Preparing for Compliance with the New MA Pharmaceutical

Preparing for Compliance with the New MA Pharmaceutical and Medical Device Code of Conduct Law January 23, 2008 Rupa M. Cornell Director, SEC Compliance and Corporate Counsel 1

Agenda • Overview of Boston Scientific Corporation • Compliance Challenges • Approaches to Compliance • Key Tactics for Compliance • Summary

Boston Scientific Corporation Profile • Founded in 1979 with 38 employees and $2 million in sales • 25, 000 Employees • Now a global leader in cardiovascular medicine and one of the world’s largest medical device companies • Dedicated marketing and sales force in more than 45 countries • Portfolio of approx. 13, 000 products, many with market leading positions • The TAXUS® drug-eluting coronary stent was the most successfully launched product in the history of the industry • Added Cardiac Rhythm Management Group through acquisition of Guidant Corporation in April 2006 3 • Over 2, 000 in MA • 37 manufacturing, distribution and technology centers worldwide • Corporate HQ: Natick, MA • Regional HQs: Paris, Tokyo, Singapore • Website: www. bostonscientific. com

Boston Scientific’s Mission Statement Boston Scientific’s mission is to improve the quality of patient care and the productivity of health care delivery through the development and advocacy of less-invasive medical devices and procedures. This is accomplished through the continuing refinement of existing products and procedures and the investigation and development of new technologies that can reduce risk, trauma, cost, procedure time and the need for aftercare. 4

Broad and Deep Portfolio of Over 13, 000 Products Sampling of Boston Scientific’s Product Portfolio Stents Catheters / Guidewires Embolic Protection Ultrasound Imaging Pacemakers / ICDs Ablation Peripheral Dilatation Detachable Coils Neurostimulation Biopsy Systems 5 Balloons Embolics Stone Retrieval Lithotripsy Systems Enteral Feeding

Boston Scientific is Organized into Five Businesses International Cardiac Rhythm Management Cardiovascular Endosurgery Neuromodulation Americas Interventional Cardiology Endoscopy Europe/ Middle East/ Africa Asia / Pacific Electrophysiology Peripheral Interventions Neurovascular Grou p Business 6 Urology Gynecology Japan

MA Statute – Compliance Challenges • Broad statutory language • “Bona Fide Services, ” “Covered Recipients” and “Health Care Practitioners” • Clinical trials and R&D included as part of Sales and Marketing activities? • Vague language • Fifty dollar threshold in aggregate or per transaction? • Discounts and rebates • Incomplete regulations 7

Possible Approaches • Broad approach to overall Health Care Practitioner (HCP) compliance taking Federal, state, local level laws into account • Focused MA-only approach 8

BSC Approach – HCP Project • Boston Scientific is approaching HCP compliance broadly • HCP Project Team • Focused on our policies, systems and processes involved in planning, approving, monitoring, controlling, compiling and reporting HCP payments/relationships • To ensure compliance with legal requirements, as well as with desired standards of conduct • Key to staff project with leadership and team, and identify and budget sufficient resources 9

BSC Approach- HCP Project • Comprehensive workplan that addresses near term HCP program requirements, and anticipates long term requirements • Closely align required HCP project workflows with project teams, with defined objectives/deliverables • Develop cross- functional teams, with subject matter experts, as well as those who use the systems, processes and policies on a dayto-day basis • • 10 Develop a program that is compliant and works Smooth implementation for company and HCPs

Key Tactics - MA Since regulations are not yet final and statute remains broad and vague, gather all possibly relevant data and refine once regulations are final • • Continue vigilant lobbying efforts until regulations are finalized 11

Key Tactics - MA • Information Technology is INTEGRAL & CRITICAL • Information Technology Considerations: • • Working across multiple business unit/payment systems, for consolidation or common data warehouse possibilities • Systems to track travel and expenses and other spending sufficient detail captured to comply with MA statute • System controls and tools to ensure compliance with requirements • 12 Identification of MA HCPs who fall within statutory requirements – consider outside vendor for databases Online training for various groups across your organization

Key Tactics – MA • Define scope and elements of compliance, considering: • US vs. Global application • Identification of applicable ethical codes, Federal, state, local laws • Anticipate future requirements to identify long term requirements/functionality that may be required • Plan project and workflows • Understand company’s current state • Define expected end state • Identify steps required to bridge from current state to expected end state • 13 Consider use of outside resources/advisors to assess current policies and procedures and recommended changes

Key Tactics - MA • Tee up key people and resources now • Leadership • Staffing • Budget • Develop appropriate cross-functional teams • • Compliance • Marketing • Sales • Communication • Executive Management • 14 Legal Clinical

Key Tactics - MA • Rolling Communication Plan • Timing is critical • Communicate on a high level now (e. g. , National Sales Meetings) • Be prepared to provide more specific communication as soon as the regulations are final • • 15 Training Break-out sessions

HCP Project Workflow Example of HCP Project Workflow Teams to address MA law or broader HCP initiative Policies, Procedures & Work Instructions Federal, State & Local Requirements Management Processes & Controls HCP Compliance Sustaining Compliance Documentation Training & Communications 16

Summary • Be proactive – the time to act is NOW, even though regulations aren’t final • Consider an approach that allows expansion/modification of MA compliance measures to meet other states, and likely Federal, law • Communication and training are key

Thank You Questions 18