Shares of Philips took a hit on Friday following an announcement from the U.S. Food and Drug Administration (FDA) requesting additional testing on sleep and respiratory care devices. This development comes after the recall of millions of these devices due to concerns over potentially harmful foam.
Recall Continues to Impact Philips Stock
Amsterdam-based Philips saw its shares (PHIA, -9.22% PHG, +0.56%) drop by 9% in response to the FDA’s statement. The lingering effects of the ongoing recall have put significant pressure on the company’s stock throughout 2021 and 2022.
FDA Calls for Enhanced Testing
In a statement, Dr. Jeff Shuren, the director of the FDA’s Center for Devices and Radiological Health, expressed dissatisfaction with the progress of the recall. He emphasized the agency’s commitment to safeguarding the health and safety of individuals who use these devices. The FDA believes that the testing and analysis provided by Philips thus far have not adequately evaluated the risks associated with the recalled devices.
Furthermore, the FDA has specifically called for additional testing to assess the risk posed by those who have already used the recalled devices. Philips confirmed that discussions with the FDA are still underway to determine the specifics of this further testing.
Aviva’s Stock Surges Amid Acquisition Talks
On the flip side, insurer Aviva (AV, +9.04%) experienced a 9% jump in its shares following speculation in The Times of London about a potential acquisition by a foreign buyer. Another major U.K. insurer, Legal & General (LGEN, +2.52%), also saw its stock rise by 3%.
European Markets Show Resilience
Despite recent turbulence in U.S. stock markets, European markets demonstrated resilience. Bouyed by a recovery in U.S. stocks on Thursday, the broader European stock market experienced gains ahead of the highly anticipated nonfarm payrolls report on Friday. The U.K. FTSE 100 (UK:UKX) rose by 0.3%, the German DAX (DX:DAX) rose by 0.6%, and the French CAC 40 (FR:PX1) rose by 0.5%.