Company: BSX
Filing Date: 2025-02-18
Form Type: 10-K
Source: 0000885725-25-000011
Chunk: 90

Company: BOSTON SCIENTIFIC CORP
Filing Date: 2025-02-18
Form: 10-K
Item: Item 7
Chunk 90
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 inventory charges and other period expenses(1.6)%Year Ended December 31, 202468.6%

The primary factors contributing to the decrease in our gross profit margin for 2024 compared to 2023 were inventory charges, including related to the POLARx™ cryoablation system given the strong commercial adoption of our Farapulse™ Pulsed Field 

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Ablation System, strategic manufacturing capacity investments and other period expenses, partially offset by increased sales of higher margin products.

The primary factors contributing to the increase in our gross profit margin for 2023 compared to 2022 were increased sales of higher margin products, as well as improvements in manufacturing, raw material and component, and freight costs, partially offset by the unfavorable impact of foreign currency and period expenses. 

EU MDR Implementation Costs 

The EU MDR replaced the existing European Medical Devices Directive (MDD) and Active Implantable Medical Device Directive (AIMDD) regulatory frameworks, and manufacturers of medical devices were required to comply with EU MDR beginning in May 2021 for new products and by May 2024 for medical devices that have a valid CE Certificate to the Directives issued before May 2021. In 2023, updates to the legislative text of the EU MDR were adopted by the European Parliament and the Council of the European Union, including an extension of the transitional period to 2027 for certain high risk class devices and 2028 for lower risk class medical devices that have a valid CE Certificate to the Directives issued before May 2021.

We began our EU MDR implementation efforts in late 2019 and have incurred cumulative expenses of $408 million through December 31, 2024, which are primarily being recorded within Cost of product sold. We expect to incur total expenses of approximately $450 million to $500 million over the transition period. 

Operating Expenses

The following table provides a summary of our key operating expenses:Year Ended December 31, 202420232022(in millions)$% of Net Sales$% of Net Sales$% of Net SalesSelling, general and administrative expenses$5,984 35.7 %$5,190 36.4 %$4,520 35.6 %Research and development expenses1,615 9.6 %1,414 9.9 %1,323 10.4 %

Selling, General and Administrative (SG&A) Expenses

In 2024, our SG