Boston Scientific Corp. (BSX) said it will settle a patent dispute with Johnson & Johnson Inc. (JNJ) for $716 million. The lawsuit involves patents covering medical devices known as stents, tiny mesh tubes that are used to prop open diseased heart arteries.
The payment is within Boston Scientific’s legal reserves and will be made from cash on hand.
“We are pleased we have been able to significantly reduce the amount of outstanding litigation we have with Johnson & Johnson,” said Chief Executive Ray Elliott, adding the company will continue to work on resolving other suits.
The medical-device maker has been involved in myriad intricate legal moves over stents, involving the major players in the $4 billion market: J&J, Medtronic Inc. (MDT) and Abbott Laboratories (ABT). The companies have sued to prevent competitors from introducing new stents and to claim royalties on each other’s devices.
“We are pleased to resolve several of these patent litigations,” said Seth Fischer, chairman of Cordis Corp., the J&J unit involved in the suit.
J&J expects to record most of the settlement payment as a special item in the fourth quarter.
Other companies also have been working to resolve the litigation. In July, Medtronic said it would pay Abbott $400 million to settle all patent fights between the companies and clear the air regarding stents. That followed deals Medtronic reached earlier this year to resolve stent-patent disputes with both Boston Scientific and J&J.
J&J’s Cordis unit said the settlement includes U.S. and Canadian lawsuits — 14 in all — primarily involving older stents and equipment used in angioplasty procedures.
Coronary stents are tiny mesh tubes used to prop open arteries that have been cleared of blockages via angioplasty.
