

I think that summarizes it well. And just to give you a sense of the process, it's no different than it is any year. We have our annual operating plan process that's alive and well here through the fourth quarter. We'll review that as we go through the end of the quarter and into early next year and we'll let you know what we think for 2025 at our Q4 earnings call.

Appreciate it. Thanks, guys.

The next question comes from Anthony Petrone with Mizuho Group. Please go ahead.

Thanks and congrats on a strong quarter here. I think the question will be on the go-to-market next year, 2025, you go back to the October 18 press release and you have FARAWAVE NAV Catheter out there, but it indicates that it's exclusive to OPAL on the mapping side. So in other words, the company is coming with a closed loop offering here next year. And presumably, we'll have competitors that are coming with a bundled approach. So maybe the question here is just when we enter '25, it seems that three competitors will be out there with a bundled approach to PFA with mappers. So maybe just walk through that dynamic a little bit. Congratulations again on the quarter.

Yes. I'll just comment and Ken, again, you can finish this. So today customers using FARAPULSE with our legacy RHYTHMIA mapping system and they're also using it with our two primary competitors today. So the OPAL platform will not be closed out in such a way that if a physician wants to continue to use a competitive mapping system with FARAPULSE, they still can. We do think that with the OPAL mapping system, specifically with FARAPULSE, the user experience will be more meaningful and more streamlined and differentiated. So we're not closing the system and that we're shutting out competitive systems from doing FARAPULSE cases. But we're quite confident in the user experience, the overall economics and the value of the OPAL integration with FARAPULSE to be differentiated versus what they're using today.

Yes. I mean, Anthony, just to again build on what Mike said, right, we do not feel that we've got to force people to use our products. And what we see with FARAWAVE is people want to use it. And people have used it in a variety of different ways, and we are going to continue to support their ability to use it in the way that they want to. And that includes people who use no mapping navigation at all, which is really through the predominant use case that we see in Europe and throughout a lot of the world or use it with a mapping and navigation system. We're going to continue to keep the original, right, the FARAWAVE Catheter without the NAV sensor on the market for people who want to use it with a competitive mapping system. FARAWAVE NAV, because it's got a magnetic NAV sensor, and it does have to get tied into a particular mapping system, which for us is the refreshed OPAL HDx system with FARAVIEW. But we're not going to force people to use it. We think it's got enough compelling differentiated advantages compared to what else is out there that people are going to want to use it.

Very helpful. Thank you.

The next question comes from Vijay Kumar with Evercore ISI. Please go ahead.

Hi, guys. Congrats on a nice quarter here and thanks for taking my question. Mike, maybe one for you on next week's ACURATE Neo2 results here. What is the regulatory strategy? Do you expect to file with the FDA? And I think you mentioned that you expect to have a successful launch in the US. Is that referring to Neo2 or some other generation of the valves? So maybe talk about your TAVR strategy in the US?

Sure. So as we've talked about before, the ACURATE Neo2 trial on the 1,500 patient will be TCT on what Wednesday? October 30th. So that is an important milestone to see that clinical trial data that will be presented. And we'll actually be holding an investor meeting that day with Joe Fitzgerald and Lance Bates and the team to talk about the broader cardiology portfolio and the plan for ACURATE post the data. As you know, we've continued to have excellent momentum in Europe. You saw the third quarter results. We continue to grow above-market. And kudos to the team on the launch of Prime, the next-generation ACURATE Neo2, which they just recently started implementing in Europe.

Sorry and does it mean you expect to file with the FDA, Mike? And what does successful launch mean?

Well, a successful launch, we've never provided share attainment goals just like we don't provide a share for FARAPULSE. So we obviously want to grow the business. It's a very large market, a very mature market growing, I don't know, 8%, 7%, 9% and we continue to do quite well in the US, but we'll provide more information at the TCT at the investor call there.

The next question comes from Matt Miksic with Barclays. Please go ahead.

Thank you for having us today and congratulations on a really impressive quarter and all the great growth drivers you have in place. I have a question, possibly for Dan, regarding the dynamics in the gross margin line this quarter, where you mentioned foreign exchange being a primary headwind. As we look ahead to 2025, could you discuss where the leverage in the model might be, if you're expecting stable gross margins while leveraging some of the operating investments you're making? I'd appreciate any insights you have on how you see that progressing at this stage. Thank you.

Sure, Matt. The Q3 story is actually pretty simple. So we were 70.4% gross margin in Q3, slightly below what we would have expected and that's really driven by foreign exchange in the quarter. So simple story for Q3. We've said consistently that we believe our full year adjusted gross margin will be below last year. Last year, we were 70.7%. So we've consistently said, you know what, we're probably not going to hit that 70.7% in 2024, that's okay because we're actually driving 70 basis points of adjusted operating margin expansion without that kind of testament to the hallmark of the DNA of the company of continuing to drive margin expansion through all lines of the P&L. So 2024 gross margin, not going to contribute, that's okay because we have the SG&A and other horses to ride there. As you go into '25 and beyond, I think all lines of the P&L could contribute. I think gross margin is part of that. And how does that happen? A big piece of that will be product mix. So call FARAPULSE today, the single-use catheter, that's a nice margin, but you have a lot of that, the capital placements that we have. As Mike mentioned, we're still launching this. It's only six or seven months into the launch. So we're still launching a lot of capital, placing a lot of capital. And next year, we'll have Japan and China. So we'll still be doing that. We'll be effectively launching there. But I think the story is as you go into '25 and work through '25 and beyond, FARAPULSE becomes accretive overall as the single-use catheter kind of swamps the overall margin within FARAPULSE and is accretive to overall Boston Scientific. WATCHMAN is obviously helpful. You heard a lot of commentary on the call today about the some of the tailwinds that could be there for WATCHMAN. That's great news for the gross margin line. So I think the takeaway is gross margin, '25 and beyond, gross margin can be a contributor to the overall operating margin journey that's been so successful for the company for the last decade.

That's great. Thanks a lot. Thanks.

The next question comes from Josh Jennings with TD Cowen. Please go ahead.

Hi, good morning. Thank you for taking my questions and congratulations on another impressive quarter. I wanted to follow up on what Mike mentioned about your operations and supply chain team managing the demand for FARAPULSE and staying on schedule. I want to confirm that there won't be any manufacturing capacity issues next year if that sector continues to exceed internal expectations. Additionally, I'd like to understand your team's perspective on the mapping segment. Our understanding is that mapping capital and diagnostic mapping catheters represent an even larger percentage of the overall ablation market than the ablation catheter segment. While I know you're well positioned there, I wanted to review that and get insights into the revenue structure for Boston Scientific, specifically whether the FARAPULSE NAV Catheter will be single-use for pulmonary vein isolations, and how you're developing your diagnostic mapping catheter portfolio. I apologize for the multipart question.

Hey, Josh, I'll take the second part first and then we can get to the supply issue. So just for clarity. FARAWAVE NAV Catheter, it is a single-use device. It is, again, current indicated for PVI for patients with paroxysmal atrial fibrillation. As we said at the ADVANTAGE clinical trial is our clinical trial to get label expansion for the FARAWAVE Catheter family for use in patients with drug-refractory persistent atrial fibrillation. And again I think what we really want to emphasize here is that there's some really significant differentiated advantages to FARAVIEW versus other systems that are currently on the market for mapping a navigation of PFA catheters, right? And that's specifically ability to dynamic visualization of the catheter shape as it changes ability also to do field tagging and so ability to plan where to put lesions in when you're doing an ablation procedure.

And just in terms of the diagnostic mapping catheter portfolio buildout, you guys do have a high-density mapping catheter in the pipeline is my understanding, but just wanted to get a better look on that.

Yes. I mean, Josh, we already have a high-density mapping catheter, right, which is our ORION catheter, which can be used on the refreshed OPAL system. And then as we go down the road, right, we've talked about additional catheters and be part of the FARAPULSE family, which includes FARAPOINT and includes our FARAFLEX catheter, which would have the capability to do both high-density mapping and also do PFA ablation in the same catheter.

We are performing exceptionally well in the ablation segment. We anticipate that OPAL will perform favorably in the mapping sector, an area where we have been underrepresented. However, there are still parts of the electrophysiology procedure landscape that we do not currently participate in but plan to expand into over time. Additionally, regarding FARAPULSE in China, while it's not a question, we are pleased about our approvals in Japan and China. We foresee a more gradual launch in China compared to the US and Japan, primarily due to the need for approvals and registries, as well as the pace of launching new accounts. Although we've had successful openings in China, we do not expect the same rapid rollout as seen in the US. Nonetheless, we anticipate a strong launch in Japan. I also want to acknowledge our China team. Despite the significant volume-based procurement challenges that have affected our IVUS franchise and the prospect of more VBPs in 2025, we are still growing at about the company average in China, while many of our competitors are experiencing more challenging results.

Drew, let's take one more question.

Thank you. That question will come from Matt O'Brien with Piper Sandler. Please go ahead.

Good morning. Thanks for taking the question. And I'd much rather focus on all the positive things going on here, but I'm looking at the stock down now versus up prior to this AVANT GUARD commentary. So Dr. Stein, I'm not sure exactly what you can say, but is there any kind of safety signal that we should be aware of? And then if you can't comment on that, is there anything to think about in terms of this patient population really being the cause of the difference, maybe extra lesions that need to be created, higher risk benefit requirements because it's drug-naive patients. Just anything along those lines that you can share because I think folks are pretty nervous this morning just based on how important FARAPULSE is to the business. Thanks.

Yes, Matt, again, because this is an ongoing trial, I can't get into any details. Again, what I can say is we are highly confident in the safety of the system. Again, we've got extensive commercial use data and over 125,000 patients treated. We've got extensive published clinical trial data and other ongoing clinical trials and are highly confident in the safety, the efficiency, and the efficacy of the FARAPULSE system.

We expect to re-launch this trial soon.

All right. Thanks, Ken. Thanks, Mike, and thanks, everyone for joining us today. We appreciate your interest in Boston Scientific. If we weren't able to get to your question or if you have any follow-ups, please don't hesitate to reach out to the Investor Relations team. Before you disconnect, Drew will give you all the pertinent details for the replay. Thanks, everyone. Have a great day.

Please note, a recording will be available in one hour by dialing either 1877-344-7529 or 1412-317-0088 using replay code 2607711 until October 30th, 2024, at 11:59 P.M. Eastern Time. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.