Boston Scientific Corporation

The Federal Trade Commission has given final approval to a consent agreement with Boston Scientific Corporation, settling charges that its acquisition of Cardiovascular Imaging Systems, Inc.(CVIS) and SCIMED Life Systems, Inc. would eliminate competition in the market for the intravascular ultrasound catheters (IVUS) used in the diagnosis and treatment of heart disease. The Commission's action makes the consent order provisions binding on the respondents.

Under the final order, Boston Scientific will grant a non- exclusive license--to Hewlett Packard or another Commission- approved purchaser--to a broad package of patents and technology related to the manufacturing, production and sale of IVUS catheters currently on the market and in development. The package includes all CVIS, SCIMED and Boston Scientific patents, all CVIS and SCIMED non-patented technology relating to IVUS catheters, and Boston Scientific and CVIS IVUS-catheter customer lists.

The settlement also requires that Boston Scientific sell IVUS catheters to the licensee and to provide the technical assistance and advice necessary to obtain Food and Drug Administration approval to manufacture IVUS catheters. It prohibits Boston Scientific from entering into exclusive contracts with manufacturers of IVUS consoles that would exclude a new IVUS-catheter producer from the market.

Finally, the settlement requires Boston Scientific to obtain Commission approval, for 10 years, before acquiring an interest greater than one percent in any company engaged in researching, developing or manufacturing IVUS catheters for sale in the United States. The prior approval provision also would apply to acquisitions of assets or of exclusive rights to patents or technology used for the manufacture or sale of the catheters.

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BSC/CVIS/SCIMED--5/3/95)

The consent agreement was announced for a public-comment period on Feb. 24. The Commission vote to issue it in final form occurred on May 28 and was 4-0, with Chairman Robert Pitofsky recused. Commissioner Mary L. Azcuenaga issued a separate statement. Commissioner Azcuenaga concurred in the final consent agreement except with respect to the Commission's agreement to abbreviate the public comment period and the fixed date for the expiration of the hold-separate agreement. Noting that the proposed order reduced the public comment period established in the Commission's Rules from 60 to 30 days, she said, "It should go without saying that the requirements of the Commission's Rules of Practice are not a proper subject for negotiation." Commissioner Azcuenaga also said that the Commission should not condone fixing a date certain for termination of the hold- separate agreement. "The Commission's interest in completing its review of this case expeditiously is commendable, but its agreement to the date certain, in my view, is not....A willingness to act expeditiously is quite different from acquiescing in advance to a 'drop dead date' that potentially leaves the Commission unable fully to consider new issues, conditions or information that may arise between the time it commits to the date certain and the time that date arrives."

NOTE: A consent agreement is for settlement purposes only and does not constitute admission of a law violation. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions by the respon- dents. Each violation of such an order may result in a civil penalty of up to $10,000.

A news release summarizing the complaint and consent agree- ment was issued at the time the Commission accepted the consent agreement for public comment. Copies of that release, the complaint and final order and Commissioner Azcuenaga's statement are available from the FTC's Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580.

(FTC File No. 951 0002)

(Docket No. C-3573)