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Bladeless surgery seen as way to boost Lasik appeal

Advanced Medical Optics plans to buy IntraLase and set a new, all-laser standard.

January 09, 2007|Daniel Yi | Times Staff Writer

The country's leading maker of Lasik eye surgery equipment hopes that a deal it announced Monday will make the vision correction procedure more popular with consumers.

Lasik eye surgeries -- which can cost thousands of dollars and usually aren't covered by insurance -- grew in popularity during the 1990s but slowed amid the 2001 recession. The numbers are slowly rising again, but some patients are skittish about having blades inserted into their eyes, experts say.

Santa Ana-based Advanced Medical Optics Inc. thinks it can nudge more people to have the procedures by cutting the blade out of the process.

On Monday, the company announced plans to buy Irvine-based IntraLase Corp. for $808 million. IntraLase makes a machine that allows doctors to do Lasik without a blade.

Lasik, or laser-assisted in-situ keratomileusis surgery, is a two-step procedure in which a flap is cut in the cornea, traditionally with a blade. Then, a laser is used to reshape the eye so it can properly refract light.

IntraLase's technology, introduced in 2001, allows what is called an "all-laser Lasik," a more expensive procedure that now accounts for about a quarter of Lasik procedures, according to Market Scope, a St. Louis-based market research company.

How much better the results are with an all-laser procedure is still being debated, said Mark Dlugoss, editor of the trade publication Ophthalmology Times.

Most in the field agree that lasers make a more accurate cut, thus leading to fewer chances of complication, Dlugoss explained. But in the decade or so that Lasik surgeries have been around, doctors and blades have improved as well.

However marginal or significant the advantages of laser, the technology is still convincing to patients who are skittish about having sharp metal objects drawn to their eyes, even if in the hands of doctors, Dlugoss said.

"It is definitely a selling point," he said.

IntraLase, the only company to market the blade-less technology in the U.S., has gained ground rapidly. According to Market Scope, the number of Lasik surgeries peaked in 2000 at 1.44 million, then declined steadily to 1.15 million in 2003. It was back up at about 1.40 million last year, said David Harmon, Market Scope's president.

The acquisition would give Advanced Medical Optics -- which provides equipment to 60% of the Lasik vision correction market -- an opportunity to set IntraLase as the new industry standard, Harmon said.

For Dr. Roger Steinert's patients, it already is the standard.

"Within a few years, you won't see [blades] anymore," said Steinert, one of the nation's pioneers in Lasik surgeries and a professor of ophthalmology at UC Irvine and director of its UCI Refractive Surgery Center, which has offices in Orange and Irvine.

Lasik surgeries cost on average $1,950 per eye, according to Market Scope. An all-laser procedure adds $400 for each eye.

"Most patients realize that when your eyes are at stake, this is not the time to look for the blue-light special," said Steinert, who added that when he started using IntraLase three years ago, many of his patients who were once skittish about Lasik decided they were now ready.

Investors seemed to bet more people would do the same. Advanced Medical Optics' shares rose $1.62, or 5%, to $35.61 on news of the deal. IntraLase shares jumped $2.28, or 10%, to $24.51, close to the $25-per-share offer by Advanced Medical.

The planned acquisition, which was approved by the boards of both companies, must still pass muster with federal regulators. The companies said they expected to complete the deal by the end of the second quarter.

In a statement released Monday, Advanced Medical Optics Chief Executive Jim Mazzo said the acquisition offered significant strategic value to his company.

Most of the senior managers at IntraLase are expected to leave the company once the deal is completed, the companies said.

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