Recalls Remain Steady as Regulators are in the Hot Seat

The big story from the Q2 2019 Recall Index we’ve just released isn’t as much about the number of events or units recalled as it is the recall environment companies are finding themselves in.

While Congress focuses on safety-related regulatory processes at the CPSC, and FDA tries to find its way on matters related to cannabis and CBD oil, companies are finding a regulator that is stricter and more sensitive to pressure from lawmakers.

With an increasing number of risks and safety issues demanding attention from short-staffed, budget-strained regulators, inspections have been lagging and recalls haven’t climbed dramatically in recent months. But here’s our warning: don’t expect that to continue. Even if it does for a little while longer, make sure you proactively address issues and plan for any safety challenges so you don’t become the next poster child.

After all, Congress may ultimately give CPSC more teeth by repealing Section 6(b), which has allowed companies to discreetly manage many product-safety issues. The agency may also try to save face in light of criticism of its handling of recent infant products and in-home elevator risks, taking severe action against any of these companies. Or it could come down hard on one of the next big issues, like rubber infill used at playgrounds and athletic fields.

Meanwhile, FDA continues to take action against CBD companies despite the lack of final regulations guiding the category. The agency is also sending warning letters to API repackers that could have a trickle-down effect to the pharmaceutical companies using those ingredients.

Here are a few highlights from the latest Index:

• CONSUMER PRODUCTS: There were 36 fatalities due to consumer product recalls reported in Q2 2019, 7 more than the previous high since at least 1997. Incidents blamed on consumer product recalls increased 457% from Q1 2019 to 919 – lower than 4 of the last 6 quarters. Injuries also increased 458.8% to 95 – higher than 5 of the last 6 quarters.
• DRUGS: cGMP deviation was the top reason for pharmaceutical recalls for the first time since at least Q1 2016. cGMP deviation was also the top reason for pharmaceutical recalled units fourth time in the last five quarters.
• MEDICAL DEVICES: Software issues were the top cause of medical device recalls, accounting for 46 recalls.
• FOOD: For the eighth consecutive quarter, undeclared allergens was the top cause of FDA food recalls at 48.4%. Foreign material was the top cause for FDA recalled units.  Meanwhile, USDA recalls decreased 17.9% to 32 but still remained higher than 5 of the last 7 quarters. 28.1% of USDA recalls were due to no inspection.
• AUTOMOTIVE: Despite the headlines, auto recalls remain flat over the last two years. But we do continue to see the long tail of OEM recalls with airbags again accounting for 18 recalls.

While recall numbers haven’t been rising drastically, we know companies are increasingly concerned about new regulatory enforcement. Rightfully so, what it really comes down to is each company’s ability to live its commitment to safety in every consumer interaction. After all, consumers care little about regulatory definitions and nuance. What they care about is the safety of their families and friends. We must always remember that.