Philips halts production of ventilators as HHS looks into contract

A contract for Murrysville based Philips Respironics to make hospital ventilators has been cut short amid a government probe.

Philips said Monday that the U.S. Department of Health and Human Services told the company to stop making ventilators for the Strategic National Stockpile, which it had been contracted to do in April. The company had delivered just 12,300 of the 43,000 ventilators it was asked to produce by December for the nation’s emergency medical supply warehouse.

A Health and Human Services spokeswoman said the department suspended the contract because it was “subject to an internal HHS investigation and legal review.” She declined to elaborate.

Philips was among the companies the government contracted to make more than 187,000 ventilators by the end of the year. Better known locally for its line of sleepmedicine products, the company began ramping up ventilator production when the COVID- 19 outbreak emerged in China in January.

Philips has 8,000 employees in

China.

The company had planned to crank up production by 4,000 ventilators per week by the end of the third quarter to meet rising demand, a spokesman said in March. Philips Sleep and Respiratory Care, which includes the ventilator assembly and testing operation, has nearly 2,000 employees in five Western Pennsylvania locations that include manufacturing, distribution and service centers.

A company spokeswoman did not say whether the contract ending would affect employment locally. Workers in Murrysville, and at a second facility in Carlsbad, Calif, had been in charge of the ventilators’ final assembly and testing.

In a statement, CEO Frans van Houten said he was proud of the way the company met COVID- 19’ s challenges.

“I am proud that with great urgency and under intense pressure we achieved a fourfold ventilator production expansion with

substantial investments: We hired hundreds of new colleagues for our factories in the U. S. and called upon our supply- chain partners to massively step up, all in response to the COVID- 19 pandemic,” he said. “To date, we have delivered on our commitments to HHS.”

Moreover, Mr. van Houten said Philips Respironics was “committed to work with the government and several of its agencies to support health care providers with the diagnosis, treatment, monitoring and management of COVID19 patients as well as the provision of regular health care.”

Doctors use mechanical ventilators for people who are severely ill and have trouble breathing because of COVID- 19, which attacks the lungs.

As of Monday, the highly contagious virus had claimed the lives of 183,400 people in the U.S. The average daily number of COVID- 19 patients on a ventilator in Pennsylvania was 81, a decline from a daily average of 90.8 patients on a ventilator a week ago, according to the state health department.