Philips Reaches $1.1 Billion Settlement for Recalled CPAP and Ventilator Machines

In a significant development, medical device maker Philips has agreed to a $1.1 billion settlement to resolve claims from consumers who allege they were injured by the company’s recalled CPAP sleep apnea machines and ventilators. The settlement comes after millions of Philips devices were found to have a potentially dangerous defect, prompting a massive recall in 2021 and numerous consumer lawsuits.

5 Key Points:

  •  Philips has reached a $1.1 billion settlement to resolve personal injury claims related to its recalled CPAP and ventilator machines.
  • The recall affects around 15 million Philips devices worldwide, sold between 2008 and 2021 under the Philips Respironics brand.
  • The FDA has received over 116,000 reports, including 561 death reports, potentially related to the foam issue in the devices.
  • The settlement includes $25 million for medical monitoring and is expected to be finalized in 2025.
  • A separate $613.3 million settlement was reached last week to address economic damages from the recall.

The Recall and Its Impact

The Philips CPAP and ventilator recall, classified as a Class I recall by the Food and Drug Administration (FDA), affects approximately 15 million devices worldwide. The recalled machines were sold in the United States between 2008 and 2021 under the Philips Respironics brand. The FDA has received more than 116,000 Medical Device Reports (MDRs), including 561 reports of death, that were either reported or suspected to be related to the foam issue in the Philips devices.

Settlement Details

The $1.1 billion settlement, which includes $25 million for medical monitoring, was mediated by retired magistrate judge Diane M. Welsh. The agreement must still be filed with a federal court in Pennsylvania, the primary state where the machines were produced. Philips announced the settlement on Monday, along with its first-quarter financial results, causing its stock price to surge. The company expects to make the settlement payments in 2025.

This settlement is separate from a $613.3 million class-action lawsuit settlement reached last week, which addresses economic damages from the recall. The economic loss settlement, approved by senior U.S. district judge Joy Flowers Conti, offers reimbursement to users and insurance companies for recalled machines they had bought or leased.

What Consumers Should Do

Under the financial-loss settlement, users can claim a $100 award if they return their recalled device by August 9, 2024. Those who suspect they own or use an affected device should verify their machine’s status using Philips’ recall page, which offers ways to check serial numbers and register a product.

A dedicated website accepts claims for the financial-loss settlement, and users may be eligible for additional payments for each recalled device they purchased, leased, or rented. If users paid out of pocket to replace a recalled machine, they could be entitled to a device replacement award.

The Defect and Its Risks

Thousands of health complaints from CPAP users triggered the recall. Investigations found that a polyester-based polyurethane foam built into the devices to dampen sound and vibration had a risk of breaking down, mainly when used in warm and humid conditions. If the foam breaks down, users could inhale or swallow black pieces of foam or certain chemicals, potentially resulting in toxic and carcinogenic effects and other significant harms.

Current Status of Philips CPAP Machines

U.S. sales of Philips’ popular DreamStation and other respiratory units are on hold, pending the company’s satisfaction with the terms of a consent decree with the U.S. government. Philips plans to resume selling the devices once these terms are met and will continue to service units still in use, including providing replacement parts.

About Sleep Apnea and CPAP Machines

Sleep apnea is a disorder that prevents people from getting enough oxygen while sleeping, often characterized by long pauses in breathing and loud snoring. Continuous positive airway pressure (CPAP) machines help keep airways open and maintain sleep. The average cost of a CPAP machine is around $800, with prices ranging from $500 to over $1,300. The recall also covers some models of Philips’ more advanced BiPAP ventilators, which facilitate inhalation and exhalation.