Bausch & Lomb News

Associated Press Update 4: Bausch & Lomb Shares Drop on CDC Report

Shares of Bausch & Lomb Inc. fell sharply Wednesday after the federal Centers for Disease Control confirmed more cases of a serious eye infection and concerns grew that the fungus may be linked to more of its contact lens products than originally suspected.

Shares of the Rochester, N.Y., eye care company fell $4.78, or 9.8 percent, to close at $43.97 on the New York Stock Exchange.

The stock had already lost 28 percent of its value this year amid concern over the safety of its products and as the company grappled with accounting troubles in recent months.

The CDC reported Tuesday that 191 infection cases were confirmed or under investigation in 29 states. Of those, 86 have been confirmed as Fusarium keratitis, which without eye drop treatment can scar the cornea and blind its victims.

Bausch & Lomb pulled its ReNu with MoistureLoc solution off store shelves in the United States in April after the CDC said it was scrutinizing a flurry of Fusarium keratitis infections in Americans using that or other Bausch & Lomb products.

U.S. health officials have found no direct link between MoistureLoc and the infections. But a high proportion of patients interviewed had used the brand, which first hit stores in late 2004 and contains new-generation moisturizing and conditioning agents.

A smaller percentage said they had used ReNu MultiPlus or another Bausch & Lomb product, while a handful of patients reported using products from competitors Advanced Medical Optics Inc. and Alcon Inc., the CDC said. Shares of those companies were virtually unchanged Wednesday.

Bausch & Lomb said in a statement that it is cooperating with the CDC and the Food and Drug Administration "to determine the root cause of the unusual incidence of fungal keratitis."

Company officials were scheduled to review the data with the CDC Wednesday.

"We're looking at every possibility," Chief Executive Ron Zarrella said in a videotaped message posted on the company's Web site. "Some of our experts believe it's possible that a number of factors could have come together to create a kind of perfect storm to allow this fungus to take hold."

Meanwhile, the company continued on its Web site to recommend that former MoistureLoc users switch to the MultiPlus or original ReNu Multi-Purpose solution "or another respected brand."

Bank of America analyst David Maris, citing the new CDC numbers, suggested that could change, saying the risk of a larger recall was increasing.

"BOL's previous explanation ... on their rationale for suspending sales of MoistureLoc and not other lens care products was that they believed the overwhelming majority of cases were with MoistureLoc," Maris wrote in a note to clients Wednesday.

Public health investigators said they have complete data on 58 cases of Fusarium keratitis. Of those, 56 were contact lens users, and 32 of them had used Bausch & Lomb ReNu with MoistureLoc, 15 had used ReNu MultiPlus and seven had used an unspecified ReNu solution.

The CDC said three patients had used an Alcon solution, and three had used one from Advanced Medical Optics.

Zarrella said the reported increase in cases was expected given the intense publicity and increased diligence by eye care providers.

"It's not clear if these cases represent a growing trend or if they are already in decline," he said.

Last month, it was revealed that Bausch & Lomb's manufacturing plant in Greenville, S.C., which has been at the center of the investigation into what's causing the infections, was cited by the FDA in 2002.

The company faces numerous lawsuits related to the infections, including one filed Tuesday by a 69-year-old woman in West Palm Beach, Fla.

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