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Philips: ‘We will regain our market position’

Philips: ‘We will regain our market position’

Frans van HoutenAMSTERDAM – Philips hosted a one-and-a-half-hour conference call on July 26 to discuss its recent financial results and all but a few questions concerned the company’s voluntary recall of certain CPAP devices and ventilators. Here are comments from CEO Frans van Houten on everything from the company’s ability to rebound to its response to civil lawsuits. 

No monopolies 

On the feedback Philips has received from providers and physicians on the recall: “What we hear is that nobody has the appetite for a monopolistic market situation, and they expect Philips to be able to quickly recover its position in the market and resume, let’s say, our strong preference,” he said. “What doctors point to is the strong analytical capacity of our systems, helping them to understand the trend line of patients. So, we are under the conviction that we will regain our market position, or at least close to, pretty fast after we are able to resume production for commercial purposes.” 

On defense 

On the civil complaints and personal injury claims that have been filed against Philips in court: “It is far too early to draw any conclusion to talk about the merits of the claims or speculate about Philips’ exposure,” he said. “In due course, we will be able to assess the merits of any claim, and we intend to defend our position vigorously, supported by the further test data that we are gathering. Obviously, the timelines that may apply to the handling of claims in not yet clear.” 

‘Significant’ contributor 

On the potential role of ozone cleaners in exacerbating the degradation of sound-abatement foam: “We have tested that, and we see a 40 times factor of acceleration of degradation when ozone is being used,” he said. “That’s on an average use of ozone cleaning. If people do that every day, of course, it does even faster, right? But the acceleration factor caused by ozone cleaning is very, very significant. And, otherwise, we would not call it out. It’s a very aggressive cleaning method that should not be used on medical devices at all.” 

‘It takes time’ 

On the projected eight-week timeframe for hearing back from the U.S. Food and Drug Administration on the company’s proposed replacement material: “The FDA has asked us to provide data that the replacement material is safe and sound," he said. “I mean, if you boil it all down, everybody wants to assure that if you go out with a repair-and-replace action on a couple of million devices that you do that in the full knowledge that it is a good solution. So, I think it is diligent and the only unfortunate thing is it takes time. And patients are, you know, wanting to get this dealt with as soon as possible because not using the therapies is also giving a lot of discomfort and harm.”


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