The recall of Philips automatic respirators: a case about which the public is poorly informed and which risks wiping out the Dutch multinational
The Dutch multinational Philips, once involved in electronics and now diversified into multiple sectors, including the medical one, is facing a big problem: the FDA in August issued a recall order for tens of thousands of the company's automatic respirators Dutch for problems related to the pulverization of insulation foams. Their disintegration entails the risk of pathologies such as tumors, hence the need for mass recall.
This happens in a country where recalls and responsibility towards the consumer is taken quite seriously, so Bayer was forced to pay 12 billion dollars in compensation because Monsanto's Roundup herbicide was found to cause cancer. And Roundup was not medical material, nor had it been subjected to repeated investigations and recalls, which then also affected related brands. J&J was ordered to pay 4.6 billion dollars in 2018 because US baby powder could contain asbestos and was not even a medical material. What could be the damage for Philips?
5.5 million CPAPs and other respiratory devices were recalled, and deaths were reported, all from 2021 through 2023.
In mid-2021 Philips initiated a recall involving millions of CPAP and BiPAP ventilators and other respiratory devices. The devices, used for sleep apnea therapy and more, were equipped with sound-reducing foam that could potentially degrade and penetrate the airways.
Nearly two years later, Philips Respironics is still effectively out of the respiratory market as it works to repair the devices. Since April 2021, the FDA has received 105,000 reports of issues, including 385 reports of deaths associated with the foam degradation issue.
Roy Jakobs, chief executive of Philips, said the Dutch medical technology giant deeply regretted the withdrawal. Let's say that this is a fair euphemism, because this affair has cost human lives and risks costing the Dutch giant a lot of money.
Philips is still in the midst of consent decree negotiations with the US Department of Justice and the FDA. Therefore all resulting damages, definitively, have yet to be quantified. Meanwhile, the FDA has taken control of the recall process.
In Italy the recall should have been completed by April 2023, but there doesn't seem to have been all this urgency.
The Dutch company has currently set aside over 700 million for the matter.
However, this figure risks being optimistic, given the precedents in the USA, hoping that no one else will take action from a judicial point of view to obtain reimbursement of damages.
Curiously, Exor of the Agnelli family entered the game on the very day the FDA identified the recall of Philips respiratory products as extremely serious, taking a controlling stake in the company. A very curious timing, but the deal risks becoming dangerous, given the extent of the damage at stake.
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The article The recall of Philips automatic respirators: a case about which the public is poorly informed and which risks wiping out the Dutch multinational comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/il-richiamo-dei-respiratori-automatici-philips-un-caso-di-cui-il-pubblico-e-poco-informato-e-che-rischia-di-spazzare-via-la-multinazionale-olandese/ on Fri, 08 Sep 2023 14:26:10 +0000.