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Koninklijke Philips (NYSE: PHG) notified its customers about a possible power malfunction in its Trilogy Evo continuous ventilators and initiated a software update to resolve the same in March. The FDA classified this action as Class I level recall, the most serious type of recall, as the use of these devices without the software update may cause serious injuries or death. This recall is a correction and not a product removal. It includes all susceptible devices — Trilogy EVO, Trilogy EV300, Trilogy Evo O2, and Trilogy Evo Universal.
The company also informed that these ventilators can issue a "Battery Depleted" or "Loss of Power" alarm while sufficient power is still available due to the software issue.
Price Performance For the past six months, PHG's shares have gained 29.5% compared with the industry's rise of 13.3%. The S&P 500 increased 16.2% in the same time frame.
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More on the Trilogy Ventilators The Trilogy ventilators use a microprocessor-controlled blower to provide pressure support, pressure control, or volume control during breathing support. These devices are designed to aid those who need help breathing, and they can offer ongoing or sporadic support. They can be used in non-emergency, home, and medical transport environments, such as an ambulance, wheelchair, or personal automobile.
Reasons for Recall Philips Respironics, a subsidiary of Koninklijke Philips, notified customers to update to the latest software version of its Trilogy Evo continuous ventilator devices due to a possible power malfunction. The Trilogy Evo ventilators' software malfunction can result in a sudden loss of ventilation while the device alarms.
The patient may not receive therapy if the afflicted ventilators are used; this could happen even if the battery is not completely exhausted. Death and hypoventilation are just two of the grave health effects that could result from this.
Philips had sent all the affected customers an Urgent Medical Device Notice notifying customers to update the devices to the latest software version in March.
Notable Developments In April 2024, Philips received a warning letter from the FDA that outlined issues regarding imaging technology manufacturing practices in China for the Philips Incisive CT patient interface monitor.
Philips also announced a final consent decree between the FDA and the U.S. Department of Justice. The consent decree primarily focuses on Philips Respironics' business operations in the United States. It offers clarity and a defined roadmap to demonstrate compliance with regulatory requirements and restore the Philips Respironics business.
Koninklijke Philips N.V. Price
Koninklijke Philips N.V. price | Koninklijke Philips N.V. Quote
Zacks Rank & Stocks to Consider PHG carries a Zacks Rank #3 (Hold) at present.
Some better-ranked stocks in the broader medical space that have announced quarterly results are Align Technology, Inc. (NASDAQ: ALGN), Ecolab (NYSE: ECL) and Boston Scientific Corporation (NYSE: BSX).
Align Technology, carrying a Zacks Rank of 2 (Buy), reported first-quarter 2024 adjusted EPS of $2.14, beating the Zacks Consensus Estimate by 8.1%. Revenues of $997.4 million outpaced the consensus mark by 2.6%.
Align Technology has a long-term estimated growth rate of 6.9%. ALGN's earnings surpassed estimates in three of the trailing four quarters and missed once, the average surprise being 5.9%.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 13.3%. ECL's earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 1.7%.
Ecolab's shares have rallied 33.8% against the industry's 9.3% decline in the past year.
Boston Scientific reported first-quarter 2024 adjusted EPS of 56 cents, beating the Zacks Consensus Estimate by 9.8%. Revenues of $3.86 billion surpassed the Zacks Consensus Estimate by 4.9%. It currently carries a Zacks Rank #2.
Boston Scientific has a long-term estimated growth rate of 12.5%. BSX's earnings surpassed estimates in all the trailing four quarters, the average surprise being 7.5%.
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