A decade into Frans van Houten’s tenure as CEO of Philips, the Dutch devicemaker faced one of its biggest challenges to date: a recall of around 5.5 million of its CPAP machines and other respiratory devices. The problem shaved millions off its potential earnings and led to legal orders from the FDA and a stream of class-action lawsuits.
After weathering that particular storm for about a year, van Houten is stepping back from the helm. Taking his place as chief executive will be Roy Jakobs, who’s been heading up Philips’ response to the recall for months.
If shareholders approve of the change at a Sept. 30 meeting, Jakobs will take on the dual role of president and CEO beginning Oct. 15. Its supervisory board and van Houten have already agreed to the move, the company said in a press release Tuesday.
Like his predecessor, Jakobs has been with Philips for over a decade. He joined in September 2010 as chief marketing and strategy officer for the lighting business then housed under the Philips umbrella. Over time, he took on executive roles within the company’s Middle Eastern unit and its domestic appliances and personal health segments.
Jakobs took on his current position—as chief business leader of the connected care division—in February 2020. As part of that role, he’s led the charge in resolving the respiratory device recall, overseeing the ongoing repair-and-replace program for all affected machines and working with the FDA and other authorities throughout the process.
As chief executive, the recall will remain top of mind for Jakobs, according to Tuesday’s release, which cited the conclusion of the recall action as a key priority for his new job. He’ll also be tasked with leading Philips’ recovery from the recall. The company recently suggested that its respiratory device sales won’t return to their pre-recall, pre-pandemic levels until 2025, with ongoing supply chain shortages compounding the recall situation.
“I aim to build on the company’s strong foundation as a purpose-driven health technology leader with deep innovation and clinical expertise to serve the needs of patients and consumers today and in the future,” Jakobs said in the press release, in which he also thanked van Houten for his trust and “great support.”
Meanwhile, van Houten, who stepped into the chief executive role in April 2011, will stay on as an adviser to Philips until the end of April 2023, ensuring the CEO swap is a smooth transition.
“While I am proud of our many accomplishments, much remains to be done to enhance the resilience of Philips to manage through current setbacks and adverse market conditions,” he said. “I gladly hand over to my executive committee team member Roy Jakobs in the knowledge that he brings the experience, energy and commitment to take Philips on the path forward, with continuity for our customers and determination to improve the health and well-being of billions of people in a sustainable and responsible way.”
By Andrea Park
Source: fiercebiotech.com
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