- In 1992, Eyefresh (a subsidiary of Johnson &Johnson) launched the first disposable contact lens, Keen Vue, which was produced by a unique proprietary manufacturing process at a cost of $0.50 per lens. Patients wore these lenses for 1 week, threw them away, and inserted another pair. By 1990, the health risks of extended wear lenses led some Eye Care Professionals (ECPs) to recommend that patients remove and clean Keen Vue lenses each night-replacing them after two weeks. So in 1991, Eyefresh launched SharpVue disposable lenses which were specifically designed for this type of usage. They were priced the same as KeenVue, $2.50 to ECPs and $4.50 per lens to end users. In 1993, Eyefresh planned to launch One Day Keen Vue, daily wear, single-use, truly disposable lenses that offer both convenience and reduced health risk. Each One Day lens cost $0.25 to manufacture and was priced at $0.65 to ECPs, and $0.83 to end users. 1 Which of the three products is most profitable? 2 Which of the three products is most profitable after accounting for differences in usage rates? 3 Should we use contribution per lens, or contribution per user as a price metric? Under what conditions would contribution per lens be more appropriate as a metric? (Hint: the answer may vary if Eyefresh had a capacity constraint and could not satisfy all demand) 4 What more can Contribution Analysis tell us about the challenges One Day might face? - In 1992, Eyefresh (a subsidiary of Johnson &Johnson) launched the first disposable contact lens, Keen Vue, which was produced by a unique proprietary manufacturing process at a cost of $0.50 per lens. Patients wore these lenses for 1 week, threw them away, and inserted another pair. By 1990, the health risks of extended wear lenses led some Eye Care Professionals (ECPs) to recommend that patients remove and clean Keen Vue lenses each night-replacing them after two weeks. So in 1991, Eyefresh launched SharpVue disposable lenses which were specifically designed for this type of usage. They were priced the same as KeenVue, $2.50 to ECPs and $4.50 per lens to end users. In 1993, Eyefresh planned to launch One Day Keen Vue, daily wear, single-use, truly disposable lenses that offer both convenience and reduced health risk. Each One Day lens cost $0.25 to manufacture and was priced at $0.65 to ECPs, and $0.83 to end users. 1 Which of the three products is most profitable? 2 Which of the three products is most profitable after accounting for differences in usage rates? 3 Should we use contribution per lens, or contribution per user as a price metric? Under what conditions would contribution per lens be more appropriate as a metric? (Hint: the answer may vary if Eyefresh had a capacity constraint and could not satisfy all demand) 4 What more can Contribution Analysis tell us about the challenges One Day might face