The Backlash Against Eye Doctor Only Contacts

By Rhonda L. Rundle, The Wall Street Journal

When Jane Holeywell tried to refill her 19-year-old son’s contact-lens prescription, she was mystified that she couldn’t find the lenses online or at Wal-Mart where she usually shops. She had purchased an initial three-month supply last year from the family eye doctor who wrote the prescription, but she didn’t want to pay his high prices when the time came to reorder.

“Imagine when I discovered I couldn’t buy them cheaper elsewhere,” says the retired veterinary receptionist in Houston. It turned out that the Biomedics brand her son needed was available only through an eye doctor. In the end, Ms. Holeywell took a chance and bought a different, cheaper brand that a Wal-Mart salesperson assured her was the same as her son’s Biomedics lenses.

Ms. Holeywell had stumbled upon a little-understood segment of the vision-care industry: so-called doctor-only, or limited-distribution lenses that are meant to be sold only through eye-care professionals. The manufacturers, including CooperVision, Hydrogel Vision and Sauflon Pharmaceuticals, sell these lenses only to eye doctors (or chains that employ optometrists, such as LensCrafters). Prices vary, but eye-care professionals typically charge more — often a lot more — than warehouse clubs like Costco, mass merchandisers like Wal-Mart and Web sites like 1-800 Contacts.

Eye doctors say the practice is a positive for patients and encourages them to return more frequently to the office for needed checkups. Patients, they say, benefit from buying lenses from someone who regularly examines their eyes and instructs them on proper hygiene and lens care. Some manufacturers say their doctor-only products have special features, such as higher water retention or greater comfort, says Dan Bell, president of the Contact Lens Manufacturers Association, a trade group that represents about 100 lens makers. “Those are marketing tools and the marketplace decides whether those are real benefits or not,” he says.

But the practice is sparking complaints from consumers and retailers, who say it’s an effort to circumvent a 2003 law meant to encourage competition and make it easier for consumers to shop for the best deal. Under the Fairness to Contact Lens Consumers Act, eye doctors are required to hand patients a copy of their contact-lens prescription after an exam, whether they ask for it or not. Increasingly, consumers are finding that it doesn’t matter that they can take their prescription with them, because they still can fill it only with their ophthalmologist, optometrist or optician.

Amid rising complaints, Congress is now considering whether to ban restrictive distribution of lenses. And 39 state attorneys general collectively sent a letter in June to Sens. Robert Bennett of Utah and Patrick Leahy of Vermont, co-sponsors of a bill that would effectively outlaw doctor-only lenses. The practice “threatens to thwart the purposes” of the contact-lens-consumers act and “puts the eye-care providers’ profit motive ahead of patient welfare,” the letter stated.

While no one tracks just how many of the available lenses are “limited-distribution lenses,” retailers and eye doctors generally agree that it’s a relatively small portion of the market. But their use is spreading as eye-care professionals seek strategies to hold on to lens sales and bring clients back for regular checkups. Eye doctors still sell two-thirds of all contact lenses, but their turf is under pressure from big-box retailers, optical chains and mail-order companies. It’s a significant financial threat to optometrists who earn far more from product sales than from professional services, industry studies show.

According to a Federal Trade Commission study, a six-month supply of contact lenses sold in bricks-and-mortar locations are on average $15 more expensive than those sold online. For instance, one optometrist in Birmingham, Ala., charges $49 for a six-pack box of CooperVision’s Proclear Compatible lenses, a popular doctor-only brand. A widely available similar lens, Focus Monthly from CIBA Vision, was on sale last week for $20.95 at VisionDirect.com. The new O2Optix lens from CIBA Vision, touted as having “five times more oxygen than the leading lens” is available from one California optometrist for $30 a box; it sold last week for $22.45 at 1-800 Contacts and $21.87 at Walmart.com.

Despite manufacturers’ policies, doctor-only lenses are sometimes available online because Web sites buy them on the “gray market” overseas or from sources that resell inventory in violation of their agreements with lens sellers. Also, some lens brands that are sold only through doctors are widely sold under different names to mass merchandisers. The lenses inside are identical; only the names on the box are different.

Unlike medical doctors who have no financial stake in the drug scrips they write, eye-care professionals have a conflict because they sell what they prescribe, says Joe Zeidner, general counsel of 1-800 Contacts Inc., the largest Internet vendor. The company is pushing hard for an amendment to the 2003 law that would force lens makers to sell their products through all distribution channels. Bills to that effect were introduced earlier this year in both houses of Congress.

Optometrists and ophthalmologists strongly oppose the measures. And doctors are demanding legal changes of their own to crack down on what they contend are vendor abuses, including sales of large orders that encourage people to go too long without getting their eyes checked. The Federal Trade Commission recently accused three Web sites, including www.lensworld.com, of filling prescriptions without verifying them first. The owner of the sites, Walsh Optical Inc. of New Jersey, paid a $40,000 penalty and signed a consent decree without admitting or denying wrongdoing.

Under the current “passive verification” rule, a retailer can fill an order eight business hours after contacting the prescriber, unless the prescriber objects. But eye doctors say they don’t have enough time to go through the many faxed requests for verification and lodge any objections in time. They maintain that prescriptions should be positively verified, rather than filled by default. “We view this as ultimately a patient-safety issue,” says Thomas Steinemann, a Cleveland ophthalmologist and associate professor at Case Western Reserve University.

CooperVision, which last year acquired Ocular Sciences, is one of the largest sellers of limited-distribution lenses. The Biomedics lens prescribed for Ms. Holeywell’s son is an Ocular Sciences brand, which has a doctors-only policy. CooperVision, a unit of Cooper Cos., also sells its popular Proclear Compatibles brand to vendors who perform on-site eye exams, including chains such as LensCrafters, but won’t sell to online sellers. Other brands sold exclusively through eye-care professionals include some from CIBA Vision, a unit of Novartis AG; Extreme H20, made by Hydrogel Vision; and lenses sold by Sauflon Pharmaceuticals, a British company.

“We think the free market is working very well and no one should tell us who we can and can’t sell to,” says Greg Fryling, CooperVision’s president and chief operating officer. “Most people know they are paying a higher price when they buy from their optometrist” and choose that option to assure they are receiving a quality product and service. Counterfeit products are a real problem, he stressed. The FTC “hasn’t found any abuse with our products,” he added, referring to the study the agency published last year that concluded that limited distribution doesn’t harm competition.

In its February 2005 study, the FTC issued an opinion that limited distribution doesn’t compromise competition, partly because the practice isn’t widespread. But that could change. To settle antitrust litigation that had led to the 2003 consumer law, the big contact-lens companies agreed to sell their wares to alternate suppliers, including mail-order houses. Certain aspects of the settlements are expiring soon, however, potentially opening the door to new sales strategies.

Some consumers who are restricted to buying from an eye doctor say they don’t like it. “My eye doctor that I’ve been going to for years recently prescribed Proclear,” says Elaine Candiff, a 51-year-old homemaker in Victorville, Calif. “They are giving me good results, but if I had known I could only buy them through an eye-care professional I would have said: Just write a prescription for Acuvue,” a common product of Johnson & Johnson’s Vistakon, she says.

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