Ophthalmic device companies, like the rest of the US economy, are beginning to feel the effects of the global financial crisis. AMO has recently lowered their foretasted revenue range for 2008. “The change in guidance reflects our view that deteriorating economic conditions are impacting our U.S. and European refractive procedure and system sales more significantly than we had previously anticipated,” said Jim Mazzo, AMO chairman and CEO.

This is to be expected given the rest of the economy. What is not intuitive is the fact that in the same report AMO stated “Our cataract business, which is our largest and not generally economically sensitive, has continued to achieve strong growth in all geographies versus year-ago levels.

So why is cataract surgery different? We can not (and do not!) speak for AMO, but generally this can be explained with one word, Medicare. Medicare (and most insurance plans) cover cataract surgery, and the standard IOL that is used. This means that cataract surgery patients pay very little out of pocket for their surgery, and thus can continue to have surgeries, despite the economic down turn.

How long will this last? Accommodating lenses are poised to change the entire outlook on this issue. Accommodating lenses, and multifocal lenses, are not covered by Medicare. This means that patients must pay out of pocket, both for the new lens, and for the fee the surgeon charges to implant it. Given this, can it be expected that accommodating lens makers will continue to do well given the crumbling U.S. economy? How are patients, who are clearly already cutting back on health care expenditures, due to the economy, expected to pay thousands of dollars on their own?

Many inside the industry suspect that as the economy continues to fall, so too will accommodating lens purchases, despite the traditional success of cataract surgery during economic slumps.