Investor Update January 12, 2018 Maulik Nanavaty Senior Vice - - PowerPoint PPT Presentation

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North American Neuromodulation Society Investor Update

January 12, 2018

Maulik Nanavaty Senior Vice President and President, Neuromodulation Jim Cassidy Vice President and Franchise Lead, Pain Management Milad Girgis Vice President and Franchise Lead, Deep Brain Stimulation

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Safe Harbor for Forward-Looking Statements and Regulatory Disclaimers

This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements may be identified by words like “anticipate,” “expect,” “project,” “believe,” “plan,” “estimate,” “intend” and similar words. These forward-looking statements are based on our beliefs, assumptions and estimates using information available to us at the time and are not intended to be guarantees of future events or performance. If our underlying assumptions turn out to be incorrect, or if certain risks or uncertainties materialize, actual results could differ materially from the expectations and projections expressed or implied by our forward-looking statements. Factors that may cause such differences can be found in our most recent Form 10-K and Forms 10-Q filed or to be filed with the Securities and Exchange Commission under the headings “Risk Factors” and “Safe Harbor for Forward-Looking Statements.” Accordingly, you are cautioned not to place undue reliance on any of our forward-looking statements. We disclaim any intention or obligation to publicly update or revise any forward-looking statements to reflect any change in our expectations

• r in events, conditions, or circumstances on which they may be based, or that may affect the

likelihood that actual results will differ from those contained in the forward-looking statements. Market Estimates: Unless noted otherwise, all references to market sizes, market share positions, and market growth rates are BSX internal estimates. Regulatory Disclaimers: Vercise™ PC Deep Brain Stimulation System/Vercise™ Directional System - CE Marked. US: “Caution: Investigational Device. Limited by Federal (or US) law to investigational use only. Not available for sale.” Vercise Gevia™ Deep Brain Stimulation System - CE Marked. Not available for use or sale in the U.S. Next Gen DBS System: Device under development. Not for sale or use worldwide.

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Positioned for Leadership in Two Fast-Growth Markets

Overview BSX Growth Drivers

• Spectra Wavewriter ™ SCS System

First & only system FDA approved to simultaneously provide paresthesia and sub-perception therapy

• Comprehensive SCS Platform with Illumina 3D™

Personalized therapy with neural targeting algorithm across broad IPG* and lead portfolio

• Cosman RF Ablation

Early stage treatment options for pain patients

• Vercise™ Deep Brain Stimulation Platform

First & only MICC*-based directional system

• International expansion

Under-penetrated market opportunity in both pain and brain

Market Size (2017E) ~$2.5B Market Growth (2017E) +14% 2017-2020

• est. Market

CAGR

+10%-15%

Preliminary

BSX 20171

Revenue Growth

+14%

*IPG: Implantable Pulse Generator; MICC: Multiple Independent Current Control

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15+ ongoing clinical research studies & RCTs3 to help prove personalized therapy is the future of pain relief:

Pain: Expanding a Winning Pain Portfolio and Leading with Rigorous Clinical Research

Illumina 3D™ Spectra™ SCS Systems Infinion CX™ Multiwave™ Cosman

Precision with Neural Targeting Algorithm Options for Patients (32 contacts, MRI compatibility2, Non- Rechargeable) Personalized Therapy Through Multiple Waveform Options Broadest Coverage of the Spine for Multi Therapy Targeting RF Ablation: Denervation

Strong cadence of technology with 2 new platforms expected to launch over next 24 months

• PROCO4 (Q2:17): Double-blind crossover RCT to evaluate the role of frequency on SCS patient outcomes
• WHISPER5 (Q1:18): Crossover RCT to evaluate the safety and effectiveness at sub-perception amplitudes
• ACCELERATE6 (H2:18): Crossover RCT to evaluate the safety and effectiveness at high-rate SCS
• VERITAS7 (2019): Prospective, multicenter study to evaluate the effectiveness of multiple modalities with

Spectra WaveWriter

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Challenges and Opportunities in SCS

Multiple recent studies (PROCO4, SUNBURST9) show patients respond variably to different therapies –

• Non-responders to one modality

may be responders to another modality

Expect multiple mechanisms of action involved

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Variation in Response

Opportunity to improve therapy longevity

• 3 - 6% annual explant rate due to

inadequate pain relief8

Recently launched modalities haven’t resolved loss of therapy issue

• 10 kHz: 5% annual explant rate due

to inadequate pain relief8

• Burst: 5% of patients with diminished
• r loss of symptom relief after 24

weeks9

• DRG*: 9% of patients experience loss
• f stimulation after one year10

Longevity of Therapy

*DRG: Dorsal Root Ganglion

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Spectra WaveWriter™ SCS System:

Multiple Therapies. One Device.

Maximize Responders:

• First system approved to simultaneously

provide paresthesia and sub-perception therapies

Simplify Personalization:

• Real-time patient rating and data on

waveform usage

Spectra WaveWriter System

Q1:18 US Launch

The Power of Combination Therapy with the Simplicity of Waveform Automation

Early Clinical Data – NANS 2018

Multi-site observational outcomes collection12 ∆ 6.0 reduction in NRS ~30 Day Follow Up

Significant Pain Reduction in Early Follow-Up

2 4 6 8 10 Baseline (N=79) End of Trial (N=69) Last F/u Visit (n=79) NRS Score (0-10)

Change in Overall Pain Scores (NRS*) at Last Follow-up

D = 6.0 (p < 0.0001)

*Numeric Rating Scale

7.7 2.0 1.7

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Spectra WaveWriter™ SCS System:

Multiple Therapies. One Device. Combination Therapy New Sub-perception Algorithms + Waveform Automation

Paresthesia Responders Sub-perception Responders

Multiple Therapies ~15% responder increase13

Designed for deeper, lasting relief by layering waveforms simultaneously or sequentially Competition

8-contact leads + Conventional Bi-Pole Limited Coverage

WaveWriter

Infinon CX (16 contacts) + Contour Multiple Vertebral Level Coverage

vs

Designed to easily find and keep the optimal target with a personalized stimulation field

+

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WHISPER & PROCO: Foundational Studies for Spectra WaveWriter™

PROCO RCT4

(de novo patients)

WHISPER RCT5

(previously implanted patients,

average ~4 years on therapy)

Key Takeaways

• Similar pain relief across 1, 4, 7 & 10 kHz
• 1/3 charge burden with 1kHz
• Neural dosing algorithms are critical

Key Takeaways

• <1.2 kHz delivered significant, long term,

sub-perception pain relief in a real world population

• Multiple therapies provide superior
• utcomes when patients are able to

choose most effective therapy

Spectra WaveWriter™

Next gen sub-perception technologies

• Contour™Algorithm
• Therapy Rater and Waveform Automation

Impactful clinical outcomes

• Exciting new data at NANS: WaveWriter

Observational Outcomes

• VERITAS Study (2019E)

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WHISPER RCT5: Multiple Therapies Provide Superior Outcomes

Challenging Patient Population

• WHISPER results

showed clinical value

• f SCS in challenging,

long-term, implanted patients

Positive Outcomes in Paresthesia Responders Superior Outcomes with Waveform Options

• Subgroup : ≥50%

improvement with supra- perception during crossover phase

• Outcomes consistent with

de novo PROCO RCT patients

• Met primary endpoint
• Superiority demonstrated
• 62% increase in responder rate

when patients are able to choose between multiple waveform options

Study Aspects WHISPER SENZA Patients Previously implanted Precision patients De-novo patients Mean duration of implant 4 +/- 1.9 yrs. 0 yrs. Duration of chronic pain 18.3 yrs. 13 yrs. Disability per Oswestry Disability Index 69.4 (Crippling) 54 (Severe) CRPS Yes (19%) No (0%)

1 2 3 4 5 6 7 8 Baseline Best Option (sub or supra) NRS Score (0-10) 7.2 2.5 n=20

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Supra-perception

• nly

Sub-perception

• nly

Best option (supra or sub) Responder Rate

29% 39% 47% n=70 62% increase

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Our History in Neuromodulation: A Different Path to Deep Brain Stimulation

Advanced Bionics technology, acquired by Boston Scientific in 2004

A heritage in cochlear vs pacemaker

• Utilization of multi-channel stimulation
• Precise control

Applying cochlear technology to neurological disorders

• Focus on stimulation modality
• Multiple Independent Current Control
• Focus on patient centric technology
• Wireless
• Rechargeable
• Ease-of-use
• Size
• Precision

DBS Vercise RC System (EU) 1st DBS system with 16 independent sources of current SCS Spectra Platform (WW) 1st 32 Channel Rechargeable Platform 2012 2004 SCS Precision Plus (WW) 1st and only MICC , 1st Rechargeable Platform

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Path to Leadership in Brain Modulation:

Differentiated Technology, Strong Clinical Evidence

MRI and personalized visualization

Next Generation System Vercise™ PC – First Directional System with

integrated Clinical Effects Map

Vercise™ Gevia™ – First MRI conditional

Rechargeable Directional System

Therapy Expansion Vercise™ - U.S. launch with

first and only MICC powered, rechargeable system, 8 level leads, and 5 years of proven therapy in Europe

2018 2019 2020+

Anticipate 18+3 ongoing clinical research studies will drive Brain Modulation to be a meaningful contributor:

• INTREPID14 (Q4:17) : First & only prospective, double-blind, sham-controlled, multi-center RCT;

evaluating Vercise™ DBS system for U.S. entry

• DBS Directional15 (2019): Evaluating therapeutic advantages of Cartesia™ Directional Lead with

Vercise™ PC DBS System

• DBS Registry16 (on-going): Comprehensive registry of real world outcomes to establish improvement

in quality of life

• Investments in indication expansion studies: Stroke rehabilitation, Alzheimer’s disease, depression,
• thers

U.S. expected launch timeline

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Revolutionizing Brain Modulation Therapy

BSX best-in-class system solution to meet market needs:

• High-growth, underpenetrated market
• ~$600M worldwide opportunity shifting away from a single player market
• BSX entering U.S. with compelling new technology
• System capabilities with potential to treat other neurological disorders

Vercise™ DBS Systems

Precision Control of Directionality with MICC

Brainlab

Advanced Surgical Planning

Visualization

Personalizes Programming for Patients

Smart Programming

Captures Outcomes

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Boston Scientific NANS 2018

WHISPER: A Multicenter, Prospective Randomized Controlled Trial Evaluating Sub-perception SCS at ≤ 1.2 kHz Friday, January 12 7:35AM - 7:45AM Forum Ballroom 14, 15, and 16 James North, MD Effects of Rate on Analgesia in Kilohertz Spinal Cord Stimulation: Final Results of the PROCO RCT Saturday, January 13 3:45PM - 3:55PM Octavius Ballroom 7, 8, and 9 Simon Thomson, MBBS FRCA FIPP FFPMRCA No Effects of High-Rate (Multi-kHz) Electric Fields on Brain Slice on Excitability Friday, January 12 7:15AM - 7:25AM Octavius Ballroom 5 and 6 Marom Bikson, PhD Artifactual Hyperpolarization During Extracellular Electrical Stimulation: Proposed Mechanism of High-Rate Neuromodulation Disproved Friday, January 12 7:25AM - 7:35AM Octavius Ballroom 5 and 6 Steven A. Prescott, MD PhD Dependence of c-Fos Expression on Amplitude of High-Frequency Spinal Cord Stimulation in an Animal Model Friday, January 12 4:45PM - 4:55PM Octavius Ballroom 7, 8, and 9 Robert Foreman, PhD A Computational Study of Dorsal Column Versus Dorsal Horn Modulation Using Higher Rate (≥250 Hz) Spinal Cord Stimulation Saturday, January 13 7:25AM - 7:35AM Forum Ballroom 14, 15, and 16 Tianhe Zhang, PhD

RCTs Basic Science and Mechanism Of Action DBS

DBS Registry: Outcomes and Safety E-Poster Deuschl, Vesper DBS Registry: Outcomes and Safety using the Directional Lead E-Poster Deuschl, Vesper

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Neuromodulation: Strong Growth Driven by Leading Innovation

• Exciting, large, underpenetrated and high-growth markets: SCS and DBS
• Strong start to 2018 with significant new FDA product approvals

– Spectra WaveWriter™ SCS System – WHISPER RCT sub-perception labeling – Vercise™ DBS System

• Pain: Defining the future of SCS through personalized therapy

– Broadest portfolio: neural targeting algorithms &waveforms, MRI, primary cell, 32 contacts, RF – Commitment to rigorous clinical and pre-clinical research: LUMINA17, PROCO4 , WHISPER5, ACCELERATE6 – Significant international expansion momentum and opportunity

• Brain: Poised for share gains with the most innovative platforms and U.S. market entry

– INTREPID14, VANTAGE18, CUSTOM19 data – Differentiated directional system supported by extensive clinical data – Integrated offering: Directional System, visualization, MRI, Brainlab partnership

• Convergence of technology and clinical insights unlocking new treatments for

neurological disorders (stroke rehabilitation, Alzheimer’s disease, depression and others)

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References

1) Neuromodulation reported revenue growth based on preliminary, unaudited sales results issued January 9,

• 2018. Results are preliminary and subject to completion of year end financial reporting processes, reviews and

audit. 2) 1.5 Tesla MRI conditional when all conditions of use are met 3) Includes company and investigator-sponsored research studies 4) Effects of Rate on Analgesia in Kilohertz Frequency Spinal Cord Stimulation: Results of the PROCO Randomized Controlled Trial. Simon J. Thomson, MBBS, et al. Neuromodulation, November 2017 5) North, J., et. al. WHISPER: A Multicenter, Prospective Randomized Controlled Trial Evaluating Sub-perception SCS at ≤ 1.2 kHz. NANS 2018, Las Vegas 6) Safety and Effectiveness Study of the Precision SCS System Adapted for High-Rate Spinal Cord Stimulation (ACCELERATE) NCT02093793 7) Value of Multiple Modalities Using the Spectra WaveWriter Spinal Cord Stimulator System (VERITAS) NCT03251937 8) Therapy-Related Explants After Spinal Cord Stimulation: Results of an International Retrospective Chart Review

• Study. Dr. Jean-Pierre Van Buyten, MD; et al Neuromodulation, October 2017

9) Proclaim™ Implantable Pulse Generator CLINICIANS MANUAL, 2016-04 ARTEN100125494B 10) PREDICT: A prospective post-market trial to evaluate DRG stimulation for the management of chronic intractable pain. S. Eldabe,, MD; et al. INS 2017 11) Rauck, R. PET Study. NANS 2015, Las Vegas 12)Metzger, C., et. al. Outcomes Using an SCS Device Capable of Delivering Combination Therapy (Simultaneous

• r Sequential) and advanced waveforms/field shapes. NANS 2018, Las Vegas

13)Thomson et al., PROCO RCT, INS 2017

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References

14) Deep Brain Stimulation (DBS) for the Treatment of Parkinson's Disease (INTREPID) NCT01839396 15) Directional Data:

• Steigerwald et al. “Directional deep brain stimulation of the subthalamic nucleus: a pilot study using a

novel neurostimulation device.” Movement Disorders. 2016;

• Reker et al, “Directional deep brain stimulation: A case of avoiding dysarthria with bipolar directional

current steering: Parkinsonism and Related Disorders 2016 Aug

• “Scientists Test Next Generation Deep Brain Stimulation Leads to Improve Targeting the Subthalamic

Nucleus with Fewer Adverse Effects” NEUROLOGY TODAY | Jul 2016 16) Registry of Deep Brain Stimulation With the VERCISE™ System: Vercise DBS Registry NCT02071134 17) Veizi et al, “SCS with Anatomically Guided (3D) Neural Targeting Shows Superior Chronic Axial Low Back Pain Relief Compared to Traditional SCS.” Pain Medicine Jan 2017. 18) Vantage:

• 1 Year: Timmermann et al., Multiple-source current steering in subthalamic nucleus deep brain

stimulation for Parkinson’s disease (the VANTAGE study): a non-randomised, prospective, multicentre,

• pen-label study Lancet Neurology 2015; 14: 693–701
• 3 Years: Timmerman et al, “Three-Year Outcomes of a Prospective, Multi-center Trial Evaluating Deep

Brain Stimulation With a New Multiple-Source, Constant-Current Rechargeable System in Parkinson Disease.” Neurosurgery. Aug 2016. 19) CUSTOM-DBS: Volkmann et al., Presented at 2014 Annual Meeting of the International Parkinson and Movement Disorders Society, June 2014