Memorandum in Opposition A.4530 (Dinowitz) / S.4106 (Boyle) in Relation to Pricing Policies for Contact Lenses

Tuesday, March 3, 2015

About MedTech

MedTech is a trade association which connects New York State’s bioscience and medical technology (Bio/Med) industry through collaboration, education and advocacy. We are an active association of over 100 pharmaceutical, biotech and medical technology companies, their suppliers and service providers and research universities. For over 10 years we have boosted the success and growth of our members and the New York Bio/Med industry.

New York is among the top tier of states in the size of its bioscience industry, which includes vision care, and the scale and reach of its bioscience research complex, employing nearly 75,000 in the biosciences. The Bio/Med industry also plays a vital role in New York's economy supporting more than 205,000 jobs across all industries statewide and contributing $62.6 billion toward Gross State Product (includes direct, indirect and induced impacts.)

Statement of Opposition

MedTech respectfully requests your opposition A.4530 / S.4106, which would deem unlawful unilateral pricing policies for contact lens sales which heretofore have been recognized as appropriate business practices in the contact lens industry and throughout the U.S. economy.

The majority of consumer product manufacturers put in place some form of distribution requirements including quality standards, code of conduct and advertising/display standards. If a retailer fails to meet these standards the manufacturer may choose to cease doing business with the retailer. Similarly, manufacturers may adopt a “unilateral pricing policy” which sets a minimum price for products and if the retailer sells below that price the manufacturer retains the right to cease doing business with the retailer. Manufacturers implement such pricing policies for a variety reasons including capturing research and development costs and to lower retail prices as prices tend to migrate to the minimum price point.

Unilateral pricing policies have long been recognized as an appropriate business practice by the courts and the Federal Trade Commission. Manufacturers have the right to suggest retail prices and choose with whom they do business. Ignoring theses longstanding legal principles, the bill would deem unilateral pricing policies illegal regardless of the impact on competition and the consumer, a move which would isolate New York as the only state to take such a position for no apparent reason. Ample statutory remedies already exist at both the federal and state levels.

We also find unpersuasive proponents’ arguments that somehow the contact lens business is unique and calls for heightened protections. The contact lens industry is robust and highly competitive with the consumer maintaining ultimate choice in contact lenses or other eye care.

For the above reasons, MedTech respectfully requests your opposition to A.4530 / S.4106.

For additional information please contact Jessica Crawford, President of MedTech at 315-423-7200 or jcrawford@medtech.org.

View letter as PDF.

 

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