AMSTERDAM—Philips will pay $1.1 billion to settle the personal injury litigation and the medical monitoring class action lawsuit to end the uncertainty associated with litigation in the U.S. This settlement was announced on April 29 along with Philips' first quarter results and comes months after Philips Respironics announced the discontinuation of 19 sleep and respiratory products in the United States.
With this settlement, Philips and Philips Respironics do not admit any fault or liability, or that any injuries were caused by Respironics’ devices.
The settlement addresses the claims filed in the U.S. courts and potential claims submitted to the census registry. Under the settlement, Philips Respironics has agreed to pay a total of $1.1 billion USD. The related payments are expected in 2025 and will be funded from Philips’ cash flow generation. As a consequence, a EUR 982 million* provision was recognized in Q1 2024.
In April 2024, Philips Respironics signed a consent decree, which was court-approved, and obtained the final court approval for the previously announced economic loss settlement in the U.S., for which a provision was recognized in Q1 2023.
Philips also concluded an agreement with insurers to pay Philips EUR 540 million to cover Respironics recall-related product liability claims. This income is expected to be recognized in Q2 2024 and payment is expected during 2024.
Per the settlement, regardless of whether eligible individuals have filed a case, joined the census registry, or done nothing at all, they will have six months from the date of the settlement to sign up for the settlement.
For more information on the Respironics litigation, visit here.
*After converting the USD $1.1 billion amount to euro and discounting for time.
