Ref. Ares(2020)3207536 - 19/06/2020
Press release
March 22, 2020
Philips ramps up production of critical health
technology products in response to COVID-19
pandemic
Read more ›
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 Klink
Philips Global Press Office
Tel.: +31 6 10888824
E-mail:
xxxxx.xxxxx@xxxxxxx.xxx
Leandro Mazzoni
Philips Investor Relations
Tel.: +31 20 59 77222
E-mail:
xxxxxxx.xxxxxxx@xxxxxxx.xxx
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About Royal Philips Royal 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 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
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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