Guidant name fading into history

WASHINGTON -- Boston Scientific Corp. will rename Guidant Corp.'s heart-rhythm unit after its $27 billion acquisition of Guidant is completed next month, a move marketing experts said should be carefully studied.

Boston Scientific's chief financial officer, Larry Best, said the name change would improve Guidant's flagging image with its primary customers, physicians. Marketing consultants, though, said such changes can carry great weight.

''If you change the name, people think the product is changed," said Al Ries, chairman of Atlanta marketing firm Ries & Ries and the author of a book on branding.

Any change might anger patients with Guidant implants in their chests, said Craig Binkley of Atlanta-based Zyman Group marketing consultants. They might feel they are carrying an obsolete product, he said.

Guidant sales fell sharply last year after the second-largest maker of implantable electronic cardiac devices recalled 109,000 defibrillators linked to seven deaths. Many cardiologists switched to the other two makers, market leader Medtronic Inc. and St. Jude Medical Inc.

Indianapolis-based Guidant said fourth-quarter earnings fell 24 percent because of recalls last year. Sales of profitable implantable defibrillators dropped 19 percent in that period. A wave of lawsuits, state investigations, negative media coverage, and US regulatory sanctions followed.

Boston Scientific said chief executive Jim Tobin will focus on rehabilitating Guidant's profitable defibrillator and pacemaker sales. The name change will be the most visible evidence of that, Best said.

''It will become Boston Scientific Cardiac Rhythm Management," Best told an investor conference yesterday in Boston. ''It will have a new face and a fresh start."

Implantation physicians see little difference in quality among the three makers of the devices, but patients are concerned about recalls, according to a survey by Cowen analyst Dhulsini de Zoysa in New York.

Natick-based Boston Scientific is poised to challenge Medtronic for leadership in medical devices. The worldwide market for implantable defibrillators and pacemakers is about $10 billion.

Best said the merger will transform Boston Scientific into a medical devices titan with double-digit revenue and profit growth for years to come.

Along with the market for interventional cardiology products, such as stents used to treat heart disease without surgery, the total market will be $19 billion, and Boston Scientific's 35 percent share of it will be number one, Best predicted.