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The U.S. Food and Drug Administration (FDA) found that devices made at Koninklijke Philips N.V.'s (NYSE:PHG) Bothell, Reedsville, and Nederland facilities were adulterated due to manufacturing, storage, and quality control practices that failed to meet current Good Manufacturing Practice (GMP) standards.
The facilities manufacture medical devices such as ultrasound systems and cardiovascular devices.
The devices made at these facilities are considered “adulterated” under U.S. law due to non-compliance with current good manufacturing practices, the FDA stated in the letter.
According to a Tuesday update on the agency’s website, Philips failed to adequately oversee its internal contractor, Global Complaint Handling Operations (GCHO), which manages complaint reviews and Medical Device Reporting (MDR).
GCHO was not properly evaluated or listed as an approved supplier, and complaint investigations were often delayed or incomplete.
The agency also identified lapses in Corrective and Preventive Action (CAPA) systems, noting that recurring product issues, such as fluid ingress and articulation failures in transducers, were not consistently addressed.
Additionally, Philips distributed refurbished transducers beyond their validated service life, prompting a recall and updated labeling.
At its Nederland facility, FDA inspectors found design-validation shortcomings in the IntelliSpace Cardiovascular (ISCV) software, including insufficient cybersecurity and safety risk assessments. The firm also failed to submit timely MDRs for ISCV software malfunctions that could affect patient diagnosis or treatment.
While Philips has taken corrective actions, including updates to inspection protocols and CAPA procedures, the FDA determined several responses were inadequate or incomplete, indicating further verification will be needed through follow-up inspections.
The findings add regulatory pressure on Philips, which is still managing the long-term impact of its respiratory device recall and ongoing FDA scrutiny of its quality systems.
Price Action: PHG stock is down 5.85% at $27.20 at the last check on Tuesday.
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