UPDATE 1-FTC looking at Valeant's contact lens dealings -source
(Adds Reuters source, details of FTC probe)
Oct 27 (Reuters) - The U.S. Federal Trade Commission is looking into whether Canadian drugmaker Valeant Pharmaceuticals International Inc illegally cornered the market for a component of a new type of contact lens, an industry source told Reuters.
Valeant said on Monday it had received a letter from the FTC on or about Oct. 16 seeking more information about Valeant's recent acquisition of Paragon Vision Sciences, which produces a material used to make gas permeable lenses.
That probe focuses primarily on a small subset of the contact lens market, Ortho-K lenses, according to the contact lens industry source, who asked not to be named to protect business relationships.
The Ortho-K lens, when worn overnight, reshape the patient's cornea to counteract nearsightness and other vision problems.
After acquiring the Paragon Vision Sciences in May, Valeant obtained a de facto monopoly on Ortho-K lenses, because Paragon and Bausch + Lomb, which Valeant already owned, are the only holders of the FDA approvals required to manufacture the lenses.
The FTC also asked questions about whether Valeant used distribution contracts as leverage to persuade manufacturers to exclusively sell other Valeant contact lens products, the person said.
Valeant did not immediately respond to questions regarding this story.