Higher Prices for Contact Lenses?
Sept. 15, 2006 — A dispute between contact lens manufacturers, sellers, and eye care professionals could soon have 38 million consumers paying more for their lenses.
The fight involves little-publicized distribution agreements that restrict sales of certain lens brands to doctor or optometrist offices.
The limited distribution agreements come in several forms, but essentially allow eye care professionals to prescribe lenses only such professionals sell. That can force a patient to pay inflated prices for lenses they can’t buy anywhere else.
A 2003 law and a court settlement forced major lens manufacturers to sell their lenses to the mass market, opening up huge sales to stores like Wal-Mart and Costco, as well as to online and telephone retailers.
But terms of that settlement expire Nov. 1, potentially clearing the way for more manufacturers to limit sales to doctors’ offices.
That could allow more doctors to prescribe more lenses only they can sell. Lens retailers call that anti-competitive.
But doctors say selling lenses through retailers allows patients to bypass regular checkups — and for retailers to make a sale without even verifying the patient’s prescription.
Manufacturers say the vast majority of their lenses are now sold on the mass market.
It remains unclear if major manufacturers will increase the use of restrictive sales agreements after Nov. 1.
Jonathan C. Coon, CEO of 1-800 Contacts, Inc., says allowing optometrists and other eye care professionals exclusive rights to sell the lenses they prescribe is an inherent conflict of interest and goes against the intent of the 2003 law.
That law required doctors to hand out paper prescriptions, presumably so patients could shop around for the best price.
“The purpose of the law is to allow patients to choose; the purpose of the [limited distribution] practice is to deny them that choice,” Coon told a House Energy and Commerce subcommittee on Capitol Hill Friday.
Manufacturers have promoted the practice to doctors as a way to increase physician revenue and to ensure that patients come back when they need a new supply of lenses.
Meg Graham, spokeswoman for Bausch & Lomb, Inc., would not divulge the percentage of that company’s contact sales through “doctor-only” agreements, calling the information proprietary.
“At this point, we would expect to continue our current practices,” she says of the company’s future plans regarding doctor-only sales.
Johnson & Johnson Vision Care Inc., the nation’s largest contact lens maker, said through a spokesman, “The company prefers not to make any comment” concerning sales.
Lens manufacturer CIBA Vision said in a statement that its lenses are “available through alternative channels of distribution, including from eye care professionals and on-line retailers.” The company did not indicate whether it plans to alter sales strategies.
Doctors say they do not abuse the agreements.
Direct-to-consumer retailers make it easy for patients to avoid regular checkups, warns Oliver D. Schein, MD, professor of ophthalmology at Johns Hopkins University. Such checkups allow doctors to re-examine the patient for any vision changes or development of eye diseases, and gives doctors the chance to counsel patients on safe lens handling and hygiene.
“Because patients can get replacements so easily from online providers, they often neglect follow-up examination,” Schein says. “The potential for serious, sight-threatening ocular eye injury … is significant and real.”
Doctors also complain it’s too easy for online and phone retailers to sell lenses without verifying valid prescriptions.
The law requires sellers to verify prescriptions with the doctor’s office. But if no verification comes within eight hours, the sale can go ahead.
The Federal Trade Commission this summer fined Walsh Optical, Inc. $40,000 for selling lenses from three of its web sites without first verifying prescriptions.
New Laws on Sales?
A handful of lawmakers have proposed legislation requiring retailers to get a positive verification before making a sale.
On the other side, there are also proposals that would limit the scope of doctor-only agreements in an effort to spur more price competition.
Rep. Charles A. Gonzalez, D-Texas, urged retailers, doctors, and manufacturers to find a way to “get along” without getting Congress involved in making new laws.
“If you ask Congress to fix the problem you’re going to be surprised,” he told them. “Your fate and your destiny will really be in other people’s hands, and you don’t want that.”