Vision Correction - Current Technologies, Challenges, Innovations & China Market

Almost every human being needs some form of vision correction during his or her lifetime. Ever since the first use of reading glasses, inventors have been striving to perfect vision correction techniques in terms of accuracy, comfort, convenience, and until recently, aesthetics. In the modern age, population growth and aging alone have created huge, diversified and evolving demands for vision corrections. These are made possible by innovative approaches, such as advanced contact lenses and laser refractive surgeries enabled by the technological advancements in materials science and precision laser technology. Analysts from Bridge Point Capital performed a thorough analysis of the vision correction market through an in-depth understanding of the current market demand trends, challenges, and technology landscape. We strive to demonstrate a comprehensive industry prospective for our investors and collaborators.

What are the Major Vision Problems in the Market Today?

Prevalence and Market Size

It is estimated that nearly 200 million U.S. citizens, or about 3 out of every 4 adults, are wearing some form of vision correction today. This creates an enormous market for vision care products and services, which is estimated at $42.98 billion in 2019 and growing at a CAGR of 2.4%.

Common Types of Vision Defects and Demographics

Among the large patient population, the most common types of refractive errors include myopia, hyperopia, astigmatism, and presbyopia.

Myopia refers to the difficulty with seeing distant objects, and it occurs either if the eyeball is too long or the cornea, the major source of human eye’s refractive power, is too curved – causing to be blurred by focusing in front of the retina. In contrast, hyperopia refers to the opposite condition and results in impaired near vision. The onset of myopia or hyperopia is often with children at school age (between 6 and 15). Although presbyopia is also manifested as trouble with seeing objects close up, it is different from hyperopia in that the defects are caused by the hardening of the lens resulting from the aging of ciliary muscles. Therefore, presbyopia often haunts people after they reach 40 years old, and eventually, almost everyone develops presbyopia. Astigmatism refers to the condition in which the front surface of the eyeball has an oval or irregular shape that causes both near and distant objects to become blurry and distorted.

Traditional and Emerging Methods for Vision Correction (in millions)

Conventional Eyeglasses Remain Popular but May Not Be Sufficient for Consumer Needs

The most conventional method for vision correction is no doubt the prescription eyeglasses, which are currently worn by 165 million out of 200 million patients in the U.S. This old-fashioned method may be effective in satisfying the basic needs for vision correction, yet it is not sufficient when evolving demands, such as convenience and aesthetics, are taken into consideration. Consumers, especially the younger generation, typically do not endorse the idea of carrying something that fogs up in cold weather, gets in the way of their favorite sports, and blocks their facial features.

Additionally, myopia becomes increasingly prevalent amongst other refractive errors and affects the young generation the most. Myopia is currently affecting 1/3 of the U.S. population and almost 90% of the population in some East Asian countries, and the average rate of progression between 8-15 is deteriorating approximately 0.5D per year. Moreover, the issue is starting to affect the even younger population as the myopia rate for children under 6 reached over 12% in Asia in 2012. According to the prediction by the American Academy of Ophthalmology, 50% of the global population will be suffering from myopia by 2050! This will require new efficient intervention methods to be invented and validated in the next three decades.

The mechanism behind myopia progression is multi-fold, and it cannot be efficiently managed with conventional methods like eyeglasses since it is not as simple as getting images to be correctly re-focused onto the retina. In fact, studies have shown that wearing single vision prescription eyeglasses tend to progress young children’s mild myopia into pathological myopia (>-5D), hence it should not be considered as a proper intervention. According to a report from the World Health Organization, children in particular with pathological myopia can induce serious complications including glaucoma, cataract, retinal detachment, and even blindness at significantly higher risks.

Contact Lens

The disadvantages in the convenience and aesthetics of traditional eyeglasses have persisted for a while. It even bothered people enough that in the 1950s, the first pair of contact lenses were invented. Nowadays, contact lenses are made with materials with high water content with significantly less distortion and no obstruction in the peripheral. Admittedly, contact lens is more invasive than eyeglasses since it contacts directly with the cornea, and can lead to microbial keratitis, an infection of the cornea caused by bacteria. Improper fitting skills, cleaning and storage may all elevate the risk of developing such a complication. These factors especially pose threats to the young generation. Although the introduction of daily disposable contact lenses largely addressed the necessity of periodic cleaning and appropriate storage, it’s infeasible for ordinary users to completely eliminate the risk of infections. Thus, practitioners and parents have to consistently pay attention to young wearers to minimize this risk.

Vision Correction Surgery – the Evolution

Schematic Illustration of Three Generations of Laser-Based Refractive Surgery

ICL Implantable Lens

Despite the enhanced yet temporary experience of wearing contact lenses, patients and inventors want to go beyond the idea of carrying an external device and create a longer-term solution. This gives rise to refractive surgeries that utilize laser technology to write corrections directly in the patient’s eyes to achieve long term correction. The first-generation laser refractive surgery is called photorefractive keratectomy (PRK), which involves the removal of the epithelium – the top layer of the cornea, followed by the reshaping of the underlying tissue. Laser-assisted in situ keratomileusis, or LASIK surgery, the successor of PRK, involves the creation and lifting of a thin flap on the cornea by femtosecond laser to allow the reshaping of the underlying tissue without having to remove the top. This newer approach is less invasive than PRK.

Small incision lenticule extraction (SMILE) surgery, the 3rd generation of the corneal refractive procedure, took a friendlier approach wherein refraction change is made by removing a small corneal lenticule cleaved by femtosecond laser through a micro-pinhole incision created on the cornea, also by femtosecond laser. Besides the corneal reshaping methods, the implantable contact lens (ICL) surgery refers to the process where an artificial lens will be inserted between the iris and natural lens to achieve refractive change. The landscape of existing vision correction surgery equipment and manufacturers is outlined in the table below. SMILE and ICL are currently under an absolute market monopoly due to their patented position in the market:

Major Equipment and Manufactures in the Vision Correction Surgery Space

Challenges with Current Vision Correction Methods

Hard to Address Multiple Vision Problems for One Individual

While the existing package of vision correction methods is capable of addressing a single vision problem for one individual, a combination of multiple vision problems is hard to be addressed at the same time. For example, the combination of presbyopia developed at mid-age and myopia developed at a younger age is much more difficult to treat with existing technologies.

Challenges with High-performing and Cost-effective Multifocal Contact Lenses

With multifocal contact lenses, current products in the market are uncomfortable and expensive due to challenges with current manufacturing and storage. The combination of a convex lens and a concave lens built in the contact lens structure increases the thickness of the lens. Wearing thick contact lenses that are not breathable can cause dry eye and other challenges. In addition, these products need to be manufactured in specific combinations of prescription gradations to meet the needs of different patients. As a result, large inventories with 2 to 5 years of shelf life needs to be carried. There is simply no high-performing multifocal toric contact lens for the correction of presbyopia and astigmatism. Existing products leave a large space for improvements in the aspects of comfort level, correction outcome and costs.

Laser Refractive Surgery – High Invasiveness Leads to Low Penetration Rate and Unideal Outcome

With vision correction surgery, the current market penetration rate is as low as 1 to 2%. This is largely due to the patients’ fear of the surgical and invasive nature of existing techniques. The PRK surgery has been generally phased out since the removal of epithelium creates a lengthy recovery period and a large incidence of high-risk complications. LASIK, in spite of being less invasive than PRK, is still plagued with complications associated with the creation of the corneal flap. These may include irregular astigmatism, epithelial ingrowth, inflammation, and dry eye syndrome, all of which may pose a greater threat to more severe vision damage. SMILE is usually safer with fewer side effects. However, a major downside is that it only treats certain conditions of myopia, but not other refractive errors.

Since all aforementioned methods somehow require one or more of ablating, removing or damaging corneal tissue and nerves, they share a common drawback of triggering certain biochemical changes during the cornea’s regeneration process, which may significantly affect vision. Another common disadvantage is that they all have a certain requirement for the thickness of the cornea, which limits the size of eligible patients and the options for future vision correction procedures to make adjustments or correct new problems that develop over time.

Although ICL takes a different approach, it is not exempted from all the drawbacks of incising the cornea. Further, artificial lens implantation creates the problem of increasing the intraocular pressure, which can potentially lead to permanent vision loss! Serious complications including cataract development, endothelial cell loss, and pigment dispersion-related glaucoma can arise from the improper sizing of the lens and the contact between the artificial lens, natural lens, and iris. Therefore, a completely non-invasive technique that can address all the common types of refractive errors is urgently needed to drive wider adoption, by addressing the downsides of existing techniques.

Ineffective Myopia Control

The current treatment options include bifocal or multifocal spectacles, gas permeable contact lenses, orthokeratology contact lenses (OK lenses), soft multifocal contact lenses, and topical pharmaceutical agents.

Bifocal or multifocal spectacles and gas permeable contact lenses have been proven to be ineffective for myopia control. Orthokeratology contact lenses and soft multifocal contact lenses are proven to be effective but with major side effects. Topical pharmaceutical agents such as atropine or pirenzepine, delivered in the form of eye drops, are effective but have the greatest side effects such as photophobia and reduced near vision.

OK lens is worn at night, which is associated with an increased risk of microbial keratitis. OK lens may lead to long-term and even permanent changes in corneal shape which may cause other complications. Additionally, practitioners have noted that improper fitting skills can certainly lead to corneal damage. This poses a serious threat considering the major wearers are children. In comparison, soft multifocal lenses are worn during the day and fitted more commonly. However, existing soft multifocal lenses are not ideal because of the limited oxygen permeability, thus can cause reduced tear film stability, reduced cornea thickness, and damage to conjunctival surface cells.

Finally, the aforementioned challenges for manufacturing and storing customized multifocal contacts applies for myopia control products as well.

While central distance vision is corrected, conventional spectacles and single vision contact lens create peripheral hyperopic defocus (top), which encourages eye growth and the development of myopia. In contrast, orthokeratology contact lenses and soft multifocal contact lenses create peripheral myopic defocus (below), which slows eye growth and achieves myopia control

Laser Induced Refractive Index Change (LIRIC): The Next-generation Vision Correction Technique

Developed by Clerio Vision based in Rochester, NY, LIRIC is the first in the world, 100% non-invasive laser vision correction technology. The technology was spun out of years of research by Dr. Donna Strickland (the winner of the Nobel Prize in Physics 2018), the University of Rochester, and Bosch & Lomb. LIRIC involves the utilization of a tightly focused, low-energy, and high-repetition-rate femtosecond laser to non-surgically alter the refractive index of transparent materials and tissues including cornea, contact lenses, and artificial intro-ocular lenses.

LIRIC as a Breakthrough Technique for Laser Refractive Correction Surgery

LIRIC technology enables the delivery of better-performing, more comfortable, and safer contact lenses. First rolled out in creating clinically better performing multifocal toric contact lens for correcting presbyopia and astigmatism, LIRIC demonstrated the capability of providing significant near vision improvements without sacrificing distance vision in clinical testing. In addition, as LIRIC technology enables the tailoring of prescriptions to an individual’s conditions, manufacturers no longer need to maintain large inventories with specific degradations. The potential of LIRIC does not stop with presbyopia since the technology carries the potential of supporting the creation of an entirely customized lens that tackles all aspects of aberrations for each individual patient. True personalized medicine!

LIRIC Multi-focal Contact Lens for Multiple Vision Problems and Myopia Control

LIRIC technology enables the delivery of better-performing, more comfortable, and safer contact lenses. First rolled out in creating clinically better performing multifocal toric contact lens for correcting presbyopia and astigmatism, LIRIC demonstrated the capability of providing significant near vision improvements without sacrificing distance vision in clinical testing. In addition, as LIRIC technology enables the tailoring of prescriptions to an individual’s conditions, manufacturers no longer need to maintain large inventories with specific degradations. The potential of LIRIC does not stop with presbyopia since the technology carries the potential of supporting the creation of an entirely customized lens that tackles all aspects of aberrations for each individual patient. True personalized medicine!

Besides targeting matured vision problems, Clerio Vision is planning to launch its myopia control lens to effectively address myopia progression. Through utilizing the customizability of the LIRIC technology to implement innovative lens designs, the product is expected to offer a significantly more effective, safer and more comfortable option to manage the myopia progression.

Market Potential in China

There are ~700 million people in China who need vision correction presently. The market size in China is estimated at around $14B in 2018 and expected to reach $27B by 2022, expanding at a CAGR of 12%. For refractive surgery alone, the number of eligible patients is estimated to reach 200M by 2020. In 2018, nearly 1 million procedures were performed, however, the penetration rate was estimated at only 0.6% of the addressable market. Assuming the costs per refractive surgery is around $2,100 (15,000 RMB) and a market penetration rate of around 1% in 2020, the market size we estimated to be at least $3.5B. By 2025, the number is expected to double assuming a penetration rate of 1.6%. As of today, equipment and technology for laser refractive surgery in China solely rely on imports, which is not likely to change in the next few years.

The Chinese market for contact lens is also very promising. The market size was estimated at $1.1B in 2018, maintaining a steady growth rate of 10%. Overseas enterprises, including Bosch & Lomb, Johnson & Johnson, and Ciba vision have been in dominant positions with their innovative technologies in materials and correction approaches, while domestic players like Hydron have also established a footprint with cost-effective products for everyone.

Myopia is the most serious refractive error that is affecting the Chinese population at an increasingly younger age. According to the research conducted by the Ministry of Education of China, the myopia rate for elementary school students grew from 20% to 46%, and 48% to 74% for middle school students between 2000 to 2014. For high school and university students, the myopia rates are at alarming levels of 80 to 90%.

Myopia Rate for Students in China, 2000- 2014

In China, the young generation continues to suffer from enormous academic stress in order to be accepted at a good university. Recently, the issue has received serious attention from the Chinese government. Eight national-level departments including the State Council, the Ministry of Education, and the National Health Commission collectively issued the ‘Comprehensive Plan for Preventing and Controlling Myopia among Children’ in August 2018. The plan recognizes the current situation and outlines a series of implementable actions to achieve the goal to decrease the myopia rate for children under 6, elementary school, middle school, and high school students to 6%, 38%, 60%, and 70% respectively by 2023. Notably, the plan requires any hospitals beyond the county level to deliver appropriate vision care services, interventions and treatments. We foresee that the large and rapidly expanding young population of myopia patients in China will continue to drive the issue of evolving regulatory policies that favor the entrance and adoption of promising vision correction techniques by medical institutions and patients.