Boston Scientific

Moat components and weights we consider most relevant for large‑cap medtech: Switching costs 35%, Intangibles 30%, Cost advantage 20%, Efficient scale 10%, Network effects 5%.

Switching costs (80/100): Interventional cardiology and electrophysiology are characterized by physician training, workflow integration, and hospital contracting that create real friction to switch.

FARAPULSE adoption benefits from a simplified, reproducible procedure profile and learning curve, and WATCHMAN’s installed base and training ecosystem reinforce stickiness. FDA approvals and labeling expansion for FARAPULSE into persistent AF deepen entrenchment.

Intangible assets (85/100): Regulatory approvals, clinical data (ADVENT, MANIFEST), and brand equity in WATCHMAN and FARAPULSE form substantial intangible protection. The OPTION study and reimbursement changes enabling concomitant ablation plus LAAC add evidence and economic logic that favor Boston Scientific’s franchise.

Cost advantage (75/100): Global scale across manufacturing, distribution and a broad call‑point footprint lower unit costs and selling costs per procedure. Scale also enables Boston Scientific to bundle offerings across cardiovascular, endoscopy, and urology.

The company reports strong gross margins and continued operating leverage as PFA and LAAC scale. Efficient scale (70/100): In LAAC, WATCHMAN competes primarily with one major rival, and in PFA the field is consolidating around a few platforms as clinical and regulatory hurdles rise.

J&J’s temporary U.S. rollout pause of a competing PFA system underscores category barriers; FDA’s expanded labeling for FARAPULSE widens Boston Scientific’s addressable use cases.

Network effects (40/100): Limited direct network effects; indirect effects arise from growing trained user communities and ecosystem software like FARAVIEW and mapping integrations, but these are weaker than in classic networks. Net outcome: a composite moat with multiple, mutually reinforcing elements, strengthened by portfolio focus.

We adjust the score down modestly for product‑safety and regulatory risk, as seen in the 2024 POLARx cryo balloon recall classification and the 2025 global TAVR exit.