Sam Brusco, Associate Editor09.08.23
Philips said on Thursday that it and its Philips Respironics subsidiary reached an agreement to resolve economic loss claims in the U.S. Multidistrict Litigation (MDL) related to Philips Respironics’ voluntary recall of some of its sleep and respiratory care devices.
The settlement doesn’t include admission of liability, wrongdoing, or fault by Philips. The settlement will also compensate some people who obtained devices after the recall.
The company will make an initial payment of $479 million, and said predefined cash awards will be given to all eligible U.S. participants—depending on the device type, extended warranties on replacement devices, and a further cash award if the recalled device is returned. Payments aren’t anticipated to begin until Q1 2024 at the earliest, subject to final approval by the court.
The company also said the settlement’s final cost may vary based on how many patients participate, as well as what the court awards for professional fees associated with the resolutions. The company recorded a provision for €575 million ($615.8 million) in Q1 2023 to fund the final settlement’s estimated costs.
"The final costs may vary based on how many patients participate but at the end of the day we believe the 570 million euros will cover the costs of the final settlement," Philips spokesman Steve Klink told Reuters.
Recalled devices subject to compensation include the following CPAP, BiPAP, ventilator, and/or other devices sold, leased, rented or otherwise distributed in the U.S.:
Philips also noted this agreement doesn’t settle any claims of personal injury or medical monitoring claims in the litigation, and that Philips parties have moved to dismiss those claims. The company continues to face further litigation over the claims as well as a U.S. Department of Justice investigation. According to Reuters, the company is in discussion with the U.S. Food and Drug Administration (FDA) over a “consent decree” (settlement).
In June 2021, Philips Respironics began this voluntary recall because the PE-PUR foam used to stifle noise from the affected CPAPs, BiPAPs, and mechanical ventilators could degrade and become toxic, with potential carcinogenic risks.
The settlement doesn’t include admission of liability, wrongdoing, or fault by Philips. The settlement will also compensate some people who obtained devices after the recall.
The company will make an initial payment of $479 million, and said predefined cash awards will be given to all eligible U.S. participants—depending on the device type, extended warranties on replacement devices, and a further cash award if the recalled device is returned. Payments aren’t anticipated to begin until Q1 2024 at the earliest, subject to final approval by the court.
The company also said the settlement’s final cost may vary based on how many patients participate, as well as what the court awards for professional fees associated with the resolutions. The company recorded a provision for €575 million ($615.8 million) in Q1 2023 to fund the final settlement’s estimated costs.
"The final costs may vary based on how many patients participate but at the end of the day we believe the 570 million euros will cover the costs of the final settlement," Philips spokesman Steve Klink told Reuters.
Recalled devices subject to compensation include the following CPAP, BiPAP, ventilator, and/or other devices sold, leased, rented or otherwise distributed in the U.S.:
- C-series S/T, AVAPS (C-series and C-series HT);
- DreamStation ASV;
- DreamStation BiPAP;
- DreamStation CPAP;
- DreamStation Go;
- DreamStation ST, AVAPS;
- E30;
- OmniLab Advanced Plus;
- System One 50 Series ASV4 (Auto SV4);
- System One 50 Series Base;
- System One 50 Series BiPAP;
- System One 60 Series ASV4 (Auto SV4);
- System One 60 Series Base;
- System One 60 Series BiPAP;
- Trilogy 100/200, Garbin Plus, Aeris LiveVent; and
- V30 auto
Philips also noted this agreement doesn’t settle any claims of personal injury or medical monitoring claims in the litigation, and that Philips parties have moved to dismiss those claims. The company continues to face further litigation over the claims as well as a U.S. Department of Justice investigation. According to Reuters, the company is in discussion with the U.S. Food and Drug Administration (FDA) over a “consent decree” (settlement).
In June 2021, Philips Respironics began this voluntary recall because the PE-PUR foam used to stifle noise from the affected CPAPs, BiPAPs, and mechanical ventilators could degrade and become toxic, with potential carcinogenic risks.