Thank you, Tanya. Good morning everyone and thank you for joining us this morning.

With me on the call today are Ray Elliott, President and Chief Executive Officer, and Jeff Capello, Executive Vice President and Chief Financial Officer. We issued a press release yesterday afternoon announcing our second quarter results.

Key financials are attached to the release including the reconciliation of non-GAAP financial measures used in the discussion and we have posted a copy of the press release as well as support schedules to our website. The agenda for this call will include a review of the second quarter financial results including third quarter and full year 2010 guidance from Jeff, an update on our business performance in the quarter from Ray followed by his perspective on the quarter overall quarter.

We will then open it up to questions. During the question-and-answer session today, we will be joined by Sam Leno, Executive Vice President and Chief Operations Officer; Hank Kucheman, Executive Vice President and Group President CRV; Mike Phalen, Senior Vice President and President of our Endoscopy business; John Pedersen, Senior Vice President and President of our Urology and Women's Health business; Joe Fitzgerald, Senior Vice President, and President of our Endovascular unit; Michael Onuscheck, Senior Vice President and President of our Neuromodulation business; Dr.

Ken Stein, Chief Medical Officer for CRM; and Dr. Keith Dawkins, Chief Medical Officer for our CRV Group.

Before we begin, I'd like to remind everyone of our Safe Harbor statement. This call contains forward-looking statements including statements regarding our expected market share growth projections, new product approvals, acceptance and sales, our financial position, expected net sales, earnings and tax rates for 2010, the effect of our restructuring activities, the effect of our debt repayment and expected FDA approvals.

The company wishes to caution the listeners that actual results may differ from those discussed in forward-looking statements and maybe affected by among other things, risks associated with our financial performance, our restructuring plan, clinical trial results, our programs to increase shareholder value, new product development and launches, regulatory approvals, litigation, our tax position, our competitive position, our growth strategy, the company's overall business strategy and other factors described in the company's filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made and we undertake no obligations to update any forward-looking statements.

I will now turn it over to Jeff for a review of the financial results for the quarter. Jeff.

Thanks Larry. Let me start by providing you with a detailed review of the operating results for the quarter.

Consolidated revenue for the second quarter was $1.928 billion versus our guidance range $1.825 billion to 1.925 billion, and represents a 7% reported in constant currency decline in the second quarter of last year. Compared to the positive contribution of $25 million assumed in our second quarter guidance range, foreign exchange contributed only a positive $4 million to our second quarter sales results, which negatively impacted our reported revenue by $21 million.

We estimate the defib ship hold and product removal actions lowered our revenue growth rate by approximately 300 basis points or $62 million in the quarter compared to our guidance estimate of $127 million due to the strong execution of our stop shift recovery plan. Ray will provide a broader overview of our businesses by major product category, but I’ll address our sales results for all of our businesses at a high level here.

Worldwide DS came at $389 million at the high end of our guidance range of $355 million to $399 million and down 12% both on reported and constant currency basis from the second quarter 2009. Our worldwide DS revenue includes a $128 million for TAXUS, $210 million for PROMUS and $51 million for PROMUS Element.

Our worldwide TAXUS, PROMUS, PROMUS Element split from the quarter was 33-54-13. We continue to sustain our worldwide DS leadership during the second quarter with an estimated global market share of 38% which we estimate to be about 10 percentage points higher than our nearest competitor and 4 percentage points lower than our share in Q2 ‘09 principally impacted by DS share movements including the introduction of new stents principally in Japan.

US DS revenue is $209 million at the high end of our guidance range of $190 million to $210 million and 12% lower in the second quarter of last year. Excluding the favorable impact of a $7 million adjustment to the sales transition reserve included in Q2 ’09, US DS sales were down 9% versus last year driven by TAXUS share loss.

This includes $73 million of TAXUS and a $136 million PROMUS revenue and represents a 35-65 mix of TAXUS and PROMUS in the US compared to a 47-53 mix in Q2 of ‘09. We estimate that our US DS share was 46% for the quarter with 16 share points of TAXUS, 30 share points of PROMUS.

Excluding the transition recorded in ’09, our total share is down three points compared to the second quarter of last year. The decline in market share year-over-year is consistent with our expectations given the results of the compared study which released in September of last year.

On a sequential basis, our market share of 46% was flat with the first quarter of this year indicating that our share has stabilized as we enter the third quarter which is the last difficult US quarter for comparisons given the compared results. We continue to maintain drug-eluting stent market share leadership in a very competitive US market with more than 17 more market share points than our nearest competitor.

Based on our estimate of US market for the second quarter, we believe that Boston Scientific’s market share was 46% for the second quarter estimated between 47% to 48%. And Abbott share was approximately 29%, while J&J and Medtronic achieved approximately 13% and 12% respectively.

International DS sales of $108 million were at the high end of our guidance range of 165 to 180 and represents a decrease from prior year of 12% on both the reported basis and constant currency basis. This includes $55 million in TAXUS, $74 million in PROMUS and $51 million in PROMUS Element.

And represents a 31-41-28 mix of TAXUS, PROMUS, PROMUS Element. PROMUS Element contributed $51 million to our international DSOs including $39 million in EMEA and $12 million in the Americas and Asia-Pac combined.

We estimate that Boston Scientific’s DS market share in EMEA for the second quarter was 32% which is down three points compared to the second quarter of 2009. TAXUS market share was approximately 10% with revenue of $24 million.

PROMUS market share was approximately 6% with revenue of $14 million and PROMUS Element market share was approximately 16% with revenue at $39 million. Together this represents a TAXUS, PROMUS, PROMUS Element mix in EMEA of 31-18-51.

We continue to be very pleased with the market acceptance of PROMUS Element which is running ahead of plan to the products market leading alloy and stent design which improve ease of use. The recent launch of TAXUS Element on the same leading edge stent platform is expected to offset the current TAXUS share erosion.

The combination of the continued rollout of PROMUS Element and TAXUS Element will position us to begin to take share on a year-over-year basis during the second half of the year. Our DS share in Japan was 38%, down 15 points from the second quarter of 2009 with revenue of $50 million, driven primarily by the number of accounts participating in the Abbott reset trial, and a challenging pricing environment and by the introduction of additional competitive drug-eluding stent platforms.

TAXUS market share was approximately 7% with revenue of $9 million. And PROMUS market share was approximately 31% with revenue of $41 million.

Together this represents a TAXUS PROMUS mix in Japan of 18-82. During the quarter, we estimate Xience share at 42%, Endeavor at 8%, and J&J share at 12%.

As we discussed last quarter, the reset trial is expected to complete enrollment around the end of July. This will provide us with an opportunity to leverage our commercial strength and two drug platform to reenter these accounts as we look to regain some share in the back half of the year.

We estimate our Asia-Pacific DS share remain steady at about 17% during the second quarter, split 7% TAXUS with $ 11 million in revenue, 5% PROMUS with $8 million in revenue and 5% PROMUS Element with $9 million in revenue or a TAXUS PROMUS PROMUS Element mix of 39-29-32. DS sales in our Americas international region were $25 million, representing approximately 54% market share with 23% or $11 million in TAXUS revenue, 23% or $11 million in PROMUS revenue and 8% or $3 million in PROMUS Element.

This represents a 44-44-12 mix of TAXUS, PROMUS and PROMUS Element. In summary, with global DS market share of 38%, we maintain 10 percentage points of share advantage over our nearest competitor.

Our strong commercial team focused on the only two drug platform in the industry, coupled with the rollout PROMUS Element and TAXUS element, stents will allow us to increase our market share leadership going forward. I would like to provide you a little more detail on the drug using stents market dynamics during the quarter.

We estimate the worldwide DS market in Q2 at approximately $1,035 million which is flat from reported end constant currency revenue versus Q2 ’09 excluding the impact of $7 million of revenue recorded to replenish customer on inventory as a result of the launch of TAXUS Liberte. Our estimated worldwide market revenue in the quarter includes a worldwide unit volume increase of approximately 10% driven by an increase in both PCI volume and penetration offset by worldwide market decline in average selling prices of approximately 9% constant currency, also down 9% in actual reported.

Global penetration rates increased 3% versus a year ago. The US PS market is estimated to be about $456 million for the quarter representing a decrease of approximately 3% from the second quarter of last year, excluding the impact of sales transition reserve reversals in Q2 of last year.

This consists of a unit volume increase of approximately 6% which includes an increase in PCI volume and an increase in penetration. This unit volume increase was offset by approximately 8% decline in ASPs including a negative mixed shift of DS platforms.

During the quarter we saw our US DS ASP reductions in line with the aggregate market declines with TAXUS down about 8% and PROMUS about 9% compared to the second quarter of 2009. US PCI volume in the quarter was approximately 260,000 procedures, up 2% compared to the second quarter of 2009.

We estimate that the US PS penetration of 78% was up 3 percentage points over the second quarter of 2009. Combined with stented procedure rates and stents per procedure we estimate that the total unit market of US stents in Q2 was approximately 347,000 units including 270,000 units of DS.

The international DS market remained strong for the quarter with approximately 608,000 PCI procedures including 350,000 procedures in EMEA, 57,000 procedures in Japan, 138,000 procedures in Asia-Pacific and 64,000 procedures in the Americas. We estimate that international DS penetration of 59% was up 3 percentage points over the second quarter of 2009 including 56% in EMEA, 73% in Japan, 74% in Asia-Pacific, 35% in the Americas.

Worldwide, Q2 CRM revenue at $527 million represents a reported decrease of 13% and a constant currency decrease of 13% versus $609 million reported in the second quarter of 2009. For the second quarter, we estimate that being off the US market for the first 11 selling days in the quarter and subsequent ramp up of our sales as a result of the defib ship hold and product removal actions reduced our US CRM revenue by $62 million.

This compares very favorably with our previous estimate of $127 million lost sales for the quarter. Our commercial organization led by the sales team did an excellent job responding to the recovery plan which allowed us to ramp sales back up in two weeks versus our previous forecast of six weeks which drove most of the benefit.

While we were being cautious on the outlook for the remainder of the year, given our previous assertions requiring multiple quarters to see the full potential impact, we were very pleased with the results of the second quarter. US CRM revenue of $322 million represents a 20% decrease of the prior year for the quarter principally impacted by the defib ship hold.

International sales of $205 million in the quarter represented a reported increase of 1% from the prior year and up 3% constant currency. World wide ICD sales of $379 million exceeded the high end of our guidance range of $293 in the quarter driven by an execution of the defib stop ship recovery efforts.

This represents a reported decrease of 17% from Q2 ‘09 and a constant currency decrease to 15%. ICD sales in the US were $238 million above our guidance range of $160 to $180 representing a 24% decrease from last year.

International ICD sales for $141 million were near the higher end of our guidance range of $130 to $145 representing in 1% reported increase from last year, up 7% in constant currency excluding deferred revenue related to the launch of Latitude in Europe last year. The growth in internationally ICD area is being driven by strong market acceptance of our cognizant intelligent products as we continue to roll out these products in other areas of the world.

Excluding sales from our five non core divested businesses are non-DS and non-CRM worldwide revenues decrease approximately 1% compared to the second quarter of last year to $1.01 billion and were down approximately 2% in constant currency terms. On our world wide basis, our Endoscopy business group 8% in constant currency terms, broad based strengths across all geographies driven by new product introductions and very strong sales execution.

This is the fourth quarter in a row of high single digit to double digit revenue growth which is just terrific performance. Our urology/ Women’s Health business grew 4% in constant currency terms including a few product issues in our oncology and BPH areas which depressed the growth rate by approximately 350 basis points.

Strong growth continues in our Women’s Health business as we continue to introduce new products in the area of pelvic floor and abnormal uterine bleeding. Within the quarter, our neuromodulation business was flat year-over-year despite growing 10% in the first quarter.

We believe that the continued softness in the economy which appeared to weaken the market growth rate in the first quarter has accelerated. We expect to learn more about the market as competitors announce their results.

At this point, we remain optimistic that we will see return to growth in second half as patient deductibles are utilized and we introduce new technology. For the rest of the businesses, electro physiology was flat, peripheral interventions was down 4%, non-stent interventional cardiology was down 7%, and neurovascular was also down 6%.

We continue to see a lag in these businesses as a result of later than planned new product launches, competitive product launches, some procedural softness and pricing pressures, especially in non-stent interventional cardiology. However, given the number and types of new product launches, we expect growth in these divisions to begin in the second half of the year.

Ray will talk more about some of the new product launches in these businesses in a few minutes. Reported gross profit margins for the quarter were 66.1%.

Adjusted gross profit margin for the quarter excluding construction related charges was 66.7%, which was 350 basis points lower than the second quarter 2009, or within our previously issued guidance range. Excluding the impact of the ship hold and product removal actions taken at the end of the first quarter, adjusted gross margin would have been 67.5%.

The primary contributors to the 350 basis point reduction from last year include the shift in DS mix from TAXUS to PROMUS during the quarter. Lower DS share and pricing pressure in both US and Japan as well as the impact of the defib ship hold and product removal actions partially offset by the increase in PROMUS Element sales in Europe.

Our gross margin percent will continue to be pressured as a result of negative DS mix shifts from TAXUS to PROMUS, as well as lower overall market shares, and lost CRM market share resulting from our recent ship hold actions. We continue to see the profit margin benefit for selling PROMUS Element instead of PROMUS in Europe.

However, the recent launch of PROMUS in Japan and the strategy being followed by some competitors is creating an adverse mix of TAXUS/PROMUS compared to 2009. Our reported SG&A expense in the second quarter were $634 million.

Adjusted SG&A expenses excluding restructuring related items were $633 million or 32.8% of sales compared to 32.2% in Q2 2009. As we told you during the first quarter the ship hold and product removal actions during the first quarter did not have an impact on our total SG&A dollars but did put upper pressure on the SG&A as a percentage of sales as we put plans in place to keep our sales reps compensation whole during the time we were off the market with our defib products.

Our SG&A as a percent of sales was slightly lower than the guidance we provided during the first quarter call due to the favorable impact of restructuring savings, the timing of certain expenditures and the incremental revenue from a faster defib stop shift recovery. We do expect to see an increase in the level of spending over the back half of the year given both the timing of the expenditures in the second quarter and a decision to make incremental investments in top line growth opportunities in both customer facing and development related positions, including specific initiatives in the emerging markets, all of which are aimed at improving our growth.

Both reported and adjusted research and development expenses were $232 million for the quarter or 12% of sales. Reduction during the quarter is related to the timing of some of our restructuring efforts and a delay or slower start in terms of our clinical trials.

We are also in the process of reallocating dollars within our total R&D portfolio to the development projects we intent to focus on going forward. This is part of our restructuring plans and the increase investment intent to make an identified poor growth there is going forward.

We continue to look to invest approximately $1 billion in R&D on an annual basis. We reported GAAP pre-tax operating income of $231 million for the quarter.

On an adjusted basis excluding a goodwill adjustment, restructuring charges and amortization expense, adjusted operating income for the quarter was $365 million and 18.9% of sales, down 320 basis points from Q2 '09. The reduction versus Q2 '09 is primarily related to gross margin deterioration.

I would like to now highlight the GAAP to adjusted operating profit reconciling items in little bit more detail for you. We reported a $31 million non-cash credit connection with the finalization of our interim goodwill impairment test performed as of March 31.

When offset against the initial $1.848 million non-cash estimate we recorded in the first quarter, our final impairment charge totaled $1.817 million. We recorded $41 million pre-tax or $29 million after-tax of restructuring-related charges in the quarter which are primarily related to severance and certain other costs in connection with the previously announced 2010 restructuring plans.

Total amortization expense was $124 million pre-tax or $94 million after-tax which is $2 million lower with the second quarter of '09. For the remainder of 2010, our quarterly amortization expense should remain at this level.

The cumulative effect of all these items was a $134 million pre-tax and $92 million after-tax. Interest expense was $103 million in the quarter or $11 million higher than Q2 '09, which primarily represents non-cash interest expense of $11 million resulting from prepaying in $900 million Abbott loan and accelerating debt issuance cost related to refinancing our revolving credit facility.

Our average interest expense was 6.4% in Q2 2010 compared to 5.5% Q2 '09. Excluding the debt repayment and refinancing cost, our average interest expense rate in Q2 2010 was 5.7%.

Other net, it was $9 million of expense from the second quarter compared to $3 million of expense in Q2 2009. For the second quarter of 2010, other net included $1 million dollars of interest income offset by 10 million of other expenses primarily related to currency exchange costs resulting from significant market volatility.

Interest income in the quarter was $1 million lower then Q2 2009 due to a lower average cash balance and a lower rate of return on investments. As a reminder interest income of $2 million in Q2 2009 was offset by $5 million of miscellaneous expense.

Our reported GAAP tax rate for the second quarter was 18% and on an adjusted basis our tax rate was 25%. Our adjusted tax rate for the second quarter reflected a 140 basis point unfavorable impact or a $3 million for discrete tax as well as 160 basis points of an unfavorable timing events which are reversing from the previous quarter.

Adjusting for both the discrete benefit and the unfavorable timing items, we had an operational tax rate in the second quarter of approximately 22%. We currently expect our full year operational tax rate to be approximately 19%, inclusive of the US R&D tax credit or two points lower then our previous guidance of 21%.

Including the net favorable income of the discrete benefit and the timing items that occurred from the first quarter and offset by the unfavorable discrete and timing items in the second quarter, our adjusted rate is estimated to be between 17% and 18% for the full year. The decrease in the expected full year operational rate from our original guidance is due to the revised expectations of our geographic mix of earnings and it is reflected in our second quarter operation tax rate.

In addition, our operational tax rate for the second quarter excludes US R&D tax credit as it has not yet been reacted for 2010. As a result of a revised pretax profit projections, the R&D tax credit decreased to 300 basis points on an operational effective tax rate.

We reported GAAP EPS for the second quarter of $0.06 per share compared to $0.10 per share in the second quarter of last year. GAAP results for the second quarter included the previously discussed amortization and restructuring charges along with adjustment to our Q1 goodwill impairment charge.

Our adjusted EPS in the second quarter which excludes these items was $0.12 and was above the high end of our guidance range of $0.06 to $0.10 per share driven principally by our performance and recovery to the defib ship hold. Our adjusted EPS for the second quarter was down $0.08 versus our adjusted EPS of $0.20 in the second quarter of 2009.

As a reminder the second quarter of 2009 adjusted EPS excluded $0.07 per share of amortization, $0.02 per share was restructuring related charges, $0.01 per share of acquisition-related charges, $0.01 per share of intangible asset and impairment and discrete tax items of a $0.01 per share. Stock comp was $36 million and all per share calculations were computed using 1.5 billion shares outstanding.

DSO was 62 days, a one day improvement from the second quarter 2009 driven by stronger cash collections in US, EMEA and Japan. Days inventory in hand were 123 days, down 4 days from Q2 2009 as we continue to work on reducing our inventory levels despite the required investments to support our new product introductions.

Reported operating cash flow in the quarter was $286 million compared to $419 million in Q2 2009. Q2 2010 cash flow included $34 million of restructuring payments and $6 million of legal settlement payments.

The Q2 2009 cash flow included $74 million of legal settlement payments and $24 million of restructuring payments. Excluding these items, Q2 2010 operating cash flow was $326 million or a $191 million lower than Q2 2009 primarily due to lower adjusted operating profit, lower collections largely due to the 30-day, CRM ship hold and a reduction of accounts payable balances.

Capital expenditures were $61 million in the quarter and $8 million lower than Q2 2009. Reported free cash flow was $225 million in the quarter compared to $345 million Q2 2009.

At the end of the second quarter, we had $811 million of cash on hand, $6 billion of total debt, and net debt of $5.2 million which is comparable to Q2 2009. In addition, in early July we received a tax refund check of $161 million, associated with recent legal settlements, which increased our cash position to roughly $1 billion.

In June, we successfully syndicated a $1 billion dollar three-year term loan, and a new $2 billion dollar three-year revolving credit facility to replace our $1.75 billion revolving credit facility maturing in April of 2011. We used the term loan proceeds to immediately repay the $900 million loan due to Abbott Laboratories in April 2011.

We expect to use a portion of the revolving credit facility together with cash on hand to repay our 850 million senior notes maturing in June of 2011. These actions strengthen our capital structure and provide enhanced capacity on acquisitions and other investments in technologies that deliver the most innovative solutions to physicians and patients.

The refinancing also enhanced our liquidity, as we currently have more than $2.3 billion available equity, including cash on hand and our available credit facilities. In addition, we expect to generate strong cash flow in 2010 of approximately $1.7 billion, before special items.

Further, a new revolving credit facility provides for increase in the maximum permitted leverage ratio of 3.85 times through March 31st 2011 and 3.5 times hereafter. Our debt EBIDTA credit facility covenant ratio was 2.58 times as of Q2 2010, well below the maximum permitted level representing $770 million of EBIDTA safety margin.

As we announced in February, we’ve initiated a restructuring plan and among other things we'll, one, combine our CB and CRM groups into new CRV Group. Two, eliminate the international and Endosurgery Headquarters Organization.

Three, reorganize our clinical and R&D organizations and streamline our corporate staff functions and four, restructure international operations to reduce our administrative costs and invest in commercial expansion opportunities including significant investment in emerging markets. The execution of these restructuring initiatives over the next 21 months will result in a gross reduction of our operating expenses by an estimated $200 to $250 million.

We will reinvest the portion of these savings into customer facing and development related activities to help drive top line and future growth. We are on schedule with our planned restructuring at this point.

Let me now turn to guidance for the third quarter as well as revised guidance for the full year. From a US ICD share perspective, we expect the whole share in the second half of the year, exiting the year at approximately 25% share, a full 100 basis points higher than previous guidance.

Coupled with the impact in Q1 2010, we now estimate that the defib ship hold will have a negative impact of approximately $225 million for the full year, compared to our original estimate of $300 million, with $72 million in Q1 2010, $65 million in Q2 2010, $44 million in both Q3 2010 and $44 million in Q4 2010. This revised estimate represents the reduction in our US ICD Q4 2010 share at 300 basis points defib ship hold 100 basis points for disciplinary and (header) issues which combined reduced our share from 29% initially to 25%.

Turning to sales guidance for the third quarter of 2010, reported consolidated revenues are expected to be in the range of $1,850 million to $1,925 million which is down 9% to down 5% from the $2,025 million recorded in the third quarter 2009. If current foreign exchange rates hold constant through the third quarter, the head win from FX should be approximately $51 million or approximately 3% relative to Q3 ’09.

On a constant currency basis, Q3 consolidated sales should be in a range of down 6 to down 2. For DS we are targeting worldwide revenue to be in the range of $340 million to $365 million with the US revenue up $185 to $200 and our US revenue of $155 to $165.

For our defib business, we expect revenue of $385 to $410 worldwide with $265 to $285 in the US and $120 to $125 for US. For the third quarter, adjusted EPS excluding charges related to acquisitions, divestures, restructuring and amortization expense are expected to be in a range of $0.10 to $0.13 per share.

This includes an operational effective tax rate for the quarter on adjusted earnings of approximately 22% reflecting the delayed approval of the R&D tax growth. The company expects EPS on a GAAP basis in the third quarter of 2010 to be in a range of $0.01 to $0.05 per share.

Included in our GAAP EPS estimate is approximately $0.02 to $0.01 per share of restructuring related costs and $0.07 per share of amortization expense. Given the performance in Q2 2010, the company is revising estimates for the full year.

The company now estimates sales to be between $7.6 billion and $7.9 billion for the full year versus our previous guidance of $7.6 to $8 billion. If current foreign exchange rates are constant we expect FX to be minimum therefore our revised guidance both on reported and constant currency basis should be in the range of down 7% to down 4% for the full year.

To help you in adjusting your models for the full year, we now expect gross margins to be in the 67% to 68% range. As our gross margins improve in the second half due to a full period of defibrillator revenue.

We expect annual SG&A to be in the range of 32.5% to 33.5% of sales. R&D to be roughly 12.6% of sales, royalties of approximately 2.5% of sales and interest and other expense of approximately $400 million.

Adjusted EPS for the full year is now expected to be in the range of $0.54 to $0.62 per share versus our previous guidance of $0.50 to $0.60 per share. The company expects GAAP, EPS on a GAAP basis for the full year to be in the range of a loss of $0.91 to a loss of $0.81 per share.

Included in our GAAP EPS estimates for the year is a $1.20 per share loss related to the Q1 goodwill impairment charge, $0.03 per share related to Q1 intangible asset, a $0.14 per share gain related to the acquisition related credits, $0.10 to $0.08 per share of restructuring related cost and $0.26 per share of amortization expense. As discussed earlier, we now expect our adjusted operation tax rate for the full year 2010 to be approximately 19% excluding any of these recent tax items that may arise during the remainder of the year but including the R&D tax credit for the full year.

The RD tax credit has not yet been extended for 2010 but we are assuming that it will be approved in the fourth quarter of 2010 as it has in many previous years. The full year benefit of the R&D tax rate is 300 basis points on an annual effective rate.

As a result of this timing, we expect our operational effective tax rate for the third and fourth quarters will be approximately 22% and 12% respectively. That's it for guidance.

Now let me turn it over to Ray for an overview of the business in the quarter as well as his overall thoughts. Ray?

Thanks Jeff. Let me began with the more qualitative review on our businesses and then as usual I'll share brief thoughts on likes, dislikes and hot topics for the quarter overall.

In the first quarter we began the integration of our CRM businesses into our newly formed Cardiology Rhythm and Vascular Group. The CRV group is an example of Boston Scientific anticipating changes in the delivery of healthcare and leading the industry in responding to those changes.

CRV positions Boston Scientific as a company intensely focused on the care continuum for cardiovascular patients. We are continuing to make substantial investments in new technologies to build on our market leading positions across the cardiovascular service line.

We plan to introduce nearly 30 new CRV products alone in the US in the next 18 months. Looking at CRM, we estimate our worldwide ICD market share was down five percentage points compared to the second quarter of 2009, driven by the ship hold and products removal actions we initiated late in the first quarter.

In the US, we beat the top end of our guidance by $58 million due to our sales ramping back at a quicker pace than we anticipated, once we return to the market on April 15. As Jeff indicated, we have updated the estimated impact to the OUS defib business through the end of the year, now that we have been back on the market for more than three months.

While we make no promises to provide quarterly exit rate figures in the future, we estimate that our share exiting the second quarter was far closer to the 25% that we anticipated for the third quarter as opposed to the 23% we had originally predicted for the second quarter. We don’t expect our year-end market share to materially exceed our previous guidance but we could anticipate reaching those shares more quickly.

Obviously we do not have complete knowledge of comparative quarterly performances and therefore my comments should be taken inclusive of that disclaimer. Despite the ship hole and product removal, our technologies continue to prove their importance in the marketplace.

COGNIS and TELIGEN are still the smallest, thinnest, high energy device in the world and are being extremely well received. We remain committed to advancing our technologies and strengthening our CRM franchise.

In the US we launched the ACUITY Break-Away Lead Delivery System building on our already strong lead portfolio. In the first half of 2011, we plan to launch our next generation defibrillators creating greater choices for our customers including new features designed to improve functionality, diagnostic capability and ease-of-use.

We also plan to rollout our 4-SITE defib system in the US in the same timeframe. Additionally in 2011, we expect to launch our new wireless pacemaker platform built on the same platform as our existing high voltage devices in Europe and potentially in the US.

This new platform will be a first in a series of low-voltage launches over the next few years. Our international CRM performance was driven by continued robust growth in Japan following the launch of COGNIS, TELEGIN and Ultra late last year.

Our 4-SITE system has shown rapid adoption in Europe since its launch in the first quarter. We anticipate that our international defib performance will strengthen overtime.

Our worldwide EP business was flat, constant currency versus a year ago due principally to the product availability constraints with our Blazer Prime Catheter. Fortunately we currently have full availability.

Blazer Prime is the improved version of the market leading Blazer Ablation Catheter, and is designed to deliver enhanced performance, responsiveness and durability. We also received CE mark approval for Blazer Prime and have begun introducing the product to customers in Europe.

We began the launch of Blazer Dx-20 in Europe earlier this year and feedback from physicians has been very similar to the positive responses we have received from US doctors. The Blazer open irrigated ablation catheter should be ready for European launch later this year with US clinical trials beginning around the same time.

Turning now to Cardiovascular. Worldwide DS revenue of $389 million was at the top end of our guidance range and included $51 million of revenue from PROMUS Element, now available in 100 countries.

Share continues to move towards PROMUS Element outside the US. PROMUS Element will shift to self-manufactured margins in mid 2012 and improve our DS gross margin performance substantially.

Our worldwide DS market share at 38% help steady the last quarter and was down 4 points versus the second quarter of 2009. While our mix continued to shift from TAXUS to PROMUS on a year-to-year basis, that shift has slowed since the first quarter.

The DS market was flat due to increase in both penetration rates and PCIs offset by weak ASPs compared to a year ago. In the US revenue of $209 million was at the top end of our guidance range with share at 46% and mix having stabilized in the last two quarters as we continue to focus on our two drug DDS offering.

We continue to expect to launch TAXUS Element in the US in the middle of 2011 and PROMUS Element in the middle of 2012. We received CE mark for TAXUS element in May, which include a specific indication for the treatment of diabetic patients.

This marks the first geography where we offer both TAXUS and PROMUS on the element platform with its innovative stent design and proprietary platinum chromium alloy. While we are early in the rollout of TAXUS Element, we believe it will be well received due to the performance advantages of the element platform along with improving performance of Paclitaxel, particularly as an advance treatment option for diabetic patients.

We continue to be the European DS market share leader at 32% including a preliminary 16% share for PROMUS Element despite a lack of current access to a along list of public tenders that we'll annualize in due course. In Japan the PROMUS and Xience launch rollout is now complete and the DS market in terms of share shift has stabilized for the time being.

Our 38% share was down 15 points from the second quarter of 2009 and down five points from the last quarter. While we lost market share through April and May, it now appears to have bottomed out.

During the launch rollout, we saw a deep discounting by two of our competitors which we chose not to participate in. Since April, market prices have stabilized with minimal erosion in June.

We are focused on pursuing the Japanese market place and we will not be distracted short term. We continue to believe the reset trial sponsored by Abbott comparing Xience to Cypher is inflating Abbott’s share.

This trial limits our ability to sell PROMUS to these trial centers until late July or early August which is when we expect that enrollment will be completed. We estimate that the reset centers represent 22% of the entire Japanese market.

It’s possible that Abbott will attempt to initiate a new trial and we expect it to document equally unnecessary science. We have consistently chosen not to do marketing studies that revalidate known performance versus first generation products.

Most important to know and to give you a better prospective, in the non-reset trial accounts where both PROMUS and Xience and other competitors are available, we currently have a 50% market share. We intend to focus our two-drug platform with expectations to gain share in the back half of the year.

We continue to expect to launch TAXUS Element in Japan in late 2011 to early 2012 and PROMUS element in the middle of 2012. At the Paris PCR meeting in May, the SPIRIT V registry results were presented and they demonstrated positive long-term safety data supporting the PROMUS and Xience stent family, now out to six years.

These data give us increasing confidence in PROMUS element which uses the same drug in polymer technology with the improvements of the Element platform. The unique stent architecture and proprietary platinum chromium alloy combined to offer reduced recoil, greater radio strength, increased flexibility and improved radiopacity helping to create consistent and predictable lesion vision coverage and drug distribution while improving deliverability.

The primary endpoint of the Perseus was recently published in the JACC confirming the safety and efficacy of the TAXUS Element stent and importantly demonstrating effective transfer of Paclitaxel and the SIBS polymer to the new platform alloy or enhanced benefits in the Q10 handling. Also in May we announced the initiation of Platinum Plus clinical trial designed to compare the performance of PROMUS Element to Xience Prime in an unrestrictive all comers patient population.

The results which were expected to presented in 2010 will demonstrate how two distinct stent platforms with the same Everolimus drug performed in comparison to one another. In support of the TAXUS and PROMUS element launches in India in the latter part of 2010 or early 2011, we agreed to fund an important investigator initiative study comparing the safety and efficacy of TAXUS Element versus Xience Prime in patients with diabetes led by primary investigator, Dr.

[Upendra Kaul] of New Delhi. Diabetes is a global healthcare challenge and we look to the study to confirm the unique role of the TAXUS stent in diabetic coronary disease.

In addition we will undertake through an investigator sponsored research protocol and all comers registry to assess the outcome of patients with complex coronary disease in India, treat it with a PROMUS Element stent. The study will be led by Dr.

Chennai (inaudible) of Chennai. These are two examples of our deliberate strategy to increase investment in strategically and scientifically relevant investigator sponsored research in the CRV space.

In the near future, we expect to began patient enrolment in the evolved clinical trial designed to asses the safety and performance of our synergy coronary stent. The Synergy stent represents our fourth generation drug-eluding stent technology and features of a viral absorbable polymer and Everolimus drug formulation to create a thin uniform coating on the abluminal or outer surface of a platinum, chromium, alloy stent.

The synergy stent is intended to provide the same degree of restenosis reduction as the conventional drug-eluding stent while offering faster and more complete vessel healing and with the aim of reduced length of time on dual antiplatelet therapy, which under most current regimens actually cost more than the stent. We are uniquely able to offer customers a choice between the two best DES stents that are on the market today.

This is a point of differentiation between us and our competition and it represents one of the key reasons we continue to be the worldwide DES leader. Turning to our other CV product lines, our worldwide non-stent IC Core business was down 7% in constant currency from the second quarter of 2009.

This decline is attributed mostly to PTCA balloon price erosion. However, we maintained our US and worldwide PTCA balloon leadership positions with 56% and 39% shares respectively.

We began the European rollout of Apex platinum during the second quarter and physicians have been happy with the improved visibility of the product. We launched the NC Quantum Apex post dilitation balloon catheter during June in the US and a limited market evaluation in Europe and CE-marked countries.

Early results have exceeded expectations. We believe our new balloon product should result in year-end balloon market share gains in the mid-single digits.

In addition, we’ve began a phased US, European and other CE-marked countries launch of our Kinetix Guidewire and plan to expand the full product availability by the next quarter. Kinetix represents an exciting wave of new products in the space and most notably for us, a first time highly-competitive entry into the nearly $100 million workhourse wire market.

We continue to expect market share gains in low double digits by the end of 2010. In our worldwide peripheral interventions business we experienced a 4% constant currency revenue decline compared to the second quarter of 2009.

On the year-to-date basis, our worldwide PI business declined by 1% with our international business growing 2% and our US business declining 5% year-to-date, the US declines attributed to procedural downturn and increased competition. Taking as discontinued products and current unanticipated backorders are worldwide year-to-date PI business is flat year-over-year with international growth of 3% and a US decline of 3%.

We continue to build on strong global positions with successful launches of our new technologies worldwide. We launched our epic vascular stent internationally and we continue to see expansion in new accounts and overall share growth.

In the corroded stent space, the adapt corroded stent system launched in selective international markets, clearly gained incremental share in our targeted accounts. We also began a limited launch in Japan for our Carotid Wallstent system.

Both the adapt launch and the Japan Carotid Wallstent launch should bolster our worldwide leadership position in the carotid stent market. The stent launches have helped to produce 3% international stent growth year-over-year and helped to stabilize our stent franchise.

Additionally, we fully launched the express LD iliac stent system in the US during the quarter. We have gained incremental share with this approval and solidified our number one position in balloon-expandable stents.

We launched the Sterling SL Balloon in both the US and European markets during the second quarter, filling a gap in our PTA portfolio in the long balloon segment. We are early in the overall rollout of Sterling SL, but we've clearly penetrated the target accounts and taken share.

We also launched the Cyro long balloons to select accounts in the US during June. In the interventional oncology product segment we launched our Renegade Hi-Flo kits in June.

This brings together the Renegade Hi-Flo and the Fathom guide wire in a single sterile package. We continue to be very excited about our number one worldwide market position in peripheral intervention space.

We believe our growth projections for this business are solid as demonstrated by the multiple product launches in the quarter. However, we do continue to monitor the procedural trends and ASP trends within the US and European markets.

Given the global nature of this market, we believe the continued international momentum can offset some of the US softness seen here today. Our cardiovascular business continues to be well positioned and we absolutely believe our overall cath lab leadership will be strong for years to come.

In highly competitive environment, our neurovascular business reported softer results this quarter and declined 6% in constant currency compared to the second quarter of last year while maintaining its global leadership in every franchise. During the quarter, we launched our Neuroform ez adjunctive stent in both Europe and the US and have received positive feedback from physicians.

At the (inaudible) meeting in Istanbul more than 100 physicians had the opportunity to practice Neuroform ez on our flow model. Neuroform ez offers an improved delivery system for the market leading Neuroform stent.

It is designed to provide open catheter delivery technique which aids in the placement of stents in tortuous neurovascular anatomy. Our neurovascular business is the only company that provides stent delivery technology via over the wire and open catheter systems as well as regulatory recognition for the stent transfer technique.

We are looking forward to expanding our Neuroform ez offering to other regions over the coming months. Our guide ware business experienced softer results this quarter and was up only 3% compared to last year.

This was largely a result of the backorder situation experienced at the end of the quarter with our market leading Syncro 2 wire. As production ramps up, we expect to be at the backorder by the end of the third quarter.

Our catheter business, excluding Flow directed and guide catheters grew 4%, driven by strong sales of our Excel-10 microcatheter and Renegade Hi-Flo catheter. In is in conjunction with the Neuroform ez stent delivery system.

Our ICAD or intracranial atherosclerotic disease business posted another quarter of strong results with the 17% growth, overall driven by strong sales in the US, Brazil, Korea and China. The NIH sponsored wing span stent and gateway balloon system Sampras trial is ahead of schedule and continues to aggressively enroll patients with more than 40% of patients enrolled within the first 18 months.

Our adjunctive stemming business declined 2% this quarter compared to last year but maintained its leadership position. The launch of our Neuroform ez stent with its improved delivery system will reinforce our number one position in Hemorrhagic adjunctive stenting.

Under significant pressure from multiple competitive coil and stent launches our detachable coil business was down 13% compared to the second quarter of last year. However, we continue to maintain the coil market share leadership with 20 plus or more market share points than our nearest competitor.

We are looking forward to launching our new Phoenix Coil in the back half of the year. Our Endoscopy business continued its strong performance recording another solid quarter, posting 8% worldwide growth with 6% growth in the US and 10% growth internationally.

The Endo business saw a strong growth in its metal stent franchise recording an impressive 10% increase worldwide. This performance was led by our biliary and esophageal stent product lines due to continued market conversion to the WallFlex product offering.

Worldwide growth of 9% was also recorded in our biliary device franchise due to the continue adoption of the Spyglass platform. The homeostasis franchise experienced significant growth at 18% on the strength of the resolution clip technology.

In the third quarter, the Endoscopy business plans commercialized a number of new products targeting the biliary interventional market. Urology and Women’s Health continues to deliver solid results growing at 4% on a constant currency basis with 9% growth in our Women’s Health business.

Our Women’s Health business continues to benefit from 2009 new product launches in our pelvic floor franchise as well as a strong double digit growth in our gynecology franchise. Our Urology business maintained its leadership position, grew 2% on a constant currency basis, despite declines in our Prolieve and Biopsy businesses.

Total divisional growth excluding these two franchises was 8%. During the quarter, we launched two new laser fibers used in the treatment of kidney stone disease.

In the second half of 2010, we are preparing for the US launch of our recently approved next generation Genesys HTA System for the treatment of abnormal uterine bleeding. We believe that the significantly enhanced user interface and the ease of use of the Genesys System will enable the business to grow its share of the $400 million worldwide AUB market.

Our neuromodulation business was disappointing and essentially flat over year. Procedure volumes continue to run softer than expected, a trend that we believe reflects some ongoing loss of benefits and lack of available co-pay funds through increased unemployment in a soft economy with respect to elective procedures.

We have noted with interest some of the ongoing weakness in the elective procedure potion of the US Spine business, and feel that there maybe some parallels here. Despite this temporary weakness in spinal cord stimulation markets, we believe the US market will return to double-digit growth in the second half of the year.

We firmly believe our differentiated technology and the new product launches will continue to place us in a favorable position. In fact we were pleased to launch our new lead splitters at the 12th annual meeting of the American Society of Interventional Pain Physicians just a few weeks ago.

We’ve already seen an increase in multi-lead placement cases. These new splitters are for a broad range of lead configurations and are designed to provide physicians with more treatment options for their chronic pain patients.

These splitters in conjunction with our wide 1x8 leads, expected to launch in the third quarter will help make our portfolio of percutaneous lead options more extensive than any other company. We look forward to these new products helping us grow our market share through the second half of 2010.

I’ll finish some overall perspective on the quarter, what we liked, what we didn’t like and a hot topic. I’ll start with what we liked.

Number one, we liked the recovery we made during the quarter from the CRM ship hold and product removal. We finished the quarter ahead of what we expected to be in terms of our ICD and CRTD sales.

We are encouraged by these results and we believe we may potentially exit the year with slightly better market share than was our view coming into the second quarter. I want to recognize our CRM sales team again for the role they played in this recovery as well as the entire commercial team.

This was a case of excellent execution and everyone involved deserves a great deal of credit. Also I want to recognize the physician community which has kept an open ear and an open mind throughout this process.

We did a lot of meetings and calls, literally hundreds, and virtually everyone listened. They also responded often very candidly and forthrightly, and we appreciate those responses.

At the end of the day, they said they liked our products and many of them have returned to those products. Not all of them have returned, but we will continue to work to bring people back into the fold.

Secondly, we liked the solid expense control we demonstrated during the quarter. We showed good discipline around expense management, our restructuring program continues to drive our expenses down to fund areas of future growth.

We will continue to invest in our growth opportunities, and we expect our operating expenses to reflect that in the second half of the year. We hope to invest between $20 million and $40 million or $0.01 to $0.02 of EPS related to India and China, and sales feet on the street alone during the second half of 2010.

Thirdly, we like the approval and launch of TAXUS Element in EMEA. TAXUS Element was on the market for only a few weeks at the end of the quarter, but we liked what we saw.

We also liked the indication for the treatment of diabetic patients. Since approximately 1/3 of all patients with coronary artery disease in Europe, also have diabetes.

We are off to a good start with TAXUS Element in EMEA, which compliments the ongoing strong performance of PROMUS Element. As you know PROMUS Elements launched in EMEA in the fourth quarter of last year and has posted strong numbers since then, including during the second quarter.

Both Element platforms are performing well in EMEA, and we believe this bodes well for their future performance in the US and Japan. Fourthly, we like that we maintained our worldwide drug-eluting stent leadership which included another strong quarter in the US.

We also liked that we launched the NC Quantum Apex Balloon Catheter and the Kinetix Guidewire. And that the initial indications are that these products are selling well and have the potential to increase our share of the balloon catheter and Guidewire markets.

Overall we continue to offer innovation, performance and leadership throughout the cath lab. Let me switch now to what we didn’t like.

Number one, we continue to be concerned about pricing erosion, especially in CRM and DES. That concern was compounded this quarter by a weakening euro, which shred our revenues.

We now start to see additional pricing pressures in the rest of our interventional cardiology business, and to a greater degree in Southern Europe. We will use the power of our newly formed CRV group, cross care and the patient care continuum to leverage our strength in the cath lab.

Number two, we weren’t happy with our overall sales performance, while we are encouraged by our CRM recovery and continued solid performances in Endoscopy, Urology and Women's Health businesses. We continued to underperform relative to our expectations for our other businesses.

While some of this underperformance is related to factors beyond our control, we must do a better job of executing relative to our sales plans. Thirdly, we didn’t like our TAXUS share loss in Europe and Japan.

The share loss in Europe was offset by the strong showing of PROMUS Element, but there was no offsetting effect in Japan since PROMUS Element is not on the market there. We can argue that there are some unique circumstances in Japan to which we refused to respond in time.

However the shares are the shares. On a hot topic; I'll close on a hot topic of our often debated financial stability.

We cannot underestimate the importance of refinancing of the remaining 2011 debt maturities and the extension of our revolving credit facility by the middle of 2010 as plan. The continued strong commitment of lenders to our new $3 billion credit facility was extraordinary.

As a result, we have minimum debt obligations for the next three years. In addition the new credit facility provides us with ample safety margins under our bank covenant as well as a prepayable debt to help achieve our target capital structure goals over the next two to three years.

Overall, this refinancing adds to our financial strength and flexibility and that enhances our capacity to fund selected acquisitions and other technology investments. In order to truly turnaround this business, we need not only the prerequisite executable strategic plan but the financial stability and strength to do so.

Today our ratios and details reflect substantial progress. For instance, our 2.6 times debt-to-EBITDA coverage far exceeds our covenant maximum limit of 3.85 times.

Our 5.7 times EBITDA to interest expense coverage is nearly double the covenant minimum of 3 times. Our liquidity reflects an increase in our access-to-capital to more than $2.3 billion now.

Our debt maturities through the end of 2012 are $1.15 billion, representing less than one year of free cash flow. And lastly we have more than $1 billion of cash in the bank as I speak.

While we understand that doing things right every time does not necessary earn a short term marks, we intend to sort of rebuild the BSC's power in an orderly and planful way. With that, I’ll turn it back to Larry who will moderate Q&A.

Thanks, Ray. In a minute, I would like to open it up to questions.

In an effort to enable us to deal with many questions as possible in the time remaining, I would request that you limit yourself to one question and a related follow up. Again, I remind you that Ray will be joined during the Q&A session by Sam and several other business presidents as well as Dr.

Dawkin and Dr. Stein.

Tanya, please go ahead.

First Ray, I just wanted to ask on the ICD side and then I have got a gross margin question. So first on ICD, there is one thing if you could just talk in a little bit more detail about some of the dynamics in the quarter.

For example, was there any pent-up replacement demand, its worth calling out? I was wondering if you could kind of clarify your comments on pricing in CRM.

Did ICD pricing deteriorate than the level you were seeing previously and just any other comments like that on ICDs?

Couple of things we are analyzing, one of the things we have taken the approach of kind of staying with that 25% year-end exit is there is some stock build and there were some physicians that were dedicated sufficiently to our products that our patients had long enough batteries and they were comfortable with patient safety. They literally did delay the surgery.

So we have tried to analyze that in detail and account for that. It was not a huge factor to be honest with you, so I don’t to overly sway your thinking but it was enough of a factor to have us suggest that lets just stay with the 25% year-end exit at this point in time till we learn more.

On CRM pricing, no, we haven’t seen, I think as I recall some of our competitors, maybe a few analysts seem to indicate that we reduce price to reenter the market and gain share. I think my comments from the last time we did this were that we would not do that.

We did not and we have not seen deterioration in CRM pricing as it relates to Boston Scientific.

Let me just add Bob that from the work that we've been able to kind a tease apart on the quarter in terms of why we over exceeded expectations, a vast majority had to do with the fact that we covered in two weeks. First is the six weeks.

That’s over 80% or 90% of kind of the over performance.

And in terms of quantifying that replacement, demand and other factors is $20 million or $30 million a good number to use or do you now want to give that detail yet?

That’s high, because a lot of factors in there, that are not negative on an ongoing basis. So I don’t know that we'll necessarily publicly quantify them.

I would suggest that you not think of them as substantial factors and at least until we update you on the third quarter, stick with the idea that we're going exit 25% but we're going to get there quicker.

Thank you for that. And then on gross margins, Ray, first of all, is there a time that you have in mind for an Analyst Day to kind of provide some longer term thoughts on Boston scientific?

And then specifically on gross margins, you said I think 67.5% excluding the recall expenses. You know as we think about the timeframe going forward, before you have PROMUS Element on the US market do you think you can see any substantial improvement to that 67.5% kind of level?

Let me comment on the analyst day and then I will start off and Jeff can jump in. Yes we are planning in the fall.

I don’t know that Larry has nailed the date down. I don’t think we have, the reason we shifted it is because the ship hold obviously slowed everything down for us.

We just completed some really great work on a strategic plan. I am really pleased, in fact we actually finished a good chunk of that yesterday, strangely enough.

And we have a Board meeting come up next week which we will be sharing that with them. So we wanted to do two things, Bob, one is get a really exciting and communicable strategic plan before running out and talking to analysts.

I know it’s been a long time for BSC. Secondly, we want to obviously communicate that to the Board and get their backing.

Thirdly we wanted to communicate it to our employees before we talk to the public. And we have major all employee meeting setup, I think some 6000 people in Minneapolis/St.

Paul on August 19. And then go public after that, so that’s kind of the order of events.

In terms of margins, I think the mix of new products going forward, let me start with the concern. I will let Jeff jump in.

There is lots of positive contributing factors, restructuring and plant network organization, so on and so on that we’ve covered with you. The one qualifying factor, we are keeping a careful eye on this price.

And that’s the one that we are not excessively concerned, but it is eroding somewhat and that’s kind of a counter factor.

So if you look at our guidance for the year, revised guidance for the year. Bob, it’s higher, the margin is higher than it was previously.

And that reflects the fact that the impact of the stock ship significantly reduces in Q3 and Q4 as we’re obviously on the market for 100% of the time. So obviously that helps the margin, the other dynamic that we benefit, as we kind of circle through the back half of the year is our comparisons in the fourth quarter from a mix perspective are much easier in US, given the impacts of the compared study to the DS mix in the US.

The two more significant direct benefits that are tangible relative to gross margins are the plant network optimization, where we are very far long. We have a second of two low cost manufacturing facilities in Costa Rica that are operational and taking in product quickly.

We have talked about end of 2012, that’s worth roughly a $100 million of gross margin benefit and more than a 100 basis points of benefit and that facility will not be full. So there’s an opportunity to add to that facility.

So, that’s another component and then obviously the PROMUS Element, the DS mix, so we are continuing to enjoy a nice mix shift in Europe and that product is ahead of plan. We are very bullish on that platform both for Europe and for Japan and for the US.

So that is going to be a significant benefit for us in 2012.

Let me start with the non-DES, non-CRM businesses. The question here is you continue to struggle in these other areas which could be critical areas for the company.

I think you said it was down 1% or 2% constant currency for the quarter. You talked about a lot of products, but in your guidance for the second half of the year can you give me a sense of the trajectory at which you're expecting the non-DES and non-CRM businesses to grow or to accelerate?

Yes, I’ll give you the frontend and Jeff can jump in the back Mike. It is a new product story combined with a release of backorder story offset by pricing pressure primarily on balloons and competitive products.

So the net effect of that we still think is positive growth in the second half, but we have been struggling and we’ve been struggling for a quite a while because some of those launches have been delayed and of course you didn’t anticipate the back orders. So I think to the extent, the good offsets the bad that we get the growth there, but we are keeping an eye on both price and some level of procedural softness although international offsets the US situation.

Let me kind of step through a few business. Ray spent quite a bit of time outlining kind of a number of new products that we’ve introduced within the peripheral intervention space.

That business has been kind of flat to down low single digits, kind of in the last year through the first two quarters of this year. So we expect based on those products which have been introduced and are in the market right now to generate some growth.

We think that that market is growing at least in the mid single digit. So some debate as to whether it’s a little higher or little lower depending on kind of some of the pricing dynamics, particularly in the US.

But we think that we can get kind of into that range in the back half of the year. Electrophysiology is the market that’s growing in the upper single digits/lower double digits depending on how much you put into that in terms of the different techniques.

As Ray had mentioned we are back in the market with one of our products, one of the Blazer products. We’ve got a number of new products in that space that we expect are going to generate some growth.\ And then you’ve got neuromodulation, that grew 10% in the first quarter and had been growing 15% pretty consistently.

And this is kind of bit of an unusual quarter. Although we did have an unusual quarter in the first quarter of 2009, where we had very low growth which we similarly expected that was due to kind of timing and co-pays and reimbursements.

And later on in 2009 it resumed its double digit growth. So we expect that that’s going to come back to upper single digit/lower double digit growth.

So those three business along we’ve got the products, we've got the sales forces and we think we can execute along the back half of the year. So we will just have to see how it plays out as we get through the third and fourth quarter.

Yeah I think too Mike, and I going to go a little beyond the other non-core and PI and what not but I think that is one of the problems with the company struggling through some turnaround times and then the ship hold and other things over the last couple or three years and not having analyst meetings because I noted that one of our good competitors got a lot of newspaper coverage announcing 60 new products. In fact if you look through our news products now that we are going to be releasing over the next 12 to 18 months, there’s 30 alone in CRV and probably at least six, we haven’t had them all up.

When you look at all the other categories so I think part of the problem is we have not been in the spot where we can communicate as effectively that the pipeline is stronger perhaps than people think.

And just a couple of follow-ups here, first question is do you think the public speculation about the potential sale of either of the neurovascular, neuromodulation business has impacted those businesses this quarter, I know you are not confirming or commenting on whether or not those are processes (inaudible), but do you think they impacted those businesses in the quarter. And then having accomplished what you did during the end of the quarter on the debt side, do you think you are in a position that will start considering M&A more actively?

Well, obviously we don't make any comments on the businesses, but even if they were and other ones were analysis of the two businesses, you happen to mention don't show any indications of any subjects around that being a problem. It was marketplace procedures, softness co-pays and of course we are way late with the Phoenix coil and that's killing us as good competitors come out with competitive coil products.

I don't, to me it's a product marketing procedure set of issues and has nothing to do with M&A. On the second one, I guess I will (find) it and if Jeff wants to add again or others.

Yes, the answer is yes. I think you will see as we deliver on that annual meeting, I mean everybody in the world can do the math on this company, as two-thirds of your business is going at 1% or 2% or 3%.

How much do you have to grow the rest or what your portfolio has to look like in order to be a 5% or 6% company and double digit bottom line, so everybody can do the math and therefore we have be in the growth M&A business and we have to find ways of growing are existing portfolio and shifting it around. We are moving literally over a few years hundreds of millions of dollars of traditional R&D into dozen or so growth initiative platforms.

If we don't do that and we can't grow the top line and convince people there's sustainability, we don't get to have a higher stock price and a multiple expansion. I hate to say this one-on-one to you because I know you know other.

It is as simple as that. We just need to be able to communicate it as we get out on the Analyst Day and employee meetings.

I wouldn't 100% agree with that. The only slight caveat I would put on it would be the structure of the refinancing package that we put in place was designed to put pre-payable debt in place.

So we could prepay it down fairly quickly. I think we've said publicly that our desired debt to EBITDA range is somewhere between one and half to two times and as we said we're kind of in the high [twos] and that's because we want to make sure we have financial flexibilities in organization.

We still have litigation and some tax risk that we need to cover. So at least in the short to medium term until we get through those, we want to have a reasonable leverage available.

So increased capacity, the $1 billion in the balance sheet and the free cash flow while help us both kind of delever the company’s position more firmly going forward and also free up funds to grow the top line.

Maybe if you could come back to your price concerns and maybe expanding your comments a little bit, you are seeing a little bit in southern Europe, where do you think the greatest risks are, is it on the price side or what about when you think about Europe, especially as you look at the 2011, what about utilization pressures and maybe talk a little about, as you see it coming how you get ahead of these maybe negative, increasingly negative curves?

Yeah I think, Rick, although there is some utilization pressures that's spread across the countries and there is some consolidation of buying practices and regions transparencies, some of the things we are seeing in the US that the TPOs are get bigger in places like Germany. So there's a lot of that kind of activity but we are used to most of that and probably more of it now frankly but we are used to dealing with encountering most of that activity, but what we are not used to seeing is, and I am still referring primarily to Spain and Italy.

I said southern Europe just to keep it general in the commentary but really I would say Greece is the other one. But we all know what's going on there but Spain and Italy were accustomed to those being pretty price attractive markets.

Spain more so than Italy and I think we are starting to see the pressure in those two countries and I would revert that as a bigger watch out for well, not just for us but for anybody with medical devices, then I would sort of utilization other factors that are going on.

And we should assume that the new products you launch, are you anticipating that will help you offset some of this pressure?

Yes, I think to the extent that you can market those benefits, I think what we probably have to do too is have fuller bags and more feet on the street over there, and that’s part of those investments I talked about in the second half. We are not going to make this all up with new products in Europe.

Our coverage in Europe is substandard compared to our competitors in terms of real feet on the street, and the hospital, institutional and physician coverage, and there is a bunch of reasons for that historically. We are going to reinvest very clearly on feet on the street in Europe, including Spain and Italy.

And that I think will help us a lot more than anything else we are doing.

A quick follow-up if I could maybe for Jeff. I just want to make sure I understand, Jeff, the narrowed range at the upper end, why the $8 billion to $7.9 billion if currency is minimal?

Maybe I just missed that in the commentary. Thanks.

Yes, currency is all but more than minimal, so the currency is about $100 million.

And so that’s the sole factor?

Yes, exactly.

Good morning. Ray, given some of the near term kind of strategic priorities behind the company with debt refinancing as well as getting your arms around the ship hold, there's a lot of talk about priorities.

I wonder if you could just sort of force rank or give us sort of more granular view of the strategic priorities we should be thinking for the business here over the next six to 12 months now that some of the near term priorities are somewhat more well in hand?

Yes, I think we mentioned some of that David. New products obviously are crucial to us.

The bringing together of the value proposition and executional strategy around CRV and completing integration is huge for us. The emerging markets program that we are putting together is huge, completion of restructuring and reinvesting those dollars for the most part back into feet on the street emerging markets.

The execution of our growth initiatives, we have 12 target areas we are going after, that include a combination of outside M&A work and inside internal R&D shifting. There’s a pretty long list, Jeff can also add to that.

The only other one that I would add is, as we look at our global footprint and our cost structure, we are not a low-cost organization. So, as we think about increasing our commercial footprint in China and India, we currently have a handful of direct employees in India, which is rather unusual for a company of our size.

So I personally think that there is a lot of opportunity from a distribution perspective to as we grow our emerging markets to grow our employee base disproportionately larger in those areas and actually get some productivity and cost arbitrage benefit that’s coming up. So I think that’s another opportunity from a productivity perspective as the organizations, never really looked at.

They were actually pretty deep into, and that’s above and beyond the restructuring benefits that we’ve talked about.

Great, that's very helpful. Maybe just two more quick ones.

I guess, first Ray, you've talked the last couple calls about sort of the medical device delivery model, talking about a combination of the cardiovascular footprint. I wonder if you've seen changes amongst other medical device manufactures as fast followers as you begin to execute that plan.

Are you talking outside of our product mix and segments?

Or even inside your product mix but I just wondered given, you've been talking but there should begin to execute that distribution model, whether you've seen other medical device peers beginning to emulate that model?

I think copy is the slightest form of flattery so it didn’t take long for other friends in Minnesota to make a CRV group, so I was pretty excited about that. It validates our decisions, so that’s a good one.

I think we are starting to see companies work together that fill each others gaps in terms of a hospital calling basis, so I think you are starting to see versions of using this term in a proper way, bundling between non-competing but people whose product gaps and lines fill each other. We are starting to see some of that, more people working together.

I haven’t paid as much attention in recent times to outside sort of the world that Boston Scientific serves. So I am probably not as good at answering that, but we are certainly seeing it within our own competitors for sure.

Just one last quick one and I'll jump back in queue. Jeff, this is the second time, or the first time Ray has mentioned specifically the impact that mid 2012 PROMUS Element manufacturing could have in the business, did you think about your GMs right now and sort of the 66 level, what impact do you think that change alone could have on the business?

We’ve talked historically that that’s worth probably $200 million come 2012 and almost all of that’s through the gross margin. So just take that over the base of revenue, you get a pretty good idea.

Couple of hundred basis points atleast.

Hi this is actually Narendra for Larry, can you here me?

Yes, you're going to have to speak up a little bit, we can hardly hear you.

My question was about the OUS ICD guidance, the $120 million to $125 million. If I am doing the math right it implies a year-over-year decline in the mid single digits, any commentary on what’s driving that would be great.

I don’t think so. Are you looking third quarter guidance, is that what you're talking about?

Yes.

Yeah, I haven’t got it. Just as looking at, after you have compared the prior but I don’t think there is any specific guidance.

Is you question what's creating that number?

Yeah you it seems to be down sequentially, is that a combination of price, procedure volumes?

Sequential decline in US for a start of seasonality, so what you want to look at I think to help yourself out, is take currency out of it all together and look at the relative sales last year and in prior years between second and third quarter and compare this with that. I don’t have it right in front of me but I would suggest that looking at it, a chunk of it is currency neutral.

If you made a currency neutral, is going to be seasonality, obviously, particularly in Europe.

Thank you, that’s helpful. And one quick follow up on the (inaudible) CRV FDA approval, any thoughts on when that might come through?

Its literally any time now. It would have been nice frankly to have that conveniently before this phone call so we put it in the script but that has not happened but it's literally anytime now.

So coming back to your question relative to the guidance, I think the range is more kind of mid single digit growth from a guidance perspective.

Thank you. I have two questions.

The first has to do with, you talked about increasing pricing pressure in regions like Spain and Italy, what percentage of your revenue are those two regions?

Sorry Joanne, like to help you with that one but we don’t breakout individual countries and we ought to do it all the time.

Less than 5%, less than 3%?

Nice try.

All right, can't blame me. In the area of in the Target Therapeutics business, two of your competitors are working on ischemic stroke applications, is that an area that you’ve looked at?

Yeah it is Joanne. When we sorted through the new growth initiatives we originally start out and then end up with about 15 areas and we're kind of we did it down.

That target area was amongst the original group, whether it will survive the final growth initiatives in a priority order that we can get to the next couple of years. I can’t answer right now but yes it was in the initial screen and we got it down to above 15 growth initiatives.

Is there a section that you're particularly excited about more in one area or another? Is there a product line I mean outside of the CRM and DES?

Yes, I mean, sure. Couple of things I have talked about before.

I mean would have sounded like the rest of the world obviously structured hard as their instinct. But if I went beyond that, I would be looking to three areas I’ve mentioned many, many times; hypertension, pulmonary and endo-based solutions for asthma, diabetes and obesity we’ve mentioned and then a bunch of areas within women’s health that I don’t want to get too specific on because it will give too much information.

But those four areas, we’re spending an extraordinary amount of time on and we think are huge for the company in the future.

Before we go on to the next question just want to clarify that OUS defib question so that the caller had kind asked the question, if looking at our guidance for instance, that guidance is on an FX basis as Ray mentioned. So if you adjust for the FX, its quite a different story and the business would be growing as I mentioned kind of mid single digit to upper single digit, which is consistent with what I did in the second quarter, just to be clear.

Hi, good morning and thanks for taking the question. On the CRM side, how disruptive do you think your ship hold was on the US end market dynamics?

Should we think of the impact that just maybe a short-term shift in market share or do you think you had a meaningful negative impact on procedures?

I don’t think it had negative impact on procedures because the physicians will only make decisions relative to patient safety. So, our competitors will jump in with our help or our request, the physician's request.

I don’t think it had any effect in procedures. There was not a lot of clamor that I heard about patient service saying if this entire product line regardless of who the supplier is.

We did hear some of that in the past. But I think it was very clear that this was a paper work problem on our part.

It was nobody else’s fault, it was no other manufacturers fault and it was not a safety problem with the product. So, we haven’t seen anything.

And we have done some market research and reputation research and various things to assess our current status. We haven’t seen anything like that too.

So when its all sent down here, do you think US markets going to be growing with low single digits on a dollar basis here this quarter or any thoughts on that front?

I don’t know what the other guys look like. In my brain right now it's nearly 2% but the problems without seeing the other folks I just don’t have a feel.

You've got Medtronic with the unusual weak thing between their off quarters, so it's hard for me to call it. My guess it's in the zero to 2% and I'd probably settle on one, feeling probably to see everybody else’s numbers at this point.

On the pricing question, in Spain and Italy, I'm assuming some of the austerity measures are having an impact on pricing, but are you seeing any impact on procedure rates in those countries? And more importantly are you seeing any inklings of pricing pressure in other markets including Germany, France and UK?

No, I didn’t say anything on procedures. I don’t think procedures is the issue and it rarely is in many of the business we are in because you need it to live obviously.

I haven’t seen anything unusual in the other marketplaces. Germany is a tough pricing market, but I don’t think there’s anything going on that’s extraordinary versus prior time.

I think if something we are sensitive and I don’t know to what extent you followed pharma activities in Spain and the resulting over-the-counter medical device changes as opposed to institutional medical device sales. We were able to get away from substantial cuts relative to the government, but the pressure is still on those countries because of their economic situation that they are in.

It’s not Greece, but I mean Spain and Portugal, and I shouldn’t quote Portugal. It’s really Iberia I am talking about, but they are struggling economically but in terms of absolute procedures I would say no.

Just kind of going back to the M&A commentary, coupled with some of the areas of interest you had mentioned, just wondering and going back looking at the market and how it's evolved here of late, how much value do you still see here in a very well diversified model? Clearly, you listed off a laundry list of interesting areas, but I'm just curious how active do you think you'll be in disposing some businesses and does it make sense to be a player in all these from a bundling perspective or just really be concentrated in just a couple of key categories longer down the road.

I think that’s for the most parts. So subject to Jeff’s qualifying comments on ensuring we properly de-leverage the business as well.

We are down to about a dozen growth initiatives, we have just done a tremendous amount of work here on understanding how to get there. Do I think we will go bigger, be a big player in all 12, the answer is no.

I think we will probably double down our bets in two or three or four and really try and grow them and I don’t know perfectly at this stage which three or four will be, I know which ones I would like it to be for the most part, but you can’t tell because you don’t have absolute control of that external environment. I don’t think we are non-diversified right now.

The economy is pretty well diversified because there is a lot of sub-categories in cardiovascular. Our problem is that two-thirds of the business is not growing, anything more than very low-single digits, so our ability to go into these areas is under the theory that we are trying to move the needle for the whole company and get back to where we can be a substantial player on the top line with the sustainable growth.

So I mean that’s the whole ball game here in terms of what we are trying to accomplish, but we are not going to play in a dozen of them. If that’s question, there is no way we could and be a winner in them.

We haven’t got enough funds to invest those kind of dollars.

So it sounds like then you'd be more willing to do larger transactions to have a greater foothold and presence in these select key markets that you define versus trying to do tuck-ins, a little bit here, a little bit there?

Yes, I don’t like responding yes to people who use larger transactions because that gets translated post call into big problems and it suddenly becomes dilutive in all that conversation. What I would prefer to say is that we have said we could do one to 300 and do some of those even prior to the refinancing, we are certainly capable of doing a number of those and doing somewhat larger ones, but I don’t want to get into commentary that leads people to believe dilutive transformation because that’s just nothing, but trouble I think it’s translated that one.

And then just a quick product question. Any new update, I know you mentioned a new ICD platform early next year.

I think that was a little bit delayed. I had thought that that was coming more towards the end of this year and any update on MRI safe devices?

Yes, we have an MRIC safe program that will be a behind at least one of our primary competitors if not two. I’m not sure on the timing question.

I’d have to check previous scripts, I thought we had said early next year, but if we said late, I don’t recall that being in any scripts. Maybe we did say once or twice, so if it is moved, it is moved a few months.

I think what we will do is talk with people when we do the Analyst Day and employee meetings about what the features and benefits and what those products would look like rather than try and cover it here in a 30 second answer.

This is actually Mike Duncan for Bruce. Could you talk about some of the impediments to regaining more US ICD share in the back half of the year?

Or, asked a different way, are there any segments of customers that are particularly weary of switching back to Boston Scientific completely?

Yes, it’s a good question. We segment our customers in many different categories, but in the ship hold, we did some segmenting, that’s somewhat more unusual, not just start to look at how people are feeling about this new segment and according to view towards us if you will or guide it in prior times.

So there aren't any customers who don't like our products but there's a small percentage of customers that are weary of the sort of repetitive recall problems, in this case its paperwork but it’s a history of five or six years. So you do have some of those and the weariness would cause you to at least lose them temporarily.

The other issue is you have some sales force disruption caused either by some of the disciplinary actions or disciplinary plus the ship hold where they don't want to stay, we don’t want them to stay. They are not comfortable, for whatever reason you want to clump with and of course in relatively stickier businesses you lose some sales that way.

I don’t know the people that have really become completely weary will ever get that business back its hard to tell. I think our mind and our heads are kind of built around the idea that we are going to rebuild our base from 25% as a new base with new products and new technologies and the CRV horsepower and cardiovascular service line and move on from there.

There is a part of that I don't think you probably do get back.

And then do you expect the new ICD products in the US to eventually drive your market share back to ‘09 levels?

I wouldn’t want to give you a long term guidance through a strap point and I think we will try and cover that with you at the Analyst meeting because if I do that I end up giving you a long term five year market share guidance and I don't really want to do that at this point.

I think let Jeff comment, to the part of it is a question that was asked earlier that we are not completely, I think Mike Weinstein asked about it, how much is bulk, how much is delay and how do we want, do we have enough data to really completely understand that at this point and we don't completely, although we are doing a pretty slow analysis and I think we just want to be careful not to get ahead of ourselves and then realize that some of that was stock filling and delayed procedures. Again, we don't think it's a huge issue.

In fact, I'm pretty sure its not, but we are just not convinced at this point we have complete data on it.

Yeah, the other thing that I would highlight was the point that Ray made that we stepped back and looked at a number of areas including emerging markets in China and India and quite frankly all regions of the world. We have such a strong pipeline of products coming out that we feel that we can put investments in the back half of this year (inaudible) on the street and other types of investments to drive revenue growth, we want to do that.

So that incrementally added another $20 to $40 million of SG&A that wasn't previously contemplated when we gave the guidance back in the first quarter. So you have to factor that in.

That would cost a couple of pennies. Derrick Sung - Sanford Bernstein Okay, thanks that’s helpful.

My next question is on the transition of PROMUS to PROMUS Element in Europe. So it looks like you still are selling and implanting PROMUS in Europe.

How much supply do you have left there and when do you expect that supply to fully run out because that's not being replenished correct, since the supply agreement ran out last year. So when will we expect all the PROMUS gone and supply halved or switched from either TAXUS, TAXUS Element or PROMUS Element?

Derrick, I will answer that one as soon as I am sure all the folks from Abbot, Medtronic and J&J have hung the phone up. When I hear all of the clicks, I'll answer that one for you, okay?

Derrick Sung - Sanford Bernstein All right. Is it fair to say that the transition then is sort of moving along to your expectations?

Yes, The transition is going really well. In fact some of the data testing over there by people doing research, one of the missing is the fact that there is a huge number of tenders and I had this briefly in my script but if I didn't pop out of it.

There is a huge number of tenders and opportunities that have not annualized debts and therefore in the midst of those tenders under most of those countries rules you would not be able to supply from this element because it disallows from a legal point of view. So the opportunity for us to first of all, we are doing very well with it, its $51 million overall, obviously in the US but the opportunity to substantially grow that from the settlement business is large because we are only servicing a part of the market.

Derrick Sung - Sanford Bernstein Are you surprised at all that you are seeing more of a conversion from TAXUS to PROMUS Element rather than PROMUS to PROMUS Element or is that not surprising to you?

I think the share position on TAXUS a little lower than we thought it would be and some of that of course is the ramblings of the studies and what not have been done on the effects of the various meetings but we are a little lower in Europe and in Japan on TAXUS then we would have expected to be. Conversely in the case of Europe, obviously we don't have to the Element in Japan.

We are doing better I think just correctly said we are ahead of our own plans substantially on Element. So there's kind of, there's a tradeoff there but yeah the answer would be yes to your question.

The other thing that I would just add on your PROMUS Element question, obviously we had a very strong first half of the year in terms of market acceptance of PROMUS Element, the expectation in terms of transition from PROMUS to PROMUS Element really accelerates the back half of the year to the point that by year end in Europe that our share is almost fully converted to PROMUS Element. So supply issues are not going to be a problem, they will not apparently materially impacts us at all.

The other dynamic is we anticipated that we would have had TAXUS Element at the beginning of this year. That really would have helped us with the TAXUS transition.

Now that we have it and it’s in the market almost a month now, our expectation is that it really does a very good job of abating some of the market share erosion, and give people a good opportunity to kind of take their business on to kind of the leading edge stent platform, the Element platform Derrick Sung - Sanford Bernstein Okay and if I could just have one last quick one on Neuromodulation? So just quickly on Neuromodulation Mike, how was the trialing looking, are you seeing that as a leading indicator that maybe the market is going to pick up next quarter, and when is that next generation IPG going to be coming out?

Yeah, Derrick the trials for the last couple of months had been soft, and we are starting to see the upward trend towards the back half of the year. The timing between when somebody does a trial and when they get their permanent seems to be have been stretched a bit compared to what we are normally used to seeing in this business.

And a lot of that has to do with the fact they’ve got to come out of pocket with their co-pay. So, we are seeing a little bit of a delay.

The trials are still fairly strong for the year and heading in the right direction for us. What was the second part of your question?

The nextgen IPG?

Yeah so, we are not ready to comment on that. We obviously have been working on a product for a while, and the progress and the mile stones are being hit on a timely basis.

But we are not ready to talk about when we will be releasing that yet.

I was wondering Ray if you could spend a couple minutes on the peripheral business. Obviously that business was growing pretty well last year and seems to have slowed down this year.

Maybe walk us through what the dynamics are there, whether that's market or market share, and then what's the timing of a potential turnaround.

Yeah, I think there's two or three things there. One, is competitive new products, two is the delay of some of our new products although we just put a bunch of them out, and I tried to listen in the script.

Thirdly, there is definitely more balloon pricing pressures, and fourthly, as a US comment only, there’s procedural softness, at least at this point of time offset by a little more strength in international. So that's kind of the scenario we are living with.

As we look to the second half, and we look at the new product releases, the entries we have, how they compete in those marketplaces and the relief of the backorders hopefully that are plaguing within the first half on a comparative basis. I think it leads us to believe that we can get to market kinds of growth or a little better.

And I think we are using sort of mid-single digit kind of numbers as market growth, does that help?

Yes. And then maybe just more broadly, as you look at new product launches across your portfolio, is there something that's changed about the way those products are accepted, the timing of penetration of new products?

I think you have been giving a statistic before about the number of new products, the percent of revenue that came from products that were introduced in the past 24 months. As you look across some of your competitors we are seeing slower uptake of new products.

Is there something that's changing in the buying patterns of your customers that we should be aware of?

No, I don’t think so; I don’t think its customers. We are starting to run some pretty high numbers and pretty attractive numbers relative to percent of new products for sales, for virtually any major med device.

So, if you think of anything over a third of your business, in our case we are running at about 44%. So the strength of the pipeline and the dollar values to total in prior 24 months and so on is high.

I think if we run any risk, and it’s not Boston Scientific, its industry, is obviously the messages we're getting in general from the FDA, reevaluation of 5K, 10K and so on around reform, I think could cause us all some substantial delays in new products reaching patients. But our performance as of right now, no I am happy with that aspect.

We just got to make sure our sales execution matches up with that.

Okay, and then lastly, you alluded to this a couple times on the call about the long term growth rate or opportunities for revenue growth given where you think the markets you compete in, that two-thirds of sales are growing. As you maybe overtime provide more details on R&D allocations, should we expect to see R&D get allocated to more of the growth businesses where you have an opportunity or absolute R&D dollars come down with more of that investment allocated to external investment?

No, it's absolutely former. We intend to be around the billion dollar mark rough numbers, out of that just got to take your clinicals and quality and other related spendings and as you get to a net R&D number, we expect to shift from right now and I have been public about this number so I'll share it again with you.

We look at our growth initiatives that we have planned right now and we look at the corresponding spending we have today against those initiatives. It’s about 6% of spend.

Any major medical device company that’s going to spend internally on growth initiatives needs to be 25% to a third of their spending on an annual basis, so you can easily run the map. If it’s 6% today, let’s say we are spending $50 million, we got to be at $250 million, $300 million a year in order to support those programs and shift it to that.

In fact we are doing that as we speak and we have done it in this strap plan we just finished.

Okay, and maybe just one quick maintenance question for Jeff. The tax ratio that you are on the 19% number, is that a good number to use on a go-forward basis?

No, I would say, that’s why we kind of keep going back and forward between kind of the operational rate versus kind of the adjusted rate, so a better number is probably more like 20%, 21% going forward, kind of post this year.

Tanya, we've got time if there is just a couple of more questions. We've got time for just a couple more.

Hi, this is Matt for Adam, thanks for taking the question. A quick one on TAXUS Element and neurovascular, did you give a TAXUS Element revenue number in the quarter?

No, too early.

Okay. And then on neurovascular, are you still expecting approval of the coil in the second half?

Late in the second half, near the end of the year is our current best thought on that is just correct.

Okay. And then a quick on stents, you were dinged a little bit by the trialing of Abbott products in Japan.

How quickly do you expect that to ramp back up and where do you think share might shake out there?

Yes, we were dinged a little bit. If 22% of the entire Japanese market is now locked up in these Abbott trials, so I don’t know what dinged little bit means to you but that’s dinged a lot to me.

We don’t know what they are going to do? If they restart another one of these adventure trials, we are going to be on for another six months of locking up 20% of the marketplace, so it’s hard for us to tell at this point.

What we do know is what I mentioned in the script and I think it’s the most, and we don’t control what they do and we're not going to play in that [world]. But what is important is of the open marketplace that’s available to us where you can buy PROMUS, Xience or anybody else's stent that’s approved there.

We are gaining 50% market share in those accounts. That’s what excites me.

The market study stuff, I can’t do anything about it.

Thank you. Hi, guys.

Ray, I was wondering if you could talk to the state of the CRM sales force. You alluded to it earlier and you went to the ship hold and the disciplinary actions.

Do you see the sales forces as stable now?

I think it’s too early to be stabilized. I think we'll probably go through a little more turmoil I would guess.

I hope that’s not true but I would think we will because the combination of the two and for these people, they’ve been through this three, four times. I think it’s pretty tough.

So I would like to see it stabilize through the end of the year but I don’t know that it can completely stabilized at this point. To the extent, we do have that issue.

We got to get out their with our strategic plan story, get it public, do the analyst day and obviously attract or be more easily able to attract some great folks back into the replace those roles, I think that’s probably where we are at.

One follow-up on ICD. In terms of market growth how much do you guys peg right now initial implants are contributing in the US versus replacements?

And any concern that your replacements could see a slowdown as you get to the five-year anniversary of the Guidant recalls?

Yes, I don’t have the current percentages in front of me to answer the first part of your question. We can dig that out for you and try and have a look at that after the fact.

The only concern we would have is we have ran the graphs numbers on the period of time, when we went through some of the recalls when it was Guidant and so on. And obviously we do get hurt by some of that through the t replacement period.

However we have calculated that into our planning and we have offset that by what we feel is going to be the beginnings of the take up as made it, as we get the indication of course on dollar sale and basis and margin, talking about $6,000 or $7,000 uplifts in price versus some decline in replacements due to those prior year periods. So the net effect, Steve for us is not on doing negative.

I think people just focus on that replacement, old Guidant story, do the math and say gee, these guys at Boston will be down on replacements, I think they forget to add in that second part to the gain, at 7000 a piece at, these margins that more than mixed up for replacement losses.

Tanya, with that we are going to conclude the call and I would like to thank everybody who joined us today and for your continued interest in Boston Scientific. Prior to you disconnecting, Tanya will give you all the pertinent details relative to the replay of this call.

Thank you.