HHS ends vent contracts with Philips, Vyaire, Hamilton

News follows OIG’s announcement that it would audit the contracts
Wednesday, September 2, 2020

AMSTERDAM – Royal Philips announced Monday that it has received notice from the U.S. Department of Health and Human Services that its contract to deliver 43,000 bundled EV300 ventilator configurations through December 2020 has been partially terminated. 

Philips delivered 12,300 bundled vent configurations to the Strategic National Stockpile by the end of August, but it will no longer supply the remaining 30,700 Philips EV300 vents. 

“To date, we have delivered on our commitments to HHS,” said Frans van Houten, CEO of Royal Philips. “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 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. While we are disappointed in light of these vast efforts, we will adjust our plans and work with HHS to effectuate the partial termination of this contract.” 

HHS has also cancelled orders for vents with Vyaire Medical and Hamilton Medical, according to Bloomberg. A spokesperson with the U.S. Department of Health and Human Services told the news agency that Vyaire will deliver only 4,000 of 22,000 contracted vents and Hamilton Medical will deliver only 4,518 of 25,574. 

The Office of Inspector General announced in July that it would be auditing HHS’s vent contracts under the Defense Production Act.