Contact lens maker and retailer square off

Deseret News (Salt Lake City), Sep 16, 2006 by Matthew Perrone Associated Press

WASHINGTON -- A contact-lens manufacturer and an online retailer squared off Friday while testifying at a House hearing over arrangements that limit the outlets available for some contact lenses.

Lawmakers in the Energy and Commerce subcommittee urged them to resolve their differences rather than request a legislative fix.

Jonathan Coon, CEO of Draper-based 1-800 CONTACTS Inc., argued against agreements between contact-lens makers and eye-care providers that require consumers to purchase their lenses from a doctor or at select retailers.

Coon said such distribution arrangements limit competition and force consumers to return to the same prescriber for future lens purchases. Lenses sold by eye care providers typically are pricier than those bought online.

Gregory Fryling, COO of CooperVision, disagreed. His company, a subsidiary of Cooper Cos., has refused to make its popular Proclear lens available to companies like 1-800 Contacts, arguing that working with such distributors could damage the "reputation and image" of its products.

Eye doctors have joined in criticizing online distributors, arguing that they indirectly encourage patients to skip follow-up.

CooperVision is a key player in the limited distribution lens market. Unlike bigger rivals like Johnson & Johnson and Bausch & Lomb Inc., Cooper does not advertise directly to consumers and has focused on cultivating the loyalty of ophthalmologists and optometrists.

Three years ago, Congress passed a law requiring eye doctors to give patients a copy of their prescription so that they can shop around for the best price. But that doesn't help if the lenses are only available through doctors' offices and select retailers, according to online distributors.

After hearing from both sides, Rep. Clifford Stearns, R-Fla., said unintended consequences of a new law could create more problems than it would solve.

However, with state and federal regulators coming down on opposite sides of the argument, the possibility of additional regulation remains. A 2005 study by the Federal Trade Commission concluded that limited distribution agreements do not restrict consumers' access to contact lenses. But 39 state attorneys general recently drafted a letter to members of Congress, encouraging legislation to ban such agreements.