Wednesday, May 31, 2017

A Most Memorable Trip: The Soviet Union Before the Breakup - The Interesting Adventures of A Consultant

Irv Arons

In the summer of 1990, my wife and I were invited to join a People to People Ambassador Tour to visit the Soviet Union. The USSR didn’t break up into its member states until the following year, late 1991. So, we got a look at what turned out to be a huge national facade – a strong military front and a “third world” infrastructure.

I was part of a medical group (medical laser specialists) that visited several hospitals and laser centers (?) within Moscow (Russia), Tbilisi (Soviet Georgia), Kharkov (Ukraine) and in St. Petersburg (again, in Russia). Fortunately, my wife was able to join up with a group of performing artists that were also on an Ambassador tour and, while we (the medical group) were doing our hospital visits, they visited their Soviet  peers,.

For the record, Moscow was bleak, with the exception of our visit to the Kremlin, and the gift shopping – my wife got a beautiful amber necklace from a street vendor for $20, and I came back with a set of matryoshka (nesting) dolls, with Gorbachev on top and Lenin deep inside at the bottom). In contrast, Tbilisi in Soviet Georgia was colorful and hot (90 degrees when we were there). The Ukraine, our next stop, was the food basket of Russia, but because they had few refrigerated trucks, there was no way of moving the food into the cities! Our final stop was St. Petersburg (or Leningrad, whichever you prefer), which was beautiful. It is a land of rivers and bridges – and the Hermitage, the most beautiful museum that we have ever visited!

A brief anecdote – the day before our visit to the Hermitage, one of my colleagues ran out of 35 mm film and I gave him a couple of rolls of the 400 speed film that I was using. The next day, he replaced my rolls with a couple of rolls of 1000 speed film, which enabled me to take some beautiful pictures inside the Hermitage, including of the huge malachite urns and a couple of Rembrandt paintings (one of a man in a red coat - which I believe was a self-portrait, and Moses with his son Isaac on the mount) without needing to use a flash, which was forbidden inside the museum. I have included a few of these photos for your enjoyment – actually, the Rembrandt’s are from the web, as they are much better reproductions than I was able to achieve from my 35mm slides.)

We flew Aeroflot within the USSR – no seat belts, animals on board, and tea service served in cracked cups by heavy-set women with gold teeth! The planes were flown by military pilots, who were the first to get off, and the rear section of the plane was unloaded first to keep the planes balanced!

When we visited, most people worked for the state – and there wasn’t any work! So they would go to their jobs in the morning and, having nothing to do there, would be back on the streets by noon. It just goes to prove that the communist way of doing things didn’t work. There were no goods in the stores, and what we did see was both sparse and of poor quality (paper shoes?). And, long lines everywhere to get tobacco and vodka.

Based on my experiences, I published two articles about my trip; one about the state of healthcare (and lack of lasers) in the USSR, and a second on the state of eyecare in that part of the world. They are technical in nature but illustrate the differences between what the Soviet Union was telling the world and what we actually saw!

Here, for your further enlightenment, are the two articles I wrote about our (the medical groups’) experiences.

The State of Healthcare in the Soviet Union: The Lack of Medical Lasers
This article was published in both Medical Laser Industry Report, October 1990 and Laser Report, December 15, 1990.

Irving J. Arons
Arthur D. Little

During late July 1990, I was privileged to join a delegation of medical laser specialists and other health care professionals, under the auspices of the People to People Ambassador Program, invited to tour the medical community in the Soviet Union. Our group, organized by the American Society for Lasers in Medicine and Surgery, was composed of specialists in gynecology, plastic surgery, thoracic surgery, urology, general medicine, and myself, representing the field of ophthalmology. In addition to the ASLMS group, a veterinarian working with lasers, a health care safety specialist, and two medical technical/clinical lab specialists were included in our delegation.

We were able to visit a medical laser research institute in Moscow, and four hospitals, one each in Moscow (Soviet Russia), Tbilisi (Soviet Georgia), Kharkov (Soviet Ukraine), and Leningrad/St. Petersburg (Soviet Russia, again).

Our overall impression was that the facilities and equipment in use were woefully decrepit and/or non-existent or years behind Western standards. However, the medical personnel we met were dedicated professionals.

Of particular note, we found that the hospitals -- even one claimed to be only three years old -- were ill kept and falling apart. The facades were cracked and broken, the hallways and stairwells unswept, and the grounds surrounding the buildings not cared for at all. In counterpoint, we found the patient rooms were clean and staffed with dedicated nurses and doctors doing their best with what they had. This was particularly evident at the Karzigan Childrens Hospital in Moscow. The wards were filled with children with trauma of all kinds, but they were all smiling and very well cared for by an attentive staff of nurses and aides. It was here that we learned that a typical doctor with less than 10 years service earns between 240-260 rubles a month (the equivalent to about $40 at the official exchange rate of 6 rubles to the dollar, and only $20-30 at the black market exchange rate of 10-15 rubles to the dollar), a beginning research worker earns 140-150 rubles per month, and a surgical nurse get about 110 rubles for regular shifts. (In contrast, the bus drivers providing our transportation were paid 400 rubles/month and we were told that street sweepers earned as much as 700 rubles/month!)

The hospital equipment, especially for diagnosis and surgery, was particularly non-existent, and, according to our laboratory clinicians, the clinical laboratory equipment was barely adequate to care for the patients in the wards. But we must emphasize, both the hospital administration and medical staff were dedicated to providing the best care possible to their patients. What they lacked in equipment they more than made up with in numbers and dedication.

As for medical lasers, and new medical treatments using lasers, except for the laser institute in Moscow, the only lasers that the hospitals seemed to have were low powered therapeutic types, basically HeNes and GaAs infrared lasers. The hospital in Leningrad had several CO2 lasers, and claimed to have other surgical equipment, but we only saw therapeutic lasers in operation. We were told that only about 100 of approximately 15,000 hospital-based physicians in Kharkov have access to or use surgical lasers. We would guess that the percentages are not much different in the other 14 Soviet Republics. At the hospitals we visited, the majority of the half dozen lasers they claimed to have -- if they had any -- were either HeNe or GaAs therapy lasers, used to treat open sores, pain, and in one hospital in Tbilisi (Soviet Institute of Clinical & Therapeutical Research), for treating myocardial infarctions by clearing viruses in the blood through intravenous use of a HeNe laser connected to a fiber inserted through an arm vein. The same hospital also used a scanning HeNe laser to alleviate angina chest pain by scanning the laser beam across the patient's chest!

At a trauma hospital in Leningrad (The Ambulatory Institute Hospital), we saw a 40-50 watt CO2 laser in the corner of an operating room, and another upstairs in a storeroom along with the usual HeNe lasers. We saw no evidence of a YAG laser although the laser specialist at this hospital claimed to have just received one, but which he had not yet unpacked. In the same storeroom with the spare CO2 laser, we were told that a small laser sitting on top of packing crates was a new UV laser, apparently solid-state since there was no evidence of any gas bottles or connections for one. (An interesting side note, we observed a burn therapy ward at this hospital, and it was disconcerting to see flypaper strips hanging from the ceiling.)

At the hospital in Kharkov (The Central Regional Hospital), we were told that they had an Ar laser used in ophthalmic treatments (but we did not see it).

The National Research Institute of Laser Surgery in Moscow claimed to be doing considerable research with medical lasers, performing 47,000 laser procedures annually. It is supposedly, one of 52 laser centers in the Soviet Union. We were given a presentation about the clinical research they were doing with five types of high power lasers, mostly CO2 and YAG -- and two prototype free electron lasers, used for PDT studies. The FELs, according to the slides shown us, may be revolutionary, in that they appeared to be about the size of a large sized desk, much smaller than any other FEL I have seen -- and I have seen the Stanford FEL and pictures of others. Attempts to find out more about this laser development were fruitless, however I plan to get back in touch with my contact at the Institute to see if I can possibly learn more about this exciting laser development. (Several weeks after my return to the States, I received a call telling me that a defector from the Moscow Laser Institute wanted me to know that he had built the laser in question and it was not an FEL, but rather an electron beam generator pumping a chemical laser use in their PDT work.) When we asked to see their lasers, we were politely told that they were in another building and couldn't be shown to us. Apparently, the person holding the key to the lab was not available!

According to a profile of the Soviet healthcare community recently published by Medistat, a UK healthcare publication, what we saw in the Soviet Union this summer is typical and not out of line with what others have reported. The Medistat profile stated that the Soviet Union has some 23,000 hospitals with 3.6 million beds, and in addition, some 38,000 polyclinics and other outpatient centers. Capital investment in recent years has concentrated on the construction of new facilities to boost the number of beds, but many of the new facilities have been built at unsuitable sites, and the majority of Soviet hospitals having little in modern equipment with some lacking the basic necessities of adequate sanitary facilities or even heating.

The polyclinic is the main unit in the primary healthcare network, and the first point of contact for most Soviet patients. They serve districts of 50,000 to 60,000 inhabitants and are staffed by doctors responsible for around 2000 patients. In addition to general doctors, each polyclinic has specialists in area such as cardiovascular disease, oncology and renal medicine.

The Soviet Union has the highest number of doctors per capita, with a total of 1.3 million doctors serving a population of 275 million. In addition, there are 3.3 million medical assistants. Women doctors are well represented, accounting for about 70% of all doctors. (We were told the percentage was closer to 50%, at least at the facilities we visited.)

As you know, until recently, all planning was done centrally, and for five years in advance -- the so called Five Year Plan. The most recent healthcare plan was put together in August 1987. That five-year plan attempted to address the chronic underfunding of the healthcare system, calling for new hospitals while neglecting older ones which will now need to undergo drastic major refurbishment. Expenditures for medical equipment had also been limited in the past, with the majority of funds allocated for new buildings. But the new policy included allocation of more resources for the purchase of modern equipment, in particular the polyclinic facilities were to be upgraded with proper diagnostic and treatment services to enable the patients to be treated at the clinic rather than to be referred to local hospitals. According to Medistat, 5.4 million rubles had been allocated for the purchase of new equipment over the two year period 1988-1989.

Discussing the state of the Soviet medical equipment market, Medistat states that the USSR suffers from a chronic shortage of equipment, particularly in the high tech areas such as computerized scanning, ultra-sound, renal equipment, and as we found out, laser treatment devices. Even basic equipment such as electrocardiographs and routine surgical instruments and disposable syringes are in short supply, with the problem being further aggravated by the fact that much of the Soviet produced equipment is sub-standard.

The current five-year plan envisages accelerating development in the medical industry and raising the technological level both within its industry and in its healthcare facilities. We hope that this can be accomplished. It is sorely needed.

In the report above, I discussed the state of healthcare in the USSR as we saw it in 1990. The hospitals and care appeared to be at least thirty years behind similar Western facilities, with a lack of instruments and supplies and crumbling buildings, but with dedicated medical personnel.

At the urging of a friend, I have added a brief piece, taken from Wikipedia, about how the healthcare system in the Soviet Union (and more specifically Russia) has changed since I was there – and from the way it is described below, it really hasn’t!

Healthcare in the Soviet Union and Russia
Source: Wikipedia

Pre-reform health care

Pre-1990s Soviet Russia had a totally socialist model of health care with a centralised, integrated, hierarchically organised with the government providing free health care to all citizens. All health personnel were state employees. Control of communicable diseases had priority over non-communicable ones. On the whole, the Soviet system tended to primary care, and placed much emphasis on specialist and hospital care.

The integrated model achieved considerable success in dealing with infectious diseases such as tuberculosis, typhoid fever and typhus. The effectiveness of the model declined with underinvestment. Despite the fact that the quality of care began to decline by the early 1980s,medical care and health outcomes were on par with western standards. Despite a doubling in the number of hospital beds and doctors per capita between 1950 and 1980, the lack of money that had been going into health was patently obvious. Some of the smaller hospitals had no radiology services, and a few had inadequate heating or water. A 1989 survey found that 20% of Russian hospitals did not have piped hot water and 3% did not even have piped cold water. 17% lacked adequate sanitation facilities. Every seventh hospital and polyclinic needed basic reconstruction. Five years after the reforms described below per capita spending on health care was still a meagre US$158 per year (about 8 times less than the average European social models in Spain, the UK and Finland, and 26 times that of the U.S. which spent US$4,187 at that time).

Reform in 1991-1993

The new Russia has changed to a mixed model of health care with private financing and provision running alongside state financing and provision. Article 41 of the 1993 constitution confirmed a citizen's right to healthcare and medical assistance free of charge. This is achieved through compulsory medical insurance (OMS) rather than just tax funding. This and the introduction of new free market providers was intended to promote both efficiency and patient choice. A purchaser-provider split was also expected to help facilitate the restructuring of care, as resources would migrate to where there was greatest demand, reduce the excess capacity in the hospital sector and stimulate the development of primary care. Finally, it was intended that insurance contributions would supplement budget revenues and thus help to maintain adequate levels of healthcare funding.

The OECD reported that unfortunately, none of this has worked out as planned and the reforms have in many respects made the system worse. The population's health has deteriorated on virtually every measure. Though this is by no means all due to the changes in health care structures, the reforms have proven to be woefully indequate at meeting the needs of the nation. Private health care delivery has not managed to make much inroads and public provision of health care still predominates.

The resulting system is overly complex and very inefficient. It has little in common with the model envisaged by the reformers. Although there are more than 300 private insurers and numerous public ones in the market, real competition for patients is rare leaving most patients with little or no effective choice of insurer, and in many places, no choice of health care provider either. The insurance companies have failed to develop as active, informed purchasers of health care services. Most are passive intermediaries, making money by simply channeling funds from regional OMS funds to healthcare providers.

National Projects

In 2006 a national project 'Health' was launched to improve the country's healthcare system through improved funding and healthcare infrastructure. This plan helped equip hospitals and clinics with advanced, high-end equipment and ambulance systems, build new medical centers, as well as launch nation-wide vaccination programs and free health checks. The project has also been working on developing medical technology market through initiatives to blend healthcare and information technology. One of the focuses was made on salary increase of medical staff working in the primary care as well as their wider training programs.

The project was initiated by the Russian President Vladimir Putin and coordinated by the Presidential administration. It was mostly financed by the federal budget. However regional and municipal levels have also contributed a lot to the financing of the program.

Reform in 2011

After Vladimir Putin became president in 2000, there was significant growth in spending for public healthcare and in 2006 it exceed the pre-1991 level in real terms. Also life expectancy increased from 1991-93 levels, infant mortality rate dropped from 18.1 in 1995 to 8.4 in 2008. Russian Prime Minister Vladimir Putin announced a large-scale health-care reform in 2011 and pledged to allocate more than 300 billion rubles ($10 billion) in the next few years to improve health care in the country. He also said that obligatory medical insurance tax paid by companies for compulsory medical insurance will increase from current 3.1% to 5.1% starting from 2011.[27] Russia, anyhow, maintains several centers of excellence, such as the Fyodorov Eye Microsurgery Complex, founded in 1988 by Russian eye surgeon Svyatoslav Fyodorov. (See my next writeup,)

Eycare in the Soviet Union

This article was published in Vision Monday in August 1990.

Irving J. Arons
Arthur D. Little

I have just returned from a two week tour of four cities within the Soviet Union.  I had anticipated telling you about the state of eyecare within the USSR, but unfortunately, our visit to the premier Moscow Research Institute of Eye Microsurgery was canceled at the last minute, as we were informed by Dr. Fyodorov that the "Institute will be closed in July for preventative maintenance," and that "your visit at the term (sic) you have stated is inexpedient."  We had originally been invited following my February letter requesting to have our delegation visit the clinic. In fact, in late June we were told that we were welcome to visit the clinic, which was scheduled to shut down in August for holiday.

Apparently, the hotel we stayed at in Moscow, the Kosmos, is part of the Intourist program to provide visitors with eye care at Fyodorov's Moscow clinic.  We found a brochure advertising "Beautiful Eyes for Everybody," and describing how the Moscow Research Institute of Eye Microsurgery "treats 22,000 people annually, restoring or improving vision and removing the need to wear eyeglasses for many."  In addition to RK (radial keratotomy), the clinic claims to do laser treatment of secondary cataract, laser treatment of glaucoma, and laser treatment of "complicated myopia of high degree."  (It must be one of the only facilities with surgical lasers in the USSR, as we visited a laser research institute and three hospitals and saw very few surgical lasers -- mostly therapeutic HeNe and GaAs biostimulation type devices.)

The brochure goes on to state that your pre-operative stay is arranged at the Kosmos, and following the outpatient surgery, your post-operative treatment is done at the hotel by a team of qualified doctors and nurses.  Foreign patients are offered a program of excursions, including theater tickets (the ballet only costs 4 rubles -- the equivalent of 30 cents at the black market exchange rate) and other services offered by Intourist.  Fyodorov hopes to treat 20,000 foreigners a year by 1992.

A recent profile of Fyodorov in Fortune (May 1989) talked about the Fyodorov entrepreneurship, with his clinic being a $75 million a year business, and growing at 30% a year annually.  The clinics have over 5000 employers located at nine treatment centers across the Soviet Union, and include two factories producing eyeglasses and surgical instruments.  (In addition, Dr. Fyodorov recently spent some $12 million outfitting an 11,000 ton "floating eye hospital" called the Floks, which travels from port to port in the Persian Gulf offering RK and other eye surgeries.)

Having missed out on the opportunity to visit with Dr. Fyodorov, I would like to offer some personal observations about eye care in the Soviet Union.  As previously mentioned, our People-to-People delegation of medical laser specialists visited Moscow (Soviet Russia), Tblisi (Soviet Georgia), Kharkov (Soviet Ukraine), and Leningrad (back in Russia).  We saw very few optical shops (none that were open) and only a small number of Soviet citizens wearing eyeglasses!  One ophthalmologist at a central hospital in Kharkov told me that 50% of the people need corrective lenses -- similar to the percentages in the rest of the world -- but we saw very few people wearing lenses.  If 5% of the people in the streets had glasses, that's a lot.  This says that Western technology and entrepreneurship could provide a needed service in the Soviet Union if a way could be found to open (and stock) optical retail shops in the major cities.  However, you must remember that the average citizen only earns about 200 rubles per month (the equivalent of about $350/month at the "official" business exchange rate or about $10-15/month at the black market exchange rate of 10-15 rubles to the dollar).  Therefore, the price of eyewear would have to be low for the average person to be able to afford it -- unless the health care system can be convinced to reimburse or pay for the glasses.  (The government health care system pays Fyodorov's clinic the equivalent of $300 for each RK procedure carried out.)

If a Moscow McDonalds can generate hours long lines for a $5 "Big Mac", why not $20-40 eyeglasses at a Moscow Lenscrafters or a Leningrad Pearle Vision Center?

A First Trip to Japan: The Interesting Adventures of A Consultant

Irv Arons

In the summer of 1979, I had been hired to conduct a survey of all of the major contact lens companies operating around the world, for a US company interested in finding a partner for its contact lens company. I had completed my interviews of the companies in the US and Europe, and now had to interview the two companies producing lenses in Japan. Since this was my first trip to Japan, I decided to combine business with pleasure and took my wife along to spend a week on vacation, visiting Tokyo and Kyoto, before I was to meet up with a colleague from the Arthur D. Little (ADL) Tokyo office, who would act as my interpreter and take me to my meetings in Osaka and Nagoya.

The first leg of the trip was a three-day contact lens conference being held in San Francisco. There, I met up with a friend who ran a contact lens practice in Hawaii. Since he had clients who were on the management staff of Japan Airlines (who would be flying us from San Francisco to Tokyo), he was kind enough to arrange for my wife and I to be upgraded to First Class for our flight to Tokyo. (That was our first experience flying internationally in First Class and we liked it so much that I decided to upgrade our return tickets – at a cost of $600 each, as I recall, to fly First Class on our return flight from Tokyo to Boston. An excellent decision, as it was about a twelve-hour flight.)

We arrived in Tokyo and managed to find our way via bus from Narita airport to Tokyo Central Station, and to get a taxi to take us to our hotel, the Okura, in central Tokyo and near the ADL Tokyo office.

Our first venture out of the hotel was to the downtown shopping district of Tokyo. We had learned from our travel guide books that the best place to eat was at the restaurants located within the major department stores, up on the fifth floor. What the guide books neglected to tell us was that very few people spoke English and since we spoke only a few words of Japanese, we were left with only hand gestures!

At least at the restaurant, there were pictures of the several dishes available, and by pointing to the ones we wanted, we had a reasonable chance of getting something we could eat. But the next dilemma, the meals were served in a stack of bowls, and of course, with chop sticks. Was the top bowl broth or soup, or to wash your hands? And, if it is soup how do you eat it without spoons? Finally, another customer, sitting at a nearby table, sensing our discomfort, took pity on us and gestured to hold the bowl to your mouth and sip from it. So, that problem was solved.

The next day, I wanted to walk to the ADL Tokyo office that I was told was close by, so that I would know where it was for the following week when I had to check in. The street signs were a complete mystery and I had no idea how to get from the hotel to the office, even though I had instructions and a map!

Two Japanese men, passing by, sensed my dilemma and offered to help. After showing them the address of the office, they were kind enough to walk us right to the building, a very generous offer from strangers. The second offer of kindness to strangers from the Japanese people.

We had planned on spending a few days exploring Tokyo and then take a trip via the bullet train to Kyoto, the Japanese shrine city. However, our plans got changed because of a chance meeting at a coffee shop that afternoon.

An older gentleman introduced himself to us, while we were enjoying our coffee (or tea, I don’t recall). It turned out that he was a retired military officer, and also a former member of parliament. He offered to act as our tour guide and show us the real Tokyo and then take us to see Mount Fuji.

Since our plans were flexible, we agreed to his offer and arranged to meet him the following morning at the coffee shop for a guided tour of Tokyo. We hired a taxi for the day and our new guide took us to see and walk through the Parliament building and showed us several historic sites around the city. We ended that day with a visit to the Kabuki theater, being taken in through the people’s entrance and were able to watch the show from the first balcony. Quite an experience.

We enjoyed the tour so much, we agreed to let him be our tour guide the following day and take us to visit Mount Fuji, taking the bullet train (as long as we paid his fare). However, the weather didn’t cooperate and when we got to the mountain, it was completely fogged in. On the way back to Tokyo, we had another interesting experience. Three young women were on the opposite seats from us on the train and attempted to engage us in conversation. They claimed to be English teachers (or maybe students studying to be teachers) and wanted to practice their English with us. To be honest, we could barely understand them.

Since that was our last day of sightseeing, our gentleman guide asked us to meet him at a local Chinese restaurant that evening for a farewell dinner and to meet a few of his friends from the Kabuki theater. Little did we know that he had arranged for us to get the bill at the end of the evening and I got hit with a $250 check! (Recall that this was 1979, and the exchange rate for the yen was quite in my favor, about 350 yen to the dollar, but this was still an expensive meal!) I guess that was his way of getting paid back for acting as our tour guide for the couple of days we spent with him.

The next day, I left my wife at the hotel and made my way to the ADL Tokyo office to begin the business part of my trip, to visit the two contact lens companies in Nagoya and Osaka. (No wives allowed on business trips in Japan!)

Quite an interesting experience for my first trip to Japan!

My First European Trip: The Interesting Adventures of A Consultant

Irv Arons

Recall that I had toured Europe in the fall of 1979, visiting the various contact lens companies that were based there, as well as interviewing notable doctors involved in their use, on an assignment to assess the contact lens companies in both the U.S. and Europe for a Japanese client interested in acquiring technology for starting a contact lens business in Japan.

This was my first trip to Europe and I kept a diary of my daily travels – the first and only time I have ever done so. It’s a good thing I did, because there were several interesting incidents that occurred that you might enjoy.

I flew from Boston to JFK, to pick up my flight to London. I arrived in London at 10 PM, and quickly realized a had made a big mistake. I had a fairly large piece of luggage (I would be gone for over a week.), and hadn’t taken my wheels! (This was the fall of 1979, before wheeled luggage was in general use.) I made it onto the subway and got into London from Heathrow and finally found my hotel, the Bristol. Except they didn’t have my reservation! Luckily they had one room left and I took it and went to sleep without supper, as the kitchen wasn’t open at that time of night.

The next morning, I met my ADL colleague from our London office, who would be my traveling companion (and translator). It turned out, the London office had made my hotel reservations at another hotel, and forgot to notify me. (Again, these were the days before email.) We then went on to the several meetings that we had arranged in the London area. I went to the final one that evening by myself – no problem – they speak Bloody English!

That evening my colleague had arranged for us to meet at a nearby pub for a dinner show. I was quite surprised to find that he and his girlfriend had brought along another girl, his girlfriend’s roommate, whose boyfriend was out of town. After the dinner and show, I got dropped off at my hotel (alone) because we had a busy next day – four interviews and then flying off to Paris.

After our interview in Paris, the next day, we flew on to Strasbourg and our drive to Freiberg for a contact lens conference. We drove through very beautiful farm land and took a local inland route to the Rhine river and across into Germany at a local crossing. The border guards stopped us, took our passports, and searched our luggage thoroughly. They were puzzled by my voltage converter (European to 110v for my electric shaver), but after about ten minutes, finally allowed us to proceed into Germany and we went on to Freiberg and the CL conference.

I spent the weekend on my own, as my colleague took the train to Frankfort to spend some time with friends, after buying me a ticket for my Sunday train ride. Since I speak no German (although understand a little based on my Jewish background), I somehow managed to survive the weekend since I knew the word for chicken (hundchen!).

When I got to the train station on Sunday morning, I couldn’t figure out which track the Frankfort train was on, but luckily, some English gentlemen saw my dilemma and helped me out. It turned out that they were the world famous Amadeus Quartet and also going to Frankfurt. I thoroughly enjoyed my train ride talking to them.

Arriving at the Frankfurt station, I met my ADL colleague and we took the train to our next stop, Aschaffenburg. We arrived early in the evening, and after dinner, went to a movie and I saw Moonraker in German and didn’t understand a word of it!

Following our nearly all day meeting in Aschaffenburg, we took a taxi to the Frankfurt airport for our flight back to London. After leaving my luggage to walk to the gate, I thought I heard my name over the loudspeaker, but since the announcement was in German, I wasn’t sure. Sure enough, when we arrived in London, I quickly discovered that my bag was still in Frankfort.

I didn’t panic too much, but since we were going out of London the following day for two days of meetings, I decided all I needed was a clean shirt and some deodorant to get me through until my bag showed up in London. I quickly went out to try and find a shirt and the only store open had a dress shirt that set me back 27 pounds (or about $50). Finally, about 8 PM that night I got a call that my luggage had made its way to London and would be delivered to my hotel room. You can be sure I got up early the next morning, before our trip out of town and returned that $50 shirt! (I kept the deodorant.)

After a few meetings in London, we took the train to Birmingham, had a couple of meetings there and on to Loughborough.

After several meetings, it was on to Hitchins and then Hempel Hempstead. (Yes, I did get to see quite a bit of England on that trip.)

The next day was my last in England and after several more meetings, I made my way via the subway to the airport and finally got on my flight back to the States.

After what I saw of the beauty of Europe, I made a promise that someday I would return. (And, my wife and I did. A few years later we took a sixteen day tour of eight countries - “If it was Tuesday, it must be Belgium!” As it turned out, we did travel through Belgium on our way from Paris to Amsterdam on a Tuesday.)

We have since gone back to Europe several times, particularly to Switzerland and to Spain, and even took a river boat trip down the great rivers of Europe, from Amsterdam to Vienna, passing through sixty-six locks along the way.

The Soft Contact Lens Industry and My Role in its Growth: The Interesting Adventures of A Consultant

Irv Arons

The Bausch & Lomb Soflens, the original soft contact lens, was first approved for marketing in March 1972, My first contact lens assignment began in June of that year, an assessment of the “safety and efficacy” of the Soflens. Over the following fifteen years, I led over 150 assignments involving both soft and gas permeable contact lenses, becoming, in that period, the “guru” of the contact lens industry.

But one of the most interesting assignments, in the fall of 1979, involved my traveling all over the United States and Europe to investigate possible technical partners for a Japanese company interested in entering the contact lens business.

In September of that year, after completing my U.S. visits, I traveled to Europe, visiting London, Paris, Strasbourg, Frieburg, Frankfort, back to London and finally, home to Boston to prepare a final report. (For some anecdotes from my first trip through Europe, see the following writeup - My First European Trip.) In November I traveled to Tokyo to present the results of my study. An Arthur D. Little (ADL) colleague and I flew to Tokyo via New York City on a Friday, arriving on Saturday. The following day, Sunday, I returned a phone call to another client who had left an urgent message that he desperately needed to speak with me and that I should call him at home over the weekend.

At 8 AM Tokyo time, which was about 7 PM (the previous day) in the U.S., I reached Steve Martin of Ciba Geigy (the other client) and he asked me the strangest question. He told me that I was the No. 1 contact lens expert in the U.S., and he wanted to know who was No. 2? Apparently, his Swiss parent company had heard my name from so many people that they wanted another name to get another view of the industry. I told him that there wasn’t anyone else doing what I did and he agreed. He had himself made many calls around the industry and had only gotten my name. He said that he was going to let the Swiss people know this and would call me the following Thursday and probably give me another assignment.

As it was, he called me back the following Wednesday while I was still in Tokyo (leaving the next day to return to the states), and told me that he needed me to travel to Germany the following Sunday to evaluate the technology of a German contact lens company (Titmus Eurocon) in which he was interested. (Since I was planning to recommend the same company to our Japanese client, I politely asked him not to buy them until, at least, I could deliver our final report to the Japanese client!)

So, I arrived home that Thursday, wrote and sent my proposal to Steve (Ciba Geigy) and met him at the Newark airport that Sunday prior to my overnight trip to Germany. I was part of a four or five men team (the others being optometrists and ophthalmologists) who were being sent to Germany to evaluate the German company’s technology.

We flew overnight, arrived in country early the next morning and immediately went to work at the German company. After spending the day in discussions, the company officials offered to take us out for dinner and entertainment. With all of my recent travels, I was literally out of it and  politely declined and went to bed – I understand the rest of the group partied hard into the night – I have no idea how!

To make a long story short, after spending about three days in Germany, I came home, wrote my report and later heard that it was the influential piece of Steve’s presentation to management that gave him the go ahead to acquire the German company’s technology and to start CibaVision in 1980. He became its first president.

There are a couple of other stories about my role in advising companies that entered into the contact lens business. Here’s another that had an interesting twist.

Besides Ciba Geigy (CibaVision), I was also involved in the technical assessment of Frontier Contact Lens in Jacksonville, FL, for Johnson & Johnson, which they later acquired, and which became Vistakon.

In an earlier assignment for J&J, I did an assessment of Wesley Jessen in Chicago, but they passed on that company. However, about six months later, I was asked by Schering-Plough to visit in New Jersey about their potential acquisition of Wesley Jessen. I dutifully told them that yes, I had prepared a report on WJ, but I was under a confidentiality agreement not to discuss it. Schering said come on down anyway.

Lo, to my surprise, when I got to their offices, I was presented with a copy of my report and asked to discuss it! My guess is that the president of WJ (Orrin Stine) had given them a copy, given to him by the people at J&J. (I recently asked Orrin, but he doesn’t recall having a copy of my report.) Since I now felt that the confidentiality agreement was no longer valid, I did discuss my report and Schering did acquire WJ, which, as I recall, they later sold to Ciba.

So, I guess I did have quite an impact on the soft lens industry, both in the States and other parts of the world.

One last case and I’ll call it quits.

In August 1987, in a landmark case in the Tax Court in Wilmington, Delaware, ADL was hired by Baker & McKensy to assist in their representation of Bausch & Lomb in an international transfer pricing case against the IRS. It seems that B&L had transferred its technology to Ireland, where it was manufacturing most of its contact lenses then shipping them to the rest of Europe and to the U.S. for sale. This reduced substantially the amount of income B&L reported in the U.S. and allowed them to enjoy a much lower tax in Ireland. The questions before the Tax Court concerned the appropriate transfer price for the contact lenses and the royalty B&L Ireland owed to its U.S. parent company.

I was B&Ls contact lens industry expert and my ADL colleague, Dr. Irving Plotkin, their expert on foreign transfer pricing and royalties. (In fact he frequently worked both sides of the aisle, sometime being an IRS expert and other times working for the taxpayers!)

In any event, we prevailed and with a split decision by the tax court (mostly in B&L’s favor), saved B&L in the order of $15 million for the tax years in question, and perhaps tens of millions for succeeding years. This case set a precedent that became the law in international transfer pricing cases.

It was quite an experience being on the witness stand and being cross examined by the Government’s lawyers. In fact, I was so excited being in that position that I inadvertently answered one of the lawyer’s questions with a “Yes sir!”, when she was obviously a woman, who was very pregnant, and within weeks of delivering her baby!

If you are interested in reading more about my work in the contact lens industry, additional information can be found on my blog: The Nature and Evolution of the Soft Contact Lens Industry in the United States (the title of my expert report in the B&L vs IRS case).