U.S. government issues $1.1B in ventilator contracts to Philips, GM

By the third quarter of this year, Philips hopes to have achieved a four-fold increase in its ventilator production, following investments of “several tens of millions” of dollars in its U.S. manufacturing sites. (Getty images/sturti)

The U.S. federal government has tapped Philips to manufacture hospital ventilators for critical COVID-19 care, with the company planning to double its production by May—while the automaker General Motors has been contracted to deliver 30,000 by the end of August.

Under the Defense Production Act—which can require businesses to prioritize the filling of government orders—Philips plans to deliver 2,500 new ventilators to the country’s strategic stockpile by the end of next month, with a total of 43,000 by the end of the year, under a $646.7 million contract. 

At the same time, GM is slated to deliver 6,132 ventilators by June 1, as a part of its $489.4 million order. The car manufacturer has been collaborating with Ventec Life Systems to increase production.

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The U.S. Department of Health and Human Services said that five other, unnamed companies would receive similar supply contracts in the coming week, including for additional ventilators, to help support its response to the coronavirus pandemic.

“There is an unprecedented global demand for medical equipment to help diagnose and treat patients with COVID-19,” said Philips CEO Frans van Houten. “We welcome the support of the U.S. government in our efforts to aggressively increase the production of hospital ventilators.” 

By the third quarter of this year, Philips hopes to have achieved a four-fold increase in its ventilator production, following investments of “several tens of millions” of dollars in U.S. manufacturing sites, the company said. 

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The company said it may deliver the ventilators in batches and phases, in order to simultaneously supply multiple countries or regions. 

Philips also said that critical medical equipment such as this should be distributed in an ethical approach, with hardware being allocated based on independent COVID-19 tracking data for each area as well as their capacities to offer care. 

Over the past few months, the company said it delivered several thousand ventilators to U.S. hospitals, as well as a recent additional batch to a New York hospital following the production ramp-up.

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Meanwhile, the FDA recently gave medtech companies additional leeway in marketing their remote patient monitoring solutions to help address COVID-19. The ultimate goal is to help give hospitals the tools to get uninfected or low-risk patients out of the clinic to free up resources and slow the spread of the disease—and a separate policy applied to certain hospital staff in the same vein.

At the same time, the Centers for Medicare and Medicaid Services, which oversees certain laboratory regulations, issued a similar waiver in March allowing pathologists to perform certain diagnostic work remotely.

Philips took the government up on those offers earlier this month, opening up its IntelliSite program to allow pathologists to work from home, and view patient slides on their personal computer over a secure connection. 

"While the Philips IntelliSite Pathology Solution has been used over the past three years for remote work with a medical-grade monitor, we welcome the FDA exemption to allow consumer monitors to be used immediately by pathologists with our Solution," said Marlon Thompson, general manager of Philips Digital & Computational Pathology. "This enables more pathologists to work from home with the same confidence that they have in the office."

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