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Complaints of faulty Philips' devices mount as CEO departs

August 17, 2022

The US public health watchdog FDA said it had received nearly 50,000 reports against Philips in just three months. The Dutch giant has already had to recall millions of its devices.

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The recall was just the latest problem for the beleaguered company, which is losing market share to competitors like Siemens and General ElectricImage: LEX VAN LIESHOUT/AFP/Getty Images

The US Food and Drug Administration (FDA) said on Wednesday that reports of faulty products continued to mount against Philips, the Dutch medical tech giant.

The news came just a day after the company announced that its longtime CEO Frans von Houten would step down in October.

Philips has been hit with accusations of faulty ventilators and sleep apnea machines over the past quarter, prompting a recall of 5.5 million devices in the United States. The problem, caused by a foam part both machines contain, deeply damaged the company's reputation and helped wipe $30 billion (€29.4 billion) off its market capitalization.

"A wide range of injuries have been reported in these (reports) including cancer, pneumonia, asthma, other respiratory problems, infection, headache, cough, difficulty breathing, dizziness, nodules, and chest pain," the FDA said, noting that the reports do not confirm that Philips is responsible.

The FDA said it has received at least 48,000 complaints of the part breaking down or partially breaking down in the three month period ending on July 31, more than double the number it received over the year period from April 2021 to April 2022.

Stock price tumbles

A spokesperson for Philips said that the timing of the FDA's announcement and the company's statement that longtime CEO Frans von Houten was about to step down was coincidental.

Van Houten will be replaced by Roy Jakobs, the Philips executive who is heading the company's recall of respiratory sleep equipment, in October.

Spokesman Steve Klink said the increase in reports was due to increased public awareness of the problem after its recall began in June 2021.

"Over the past three months we were still going through what you would call a backlog of the complaints," he said. "Now we need to work through them and see which are justified and which not."

In March, the FDA had to order Philips to notify patients and doctors of the recall after calling its communication "inadequate."

Philips shares were down 1.1% on Wednesday, having lost 60% of their value since April 2021.

es/dj (Reuters, dpa)