New tactics by the contact-lens makers might soon leave consumers seeing red. Major manufacturers have recently begun shifting to a new pricing policy that requires retailers and eye doctors to sell lenses at or above a manufacturer-dictated price. The effect? No more discounts for consumers. The only winners with this pricing strategy are manufacturers, high-priced retailers, and doctors, who would no longer have to compete with discounters.
What’s more, it’s unclear whether each manufacturer is acting independently in moving toward this type of rigid pricing. We’ve noticed that three of the top four companies—Alcon (aka CIBA), Bausch & Lomb, and Jonson & Johnson—have already adopted resale-price maintenance policies for some of their products. And the fourth, CooperVision, might not be far behind. The four account for 97 percent of all contact lenses sold in the United States.
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Consumers Union, the policy and advocacy arm of Consumer Reports, has long worked to ensure that consumers have access to safe and affordable contact lenses. We've been strong proponents of consumer choice for contact wearers and helped pass the Fairness to Contact Lens Consumers Act of 2003.
One of the key consumer benefits of that law is that it requires eye doctors to give the patient a copy of the contact-lens prescription—without charge, and without the patient having to ask—enabling the patient to shop around for the best price and service.
But the new pricing restrictions could undercut that ability, since all retailers, including eye doctors, would be required to sell contact lenses at the price set by the manufacturer. This can take a major toll on consumer pocketbooks. Nearly 40 million contact-lens wearers across the country spend more $4 billion each year on lenses and billions more on related products and services.
We’re not the only ones concerned. A bipartisan effort in the Senate is also examining the issue. Consumers Union recently testified at Senate Judiciary Subcommittee hearing looking at competition in the contact-lens industry and the impact that these types of pricing policies can have on consumers.
We believe that consumers should have options when it comes to buying contacts and retailers should have the freedom to discount their products. We urge lawmakers and antitrust enforcers to take a close look at competition in the contact-lens industry and further investigate these anticonsumer pricing practices.
This feature is part of a regular series by Consumers Union, the policy and advocacy arm of Consumer Reports. The nonprofit organization advocates for product safety, financial reform, safer food, health reform, and other consumer issues in Washington, D.C., the states, and in the marketplace.