Finances

Globalization of Eyecare: Good for Humanity, Bad for U.S. ECPs?

By Brian Chou, OD, FAAO,

Brian Chou, OD, FAAO

and Jerome Legerton, OD, MS, MBA, FAAO
June 24, 2015

Emerging technologies are coming to the rescue of the estimated 2.4 billion people worldwide who need–but don’t have–refractive correction. The question is how the availability of these technologies will impact the profit margins of independent optometric practices in the U.S.

Many of those in need are in Third World countries, where limited access to care, high cost, and restricted distribution, pose significant challenges.Here are some of the emerging technologies that may help them, and possibly hurtOD practices in the U.S.:

Adjustable-focus eyeglasses. Take, for example, glasses based on Alvarez plates in which two complex lens surfaces slide against one another to instantly create the desired lens power. Players in this space include Quexta, Inc., (San Diego, CA) and Eyejusters, Ltd. (United Kingdom). Patients self-adjust the Alvarez plates until vision is subjectively clear before locking the prescription into place.

In a similar fashion, there are deformable membrane-based eyeglass lenses in which the volume of sandwiched liquid is adjusted to achieve the desired refractive effect before the correction is set. Players in this space include Adspecs (Adlens, UK) and Adspecs (Centre for Vision in the Developing World, UK). Both the Alvarez- and deformable membrane-based lenses can be mass-produced for a low cost and easily distributed as eyeglasses. While the aesthetics may leave something to be desired, these glasses are functional and could, as Optometry Giving Sight says, “…make the difference between a life of poverty and a life of opportunity.”

Jerome Legerton, OD, MS, MBA, FAAO

Mobile technology. The second major category includes mobile technology using data-driven diagnosis and telemedicine. As described in an earlier blog, EyeNetra and SVOne are leading smartphone-based technologies for determining refractive error subjectively and objectively, respectively. The EyeNetra technology recently launched under the mobile service Blink in New York City. The resulting eyeglass prescription is filled however appropriate. In the Third World, prescription fulfillment could range from selecting the closest prescription from an inventory of donated glasses, to using portable lens-casting systems, or even the previously-described adjustable-focus glasses.

Offshore optical labs. Globalization of refractive care is also complemented by the growth of the offshore spectacle lab business in which digital surfacing is available with a low labor cost. A real-life situation that foreshadows the future is illustrated by the consumer behaviors of engineers and other professionals from India who are employed in the U.S. Even though they have relatively generous vision plans, they surprisingly forego using the plans for eyewear, and instead, fill their eyeglass prescription in India when visiting family over the holidays.

Why? In India, they may get eyewear at a lower total cost than their vision plan co-payments and material overages. Surprisingly, the quality of the offshore materials appear excellent including well-constructed frames and digitally-surfaced lenses with premium anti-reflective treatment. Offshore labs are growing due to the vision correction needs of the developing masses, including in China, Southeast Asia and India. Yet these same products can be imported into the U.S., potentially disrupting the economic ecosystem of the eyewear materials market, for the spectacle lab behemoths and everyone else in the ophthalmicsupply chain.

Generic contact lenses. A similar dynamic is brewing for contact lenses. Most conventional hydrogel contact lens polymers are already off-patent. The early generation silicone hydrogels will be going off-patent soon. This setsthe stage for low-cost, but high-volume, independent contact lens manufacturers in Asia to import their “generic” lenses into the U.S., although their core market is also in Asia where double-digit growth will likely continue for years to come.

The emergence of new technology for low-cost, mobile refractive eyecare, and accompanying vision correction for the offshore market, is contemporaneously setting the stage for drama here in the U.S. What promises to provide vision correction to the global masses with high efficiency and low cost may at the same time disrupt the traditional economic models here in the U.S., where consumers underpay for professional services, but overpay for ophthalmic materials. Even with regulatory protections in place, gray market loopholes and the prospect of inadequate regulatory enforcement will facilitate start-ups exploiting the competitive advantages of their new technology, while material profitability erodes from the traditional eyecare professionals’ brick-and-mortar practices.

The irony is that while many of us support the global fight against uncorrected refractive error, and pull for technology-based solutions, personal financial motivations may force many eyecare professionals to resist derivatives of these same technologies from gaining a foothold here in the U.S. Similarly, the large spectacle labs,contact lens manufacturers, frame manufacturers and vision plans will strategically protect their home turf.
While it may take some time for the dust to settle, we are optimistic that clinicians will adapt to these external dynamics and perpetuate their thriving and profitable practices by doing what’s best for patients–although their practices may look quite different from how they do today.
Some owners will take shelter by migrating into medical eyecare and specialty services like corneal refractive therapy, low vision, vision therapy and irregular cornea contact lens prescribing. It remains uncertain, however, if the organic demand for these services could sustain the growing number of practicing ODs. If not, an increasing number of practices will transform into high-volume, exam-only locations with a reduced physical footprint and overhead, where all prescriptions are filled outside.

Of course, these all are justfuture possibilities.In the meantime, most ODs will continue running their practices the same as before, but with an ear to the ground.

How do you think the globalization of eyecare will impact your practice? Do you have any ideas for remaining profitable in a global technology and services environment?

Brian Chou, OD, FAAO, is a partner with EyeLux Optometry in San Diego, Calif. To contact him: chou@refractivesource.com.

Jerome Legerton, OD, MS, MBA, FAAO, is an author, lecturer, inventor, consultant, strategic planner and futurist in the ophthalmic industry. To contact him: jlegerton@aol.com.

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