The latest data from our Third Edition Recall Index, the leading recall insights report, confirms recall activity has remained steady, for the most part, for the last 10 months despite the COVID-19 pandemic. However, with cases surging and a turbulent holiday season fast approaching, product safety challenges are on track to be even more difficult to manage as 2020 ends. As we close out the year and enter into arguably some of the most challenging months we’ve ever seen, it’s crucial for companies to stay abreast of the latest recall data and trends. We’ve summarized our latest findings below.
Third Edition Recall Index – Findings By Industry:
As federal agencies and drug makers have adapted to the new regulatory and business environment, recall activity in the pharmaceutical industry returned to pre-COVID-19 levels in the third quarter. In fact, recall activity jumped 49.3% to 100 events, hitting the 100+ recall milestone for the first time since the fourth quarter of 2018. The heightened level of recalls this quarter tells us it’s even more likely the drug industry will reach the same volume of recalls we saw in 2019 before the pandemic occurred.
The Consumer Product Safety Commission (CPSC) announced an average of five consumer product recalls each week and a total of 71 recalls in the third quarter. In October alone, there were 17 recalls. If recalls maintain this pace, they will surpass last year’s total of 240 events. But there’s much more going on in the industry beyond recalls. From the growing uncertainty in the direction and leadership of the CPSC and the controversy around the COVID-19 product guidance to the increasing scrutiny of infant and children’s products, a surge in recall activity is likely.
Medical device recalls fell to a six-quarter low with just 242 events in the third quarter. Despite this drop, the quarterly average for 2020 remains higher than 2019 and regulatory attention remains prevalent as the industry works to meet the increasing demand for products such as ventilators, face masks and other PPE. But when it comes to long-term, post COVID-19 issues, we’re seeing the spotlight focus on how regulators and companies collectively manage constant safety concerns as medical publications and organizations continue to publish evaluations of regulatory frameworks and communications best practices.
Food and Beverage
Food and Drug Administration food recall activity began returning to normal levels in the third quarter with 106 recalls, a 34.2% increase in events compared to last quarter. Of these recalls, 35.8% were health and life-threatening Class I events, impacting a whopping 63.4% of all units. Meanwhile, the United States Department of Agriculture (USDA) recalls remained steady with record low levels over the last three quarters. But these lower numbers aren’t a representation of the challenges facing the food industry. In fact, class-action legal complaints against food and beverage firms are expected to pass 2019’s total, according to HBW Insight.
Automotive recall activity decreased by 23.5% in the third quarter, dropping below 160 events for the first time since the first quarter of 2013. We saw 53 recalls in October. These recalls impacted an average of about 13,500 units compared with the third-quarter average of 34,000 units. While we’re seeing numbers drop, we expect a return to higher levels as we close out the year and we head into 2021. With the recent safety concerns related to batteries in electric vehicles, seat belts, and airbags, automakers surely have their work cut out for them.
In reality, no matter your industry, recalls are only a fraction of the in-market remediation activities you deal with every day. As the regulatory landscape evolves, customer expectations grow, and plaintiffs’ attorneys seek vulnerable targets, you must adapt to protect your reputation and your ability to grow your business.