Congressional report accuses Trump administration of grossly overpaying ventilators during pandemic

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The staff report drawn up by an internal oversight subcommittee criticizes the administration for accepting the first offer from ventilator maker Philips Respironics in March 2020, accepting a higher price than any other U.S. buyer negotiating a contract with the company between mid-December 2019 and May 2020.

The report claims that the Trump administration could have overpaid $ 500 million, comparing its contract to the one negotiated by the Obama administration in 2014. The report cites “thousands of pages of previously non-public documents,” including emails between Philips and the administration. The White House and Philips reject the report’s findings.

The report says the company and the federal government agreed in 2014 to “develop and purchase” 10,000 ventilators for $ 3,280 each. After granting Philips several time extensions for the Obama-era contract, the Trump administration’s Department of Health and Human Services agreed to a new contract to purchase 43,000 units of a different fan model for $ 15,000 a piece, although other U.S. buyers have negotiated cheaper contracts with Philips, according to the report.

Panel staff wrote that “there is no indication” that ventilators purchased in 2020 provided “any advantage” over ventilators at the center of negotiations between Philips and the Obama administration.

Philips told subcommittee staff that under the contract with the Trump administration, it was not obligated to complete the delivery of the ventilators until September 2022, according to the report. He sent 200 ventilators to HHS in June, about six weeks after the panel’s probe officially started, the report said.Philips said on Friday that the 2014 contract was “primarily a research and development contract” in which HHS also requested fans at prices “considerably below commercial prices.” The company said the 2020 contract gives the US government a “discount” since the list price of ventilators chosen by HHS is over $ 21,000.

The Congressional report found that HHS paid more for Philips fans than more than 90 other buyers in the United States. The subcommittee asserted that the vast majority of US buyers were able to negotiate prices between $ 9,327 and $ 12,133 per unit compared to the US government’s agreed price of $ 15,000.

“The American people got ripped off and Donald Trump and his team were taken to the cleaners,” said Illinois Democratic Representative Raja Krishnamoorthi, chairman of the Economic and Consumer Policy Subcommittee, in a statement. communicated. “The Trump administration’s mismanagement of purchasing ventilators for the nation’s stock has taken a toll on the American people during the worst public health crisis of our generation. ”

But Judd Deere, a White House spokesman, called the report “partisan,” “misleading” and “inaccurate.”

“This partisan report is nothing more than a stunt that purely aims to politicize the coronavirus,” Deere wrote. “Because of the president’s leadership, the United States is the world leader in the production and procurement of ventilators. No American who needed a ventilator has been denied one, and no American who needs a ventilator in the future will be denied one. Shame on Democrats. of themselves for this misleading and inaccurate report. ”

The report also harshly criticizes Philips, accusing it of making a profit during a crisis. The head of the parent company of Philips Respironics strongly contested the findings of the report.

“We do not recognize the conclusions of the subcommittee report, and we believe that all the information we have provided has not been reflected in the report,” said Frans van Houten, CEO of Royal Philips, in a statement. . “I would like to point out that at no time has Philips increased its prices to take advantage of the crisis situation. ”

“Philips is proud to make its contribution to the fight against the pandemic through its acute care and diagnostic products,” he added.

CNN’s Nikki Carvajal and Scott Bronstein contributed to this report.

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