Price cuts may be in sight for laser eye corrections

2 laser makers drop prices as FDA OKs a third machine

February 25, 2000|By M. William Salganik | M. William Salganik,SUN STAFF

Approval for a new vision correction laser, announced yesterday, along with fee reductions by the two leading laser makers, may touch off a new round of price competition in the Baltimore laser eye market.

But some laser center operators in the Baltimore market -- which has experienced aggressive price competition since the fall -- said they have no plans to cut prices further. Others took a wait and see position.

Bausch & Lomb Inc. announced yesterday that it had received U.S. Food and Drug Administration approval for its laser, called Technolas 217, to be used to correct mild to moderate near-sightedness.

Earlier this week, in a move widely believed to be in anticipation of Bausch & Lomb's entry into the market, the two leading laser makers, Visx Inc. and Summit Technology Inc., cut their fees charged to surgeons from $250 per eye to $100.

"This will allow centers to further discount the global fee to the patient," said Michael Bjoro, senior administrator for the ophthalmology department at the University of Maryland School of Medicine. "This will allow another $150 of price flexibility."

His department provides the surgeons for University Laser Vision Center, which recently lowered its price from $5,200 to $4,200.

The Baltimore market has already seen strong price competition.

While laser centers typically had been charging about $5,000 to correct both eyes, one Baltimore operator began advertising a price of $2,995, and some others cut their prices in response.

But the deep discounters said yesterday that they have no plans for further price cuts, despite the reduction in laser fees.

"I don't see any change because we're already at the most aggressive price point in the market," said Bob Brodney, chief operating officer of See Clearly Vision Group, which operates Baltimore Laser Eye Center in Pikesville.

His center is charging $2,700 for both eyes, in what Brodney said was a special promotion lasting through March.

Thomas E. Wilson, president of Cincinnati-based LCA-Vision Inc., which pioneered the $2,995 price in the Baltimore market, said: "Adding up all the factors when we set the price, we anticipated a reduction" in the fee paid to the laser company.

However, Brodney said, some of the centers charging higher fees -- and promoting the experience of their surgeons or the excellence of their hospital affiliations -- might use the cut in laser fees as "an excuse to get a fresh message out there" by reducing price.

Bjoro said University Laser Vision wants "to re-evaluate the pricing model to see if we're still competitive. We want to be both proactive and reactive."

Miles Weiner, chief executive officer of VFC Inc., which runs the Visual Freedom Center in Columbia mall, said he expected little impact on pricing because, "The low-price providers already are not making money." His center charges $3,950, and offers a money-back guarantee that vision can be corrected to 20/20.

Discounting so far has been concentrated in Baltimore and California, unlike the rest of the country, where prices have remained stable, said David Harman, of Market Scope, the St. Louis publisher of the industry newsletter Refractive Surgical Market.

However, he said, two Canadian companies have announced plans to enter the U.S. market charging $2,000 for both eyes.

"Prices were going to go down regardless" of the change in fees charged by the laser companies, he said.

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