Advanced Medical Optics Inc.’s bill for its contact lens solution recall: a steep loss and sharply lower sales.
The Santa Ana-based company delivered the news last week while saying it hopes to drive a comeback by stressing safe use of its solutions with contact lenses.
“The market has really spoken out and said we need something to increase compliance,” Chief Executive James Mazzo said on a conference call last week.
In the world of contact lens solutions, “compliance” refers to users following recommendations for cleaning contacts to prevent infection.
In September, the company plans to come out with a new version of its Complete MoisturePlus multipurpose solution that stresses more thorough cleaning of lenses by users.
In late May, Advanced Medical voluntarily recalled Complete MoisturePlus after the product and others were linked to a rare eye infection, Acanthamoeba keratitis, which can cause blindness.
For the year, the company said last week it sees the recall driving a loss of up to $69 million, versus a profit of $93 million expected earlier.
The loss reflects the cost of the recall and the pending launch of a revised formula.
Sales for the year could come in at $1.05 billion to $1.07 billion, down from an earlier range of $1.15 billion to $1.18 billion.
Advanced Medical said it sees a return to profitability next year, though at a lower level than previously expected.
The recall has proven costly, given that contact lens solutions make up only about a quarter of Advanced Medical’s $1 billion in yearly sales. Eye surgery devices are the bulk of sales.
Even so, Advanced Medical remains “fully committed to the eye care business as a fundamental part of our long-term strategy,” Mazzo said.
When Complete returns to store shelves, the packaging is set to include cleaning instructions to remove and kill a broad range of bacteria, microorganisms, lipids and proteins on contact lenses, according to Mazzo.
The directions are expected to urge users to rub contact lenses clean using their thumb and finger.
Many solutions, including the recalled version of Complete, carry “no-rub” designations, allowing users to just soak and rinse their lenses.
Advanced Medical’s rivals may not follow suit, according to published reports.
Ciba Vision, a unit of Novartis AG, hasn’t decided to change its no-rub designation and doesn’t discuss potential strategies until they’re finalized, a spokeswoman said.
Alcon Inc., a Fort Worth, Texas-based unit of Nestl & #233; SA, is confident in its solutions, “even when lens wearers do not rub their lenses daily,” spokesman Doug MacHatton said in a statement.
Bausch & Lomb Inc. of Rochester, N.Y., said it plans to follow the Food and Drug Administration’s lead on the lens rubbing issue. Bausch & Lomb, which recalled a version of its ReNu MultiPlus solution last year after it was linked to a different eye infection, did bolster a label suggestion that patients follow instructions from their doctors, who often recommend rubbing.
Last week, Advanced Medical was tight-lipped about whether it still is interested in buying Bausch & Lomb. Just prior to the recall, Advanced Medical said it would be willing to top an offer of $3.67 billion that Bausch & Lomb already accepted from private equity firm Warburg Pincus LLC.
