Why Is Philips Stock Trading Lower Today?

Tuesday, the FDA issued a warning to patients and healthcare providers to carefully monitor Koninklijke Philips NV's PHG DreamStation 2 continuous positive airway pressure (CPAP) machines for signs of overheating.

This new safety issue comes as the FDA closely monitors Philips' handling of the June 2021 recall impacting millions of sleep therapy and respirator machines, including CPAP machines. 

The polyester-based polyurethane (PE-PUR) foam used in the recalled machines to reduce sound and vibration can break down and could potentially be breathed in or swallowed, posing possible risks to the person using the device. 

Also Read: How Sleep Device Player ResMed Is Gaining Philips' Market Share In Flow Generator Market - Analysts Weigh In.

The DreamStation 2 machines are manufactured with silicone-based foam, not PE-PUR foam, and were not included in the June 2021 recall.

The FDA recently received medical device reports associated with thermal issues such as fire, smoke, burns, and other signs of overheating while people are using Philips DreamStation 2 CPAP machines.

Between August 1, 2023, and November 15, 2023, the FDA received more than 270 reports of problems associated with the device, compared with fewer than 30 reports in the previous three years.

The FDA agency notes that the DreamStation 2 CPAP machines were distributed as replacements for recalled DreamStation 1 CPAP machines.

Price Action: PHG shares are down 3.17% at $20.48 on the last check Wednesday.