Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Michael Weinstein - JP Morgan
Michael Weinstein - JP Morgan
Basically J&J disclosed today at its Analyst Meeting that one, an astigmatism lens is being launched this month in the US and now its available globally. Two they also are coming out with a silicone hydrogel lens on the daily disposable side utilizing a new silicone hydrogel material there. And they also disclosed that they’re completing the clinicals on their drug delivery lens for ocular allergies and they expect to file that later this year. Just given that you won’t have a silicone hydrogel toric offering until 2009 does this change your view at all on toric share for the balance of the year? And what do you think your prospects are for a daily silicone hydrogel lens and then do you have an internal program and have you made any progress in developing a drug delivery lens of your own to compete with J&J?
Robert Weiss
As far as—we haven’t really quoted our toric market share other then to say that once we come out with our own product line in the silicone hydrogel space that we expect to hold it, but coming off of a 33 worldwide we don’t have our own expectations of holding share. Having said that, dealing with Oasis—Oasis is coming out with another two-week spot where Acuvue Advance for astigmatism is Triple A. Price the same thing. There are two reads on that. Historically J&J has done a trading-up mode from Acuvue Two to Acuvue Advance and then from Acuvue Advance to Oasis. Well they’ve been trying to trade-up 20% or 30% each step-up, interestingly they’re not trying to do it with Oasis, they’re listing the price the same. And $24.00 a six-pack is what it’s being listed at. It seems to me what they’re doing is somewhat defensive. That Acuvue Advance for astigmatism is not the product they want to go with longer term.
The other thing to keep in mind is typically a doctor will not move from a monthly modality to a two week modality so they’re coming into their same sweet spot of the market not finding their way into the monthly modality market; my opinion. Secondly the—as it pertains to the fact that they’re already in the two-week space, the fact that Acuvue Advance for astigmatism has been out there and doing pretty well, those people that wanted to trade to a two week silicone hydrogel lens by and large have traded over a long time ago. So those that are believers in the hydrogel side of the market and its clearly among other things, it’s the argument of if I’m taking them out every day I’m more concerned about the comfort level and there’s just enough of a cult that believes in the softness and the hydrogel attributes, higher water content for example, that I would argue while it isn’t a positive for all competitors by and large its not a big deal. It’s mainly them trying to hold on to what they’ve got.
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