The Future of Contact Lenses in America...

[Pete Hanlin]

In one of the Optom publications, I noticed that 1-800-CONTACTS has purchased a contact manufacturing facility. I also noticed a quote in another article of the same publication by a 1800 exec who said something to the effect that they were working on the "public's behalf" to end the monopoly "some practitioners" have on the contact lens supply chain via privately labelled brands...

Now this is just a wild musing, but here is where I think the entire market will go someday...

Outlets like 1800 will purchase facilities that enable them to produce various kinds of soft-lens products. Once they have access to various materials, they will start a legal battle to create an atmosphere where the material and basic design of a lens are the only things specifiable by Rx. In other words, Patient Smith will go to his/her doctor and receive a prescription for a polyfilcon-A (or whatever) contact lens with an 8.6mm radius and a 14.0mm diameter. The Rx can be filled with any lens meeting the material and basic design characteristics.

The legal argument would be that the individual designs companies like J&J and Ciba use are pretty much meaningless when it comes to the safety of the lens. Therefore, the 1800 manufactured lens would be, in effect, a generic substitute (and we've all seen how lawmakers and the public love generics).

What do you think? One way or another, the soft lens industry can only continue down its already familiar path... The only money left in the game is in the professional fees, but with the glut of ODs and MDs out there (and the ease with which soft lenses can be "fitted"), its a competative market with no real profits.

[NC-OD]

Pete,

I think you have hit the nail exactly, dead-center, on the head. The heyday of big (or even small) profit in soft contact lenses has long past. I am almost at a point of stopping fitting soft lenses due to zero profit (when you take into consideration of staff time and inconvience) and almost zero patient compliance. The mail order companies will succeed at making contacts and selling them very affordably. I absolutely have no problem with the though. More power to them, I say. In my case, I will profit greatly from the increase in red eye visits, which is much more cost efficient for me.

Really, I find contact lens fitting to be basically a waste of my time financially. I do it as a service to the patient who wants them. So contact lenses are now a non-issue and unfortunately, eyeglasses will not be far behind. This is a very good reason for OD's migrating into treating eye diseases. The money there is much easier to come by (in my opinion). As you can tell, I just don't have a good outlook for the continued profit of eyecare materials. There are too many good companies trying to get a piece of the pie......and they will.

[chip anderson]

The business has so deteriorated I no longer even enjoy it. I used to get all my jollies fitting people that everyone else said could not be done. Even this isn't fun anymore, too many people can't understand why a quality professional job isn't the same price as the $ 49.95 stuff and available instantly.

Chip

[Jo]

I was thinking the same thing this morning. I was checking through every suppliers price list trying to find a wholesale cost on Freshlook Colorblends that would enable me to match a mail order retailer's consumer price of $19.95; I couldn't find a single price below $24.00 anywhere. I matched the price on the Freshloooks and sold them at a loss because this was just one of three purchases the patient placed through us.

The time involved with going through all of those distributors wasn't worth it. If this is the the direction disposables are heading in, I wish the Doctor would start to get away from them. Again, it isn't even just the profit issue it is a time management issue.

[Jo]

OPTICAL DISPENSING NEWS

Number 101
September 18, 2002

http://www.opticaldispensing.com

Published By James E. Sheedy, OD, PhD, and Ethis Communications, Inc.
Jennifer LiMarzi, Managing Editor

CIBA FILES LAWSUIT AGAINST TWO GEORGIA COMPANIES

CIBA Vision Corporation has filed a federal lawsuit against two Georgia companies, C & C Trading Company, Inc. and MAS Wholesale & Retail, for the widespread illegal distribution and sale of contact lenses. The lawsuit claims that C & C Trading is illegally selling CIBA contact lenses to consumers from at least three locations in Georgia, while MAS Wholesale & Retail has sold lenses at beauty products trade shows in addition to other locations throughout the country. In its lawsuit CIBA Vision is seeking a permanent injunction, damages, and attorney fees.

This was one of a couple of stories concerning contact lens deregulation in the Optical Dispensing News I received today. At least Ciba is acting to put a stop to things on the vendor end.

[Pete Hanlin]

At least Ciba is acting to put a stop to things on the vendor end.
Well, Johnson & Johnson has spent tons of money in the effort to keep the soft contact lens supply under control, to no avail.

Wasn't it the FDA (or was it the FTC?) who actually requested that the states back off from laws regulating the distribution of contact lenses? As has been discussed before, there simply aren't enough "dead bodies" (or even that many corneal ulcers, apparently) to interest lawmakers. The legal eagles have decided that soft contact lenses widely available as cheaply as possible is the best thing for the public.

As NC-OD mentions, there isn't any profit left on the material side of soft contact lenses (actually, there hasn't been for a while now, but Optometry is only now beginning to get a focus on the picture). Once they've all tried the private labelling garbage (and the subsequent irate calls from their patients who try to order the lenses through a direct supply company), they'll move on to find new and greener pastures.

I suppose I'm glad I don't work for the CL division of Ciba or J&J. Although they probably do just fine selling contacts to the 1-800s of the world (you don't have to take a bunch of OD office staff out to lunch to push your latest lens when you sell it en masse to WalMart or 1-800), they'll need fewer and fewer reps and less personnel in general as the business of supplying CLs gets more and more "streamlined."

So, I suppose the message is- get out there and sell Panamics and Comforts (or the PAL of your choice).
;)

[LENNY]

I heard they also having problems getting and selling J&J products .
They are even looking to pay more than wholesale to get the product they need!

[Pete Hanlin]

I heard they also having problems getting and selling J&J products . They are even looking to pay more than wholesale to get the product they need!
Actually, 1-800's difficulty in procuring Vistakon products was at the heart of the article I was reading. Apparently, 1-800 did something with their advertising that posed a negative stance on J&J products. J&J successfully sued, but the decision had been overturned on appeal.

I think the distribution networks have the legal system's ear on this one and the manufacturers are left in the lurch (of course, I've always held that Ciba, J&J, et.al. are just crying crocodile tears over all this "direct marketing" of their lenses...). Its all just a show, cause sales are sales- after all!

[Cindy Hamlin]

Pete Hanlin said:
In one of the Optom publications, I noticed that 1-800-CONTACTS has purchased a contact manufacturing facility. I also noticed a quote in another article of the same publication by a 1800 exec who said something to the effect that they were working on the "public's behalf" to end the monopoly "some practitioners" have on the contact lens supply chain via privately labelled brands...

Pete,
According to the article they are working with "partner ODs" in order to get them to fit their private label brand when they develop it. I guess, no release of RX-off to the "partner OD" for a refit.

I wonder how many "partner ODs" they have. Maybe NCOD or Johns may have that number from some of the reading they do.

[NC-OD]

Sorry I don't have much info on the "partner OD" deal. I can tell you that I have never been contacted. I would go on the record to say that it is 100% unethical, in my opinion, for any eye doctor to fit "private label" contact lenses just to keep a "sale".

I wouldn't put up with a mechanic selling me a muffler kit whereby I HAD to purchase a muffler from him for life and couldn't get a comparable (just as good) muffler elsewhere. OD's (and OMD's) are wrong, wrong, wrong on this one.

And I agree with Pete again. I don't think the contact lens companies are realistically trying to stop illegal sales. The will stand to profit greatly from deregulation.

[Cindy Hamlin]

We are all well aware of their tactics. Maybe the "partner ODs" are another tactic to cloak themselves in legality.

[Pete Hanlin]

Maybe the "partner ODs" are another tactic to cloak themselves in legality.
Perhaps the "partner ODs" can link up with the NAOO... :D

I would go on the record to say that it is 100% unethical, in my opinion, for any eye doctor to fit "private label" contact lenses just to keep a "sale".
I wouldn't put up with a mechanic selling me a muffler kit whereby I HAD to purchase a muffler from him for life and couldn't get a comparable (just as good) muffler elsewhere. OD's (and OMD's) are wrong, wrong, wrong on this one.

Wow! That's putting it about as plainly (and as eloquently) as I've seen it put! I agree 105%! As a matter of fact, I think it is precisely this kind of activity (and the hassle patients have to go through when they want their cl Rx for legitimate purposes) that has invited the kind of judicial rulings that seem to favor the "alternative distribution" networks.

[Dannyboy]

I believe that 1-800 contacts maybe more and more active in the political arena trying to influnce of legislator at the federal level rather than the state level. It is easier to crop at the federal than to so many at the state level.

The proximity of a national prescription release rule is in the horizon in which ODs and OMDS will be forced to release the Rx without having the patient ask for it.

If you analyze how optometry gained all their legislative winnings was partially due to contact lenses. Ophthalmologist were so busy doing their stuff that they did not bother with contact lenses 25 years ago. The public was willing to pay then a hefty fee in order to wear them giving financial freedom to a relatively low paid profession then. Money that they invested wisely in schools and legislation.

Contact lenses are still alive and doing well in many practices. True that disposables are no way to gain a BMW but if you position your practice correctly it can give a nice boost.

As in glasses, there is niche...

Optometrists that say that its better to turn into the health aspect of eyecare because $$$ is better must be careful. As legislative it came to them, but legistalive it can be taken away too.... even in court. Lets not forget the the plugs issue in NY or the Florida attempts to discourage comanagement.

Lets not take our eyes away from what this 1 800 has planned. I suggest you aggresively fight them all the way.

An interesting point on the prescription release rule is what a prescription is. In the bill by Stark, it was defined at the end as " A prescription with an "OK" for contact lenses and any information that is required to obtain lenses. I can only bet that 1 800 has seen the opportunity in such language. Nothing is said about the specs....

Optometrists, ophthalmologists and opticians who derive their income or even part of their income should be concerned. The company that they purchased has the capacity and technology to compete with any manufacturer and if they are allowed to switch brands.......what is next? The more income they have the more power they will have. Their interest is in only the $$$. Ours is the benefit of the patient as well. They ultimately have nothing to loose as they stall everything but is pretty darn hard to stall a licensing board trying to yank your license.

Dannyboy

Crazy but sometimes makes sense

I




:hammer: :hammer: :hammer: