The Dutch technology company Philips will temporarily stop selling sleep apnea devices in the United States. This is evident from one quarterly report that the company published on Monday. Philips has reached a settlement with the FDA, and wrote off 363 million euros in the last quarter of last year.
A US judge must still approve the settlement. Philips will continue to service apnea devices in the US and sell parts of those devices, but will no longer sell new devices “until the relevant terms of the settlement are met.” It is not clear when exactly that will be. Outside the US, sales of new devices continue.
People with sleep apnea suffer from shortness of breath at night. The Philips device helps them to breathe regularly during their sleep, but pieces of sound-absorbing foam appeared to crumble, causing health problems. The problems have already prompted a recall of more than a billion dollars and a criminal investigation in the US.
In its first settlement with affected customers in the US, Philips already allocated 479 million dollars (then 448 million euros) to compensate them. This time it is a so-called consent decreean agreement with the FDA on steps the company must take to return to compliance.
‘Discomfort and concern’
From research by NRC it emerged in September that Philips had kept quiet over 3,700 reports about the devices for years since 2010 and had not investigated at least ten deaths. One of the lawyers leading a class action lawsuit against Philips said every user “has been deceived from the moment of purchase.”
Philips CEO Roy Jakobs apologized in a statement on Monday for “the inconvenience and concern” caused by the sleep apnea affair. “We are fully committed to complying with the settlement, which provides a clear path forward.”
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Correction: An earlier version of this post stated that the previous settlement was also with the FDA. That was with affected customers. This has been adjusted above and the distinction has been clarified.