Philips ramps up production of critical health technology products in response to COVID-19 pandemic
March 22 2020 - 3:30PM
Philips ramps up production of critical health technology products
in response to COVID-19 pandemic
March 22, 2020
Amsterdam, the Netherlands – Royal Philips
(NYSE: PHG, AEX: PHIA), a global leader in health technology, today
announced that it is increasing the production of certain critical
care products and solutions to help diagnose and treat patients
with the new coronavirus disease (COVID-19).
The most needed products are patient vital signs monitors and
portable ventilators and medical consumables for non-invasive and
invasive ventilation to treat a broad range of respiratory
conditions. Other Philips products and solutions to help address
the preparedness, response and recovery needs of COVID-19 include a
range of diagnostic imaging systems (CT, mobile diagnostic X-ray,
and ultrasound) to help diagnose and assess respiratory conditions,
as well as hospital telehealth solutions to centrally monitor and
manage patients in the intensive care unit (Philips eICU program),
and telehealth solutions to connect caregivers and patients at
home.
For example, Philips is ramping up the production of hospital
ventilators and plans to double production within the next eight
weeks and achieve a four-fold increase by the third quarter of
2020. The company is mobilizing its global supplier network to step
up support and production in this extraordinary situation. Philips
has a global manufacturing footprint with final assembly sites in
North America, Europe and Asia, and, equally important, a global
network of certified materials and component suppliers.
In line with the recent call to action by the International
Chamber of Commerce (ICC) and World Health Organization (WHO),
Philips is also calling on governments to facilitate enhanced
access to critical materials and components by not imposing
restrictions such as export controls and tariffs, and to provide
help to accelerate logistics, as well as exemptions for critical
suppliers from lockdown measures.
Philips believes that critical medical equipment, such as
hospital ventilators and patient monitors, should be made available
across the world, prioritizing those communities and countries that
need it the most, using a fair and ethical approach to allocate
supply to acute patient demands based on data such as the COVID-19
risk-classification of a country/region.
“In line with Philips’ mission to improve people’s lives, we
want to help as many healthcare providers as possible to deal with
the growing numbers of critical COVID-19 patients”, said Frans van
Houten, CEO of Royal Philips. “There is an unprecedented global
demand for medical equipment to help diagnose and treat patients
with COVID-19. We are working around the clock to double our
hospital ventilator production within the next eight weeks and we
are aiming for a four-fold increase by the third quarter.”
“We are actively engaging with the medical technology industry,
governments, the World Health Organization and other health
authorities to safeguard the production expansion of materials,
components and final products, as well as their shipment between
countries. We are calling on all these parties to help us in our
endeavor to save lives by accelerating deliveries. We believe in
fair allocation of scarce medical equipment to those that need it
the most, while we are ramping up to supply other regions in the
coming months,” continued Frans van Houten.
Philips’ efforts to increase the production include:
- Hiring additional manufacturing employees and shifting current
employees to support increased demand immediately;
- Adding manufacturing lines and increasing the number of shifts
to 24/7 shifts;
- Working closely with Philips’ suppliers to secure materials
supply to feed the increased production at our manufacturing
sites;
- Leveraging Philips’ innovation capabilities to re-purpose
adjacent product ranges to address the increased demand;
- Engaging with third party contract manufacturers.
COVID-19 impact on Philips’ performance Despite
the COVID-19 pandemic, Philips has been able to continue its global
business operations and serve its customers. However, the impact of
the outbreak on public life and industry in the most affected
regions is resulting in a decreased demand for Philips’ consumer
portfolio and is affecting Philips’ global supply chains. While
this is expected to have a negative impact on the financial
performance of Philips in the first half of 2020, the company
cannot quantify the magnitude and duration of such impact at this
time given the continued fluidity of the situation. Philips
continues to monitor and assess its business operations daily, and
will provide an update as appropriate.
For further information, please contact:
Steve KlinkPhilips Global Press OfficeTel.: +31 6
10888824E-mail: steve.klink@philips.com
Leandro MazzoniPhilips Investor RelationsTel.: +31 20 59
77222E-mail: leandro.mazzoni@philips.com
About Royal PhilipsRoyal Philips (NYSE: PHG,
AEX: PHIA) is a leading health technology company focused on
improving people's health and enabling better outcomes across the
health continuum from healthy living and prevention, to diagnosis,
treatment and home care. Philips leverages advanced technology and
deep clinical and consumer insights to deliver integrated
solutions. Headquartered in the Netherlands, the company is a
leader in diagnostic imaging, image-guided therapy, patient
monitoring and health informatics, as well as in consumer health
and home care. Philips' health technology portfolio generated 2019
sales of EUR 19.5 billion and employs approximately 80,000
employees with sales and services in more than 100 countries. News
about Philips can be found at
http://www.philips.com/newscenter.
Forward-looking statements This release
contains certain forward-looking statements with respect to the
financial condition, results of operations and business of Philips
and certain of the plans and objectives of Philips with respect to
these items. Examples of forward-looking statements include
statements made about the strategy, estimates of sales growth,
future EBITA, future developments in Philips’ organic business and
the completion of acquisitions and divestments. By their nature,
these statements involve risk and uncertainty because they relate
to future events and circumstances and there are many factors that
could cause actual results and developments to differ materially
from those expressed or implied by these statements.
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