By Chris Harvey, VP, crisis solution
While regulators and business leaders enter the third calendar year of COVID-19, some new challenges are emerging atop the lingering supply chain and service issues brought on by the pandemic.
The Biden administration continues to push for more consumer safeguards as medical device recalls rise and regulators consider stricter rules for traceability of tainted food products. As reported in the latest edition of our 2022 Recall Index report, it’s a crucial time for companies at every level in the supply chain to be aware of regulatory changes and the threats to their businesses and reputations posed by recalls and other in-market product incidents.
This latest report offers a year-in-review analysis of 2021 recall activity and predictions for 2022. We also feature insights from some of our strategic partners at leading law firms to help you prepare for the increased risks created by product innovations and changes in the regulation of automobiles, food and drink, drugs, medical devices, and consumer products.
Advancements in vehicle technology leads to safety and regulatory challenges for automotive industry
With an increase in recall activity for the eighth straight quarter, 2021 ended up surpassing 2020 for the total number of automotive recalls. The industry saw 770 recalls in 2021, compared to 739 for all of 2020. And as recalls rise, advancements in vehicle technology continue to create more safety and regulatory challenges, which automakers must monitor and adapt to. Data privacy concerns around “connected” vehicles, the safety of new technology, and the newest crash-safety features rolling out on autonomous and electric vehicles must all be considered.
Increased oversight and enforcement continue for the consumer product industry
Some experts predict that the Consumer Product Safety Commission’s (CPSC) request for an increase in budget will inevitably lead to more recalls. With only 218 recalls in 2021, the industry saw its lowest level of such activity in more than fifteen years. But even as recalls decline, the agency’s newfound bare-knuckle approach to oversight and enforcement is full speed ahead. With its new chairman, there is no sign of the commission pulling back on the aggressive stance it’s taken on compliance and enforcement.
Consumer product companies need to be thinking about their recall and corrective action plans from end-to-end, as well as closely reviewing processes and procedures for everything from compliance with reporting requirements, recall implementation, and crisis communications.
Food industry to expect significant changes to reporting and tracing regulations in 2022
Food recalls have been declining steadily for the past five years, and with site inspections halved in 2021, total recorded events fell to their lowest level in 11 years (414). But all signs indicate that food regulation will tighten in 2022. Several new proposals, including the Food and Drug Administration’s (FDA) Foodborne Outbreak Response Improvement Plan, were rolled out in 2021. The plan makes it clear that manufacturers will see significant changes in reporting and tracing regulations in 2022 and beyond. How these regulations will change is still unclear, but businesses should review the guidelines and start planning for how their operations and reporting structures will adapt.
The pandemic continues to affect the medical device industry
In 2021, the medical device industry saw the highest number of units recalled in the past 10 years (602.5 million). It’s clear we can’t declare victory yet over the COVID-19 pandemic, and so the FDA is starting to think about what happens next for medical devices granted Emergency Use Authorizations (EUAs), or which fell within special public health emergency enforcement.
Another change the pandemic brought to the medical device sector was 3D printing at the point-of-care (PoC). The FDA is gathering input on how to regulate this and where the responsibility and liability resides for production conducted outside a manufacturing facility. Companies will have to think carefully about whether the value of having a large quantity of products made quickly at the PoC outweighs potential legal liabilities.
Emergency Use Authorizations (EUAs) are changing the pharmaceutical industry
The dramatic rise in the use of EUAs has changed the pharmaceutical industry. The FDA is expected to continue to grant EUAs in an effort to contain the pandemic. And as companies seek these special authorizations, they should ensure not to rush anything on compliance and recall preparedness. The industry should also be planning for post-pandemic life and how to navigate the transition from EUAs to normal regulatory approvals. As for the numbers, the industry saw a five-year low for the number of recall events with a total of 274 in 2021. At the same time, the industry hit the second-highest number of units involved in recalls in the past ten years.
We can expect that 2022 will bring even more aggressive enforcement action across all the key agencies. While we remain hopeful that the global health crisis will finally be contained, we know that many of the challenges presented will remain. Companies across all industries would be wise to closely re-evaluate all manufacturing processes, scrutinize supply chain partners, and invest time and resources to prepare recall management, crisis and communications plans.
Companies should also seek out expert partners for their experience and abilities. Doing so can save millions of dollars in regulatory and litigation costs, and help you honor your commitments to customers, supply chain partners and regulators while protecting your reputation among the stakeholders that matter most.
Get more recall data, trends and predictions, along with additional insights and commentary from some of our strategic partners in the latest edition of our Recall Index report – available for download here.