RECALL INDEX 2017Q3

© 2017 Stericycle, Inc. All rights reserved. 2

Recall Index • Q3 2017

StericycleExpertSolutions.com

Consumer product recalls dipped 8% to 59 – the lowest number since Q1 2015. Recalled units increased 35% to 4.6 million, which is still the second lowest since Q4 2012.

CONNECTING THE DOTS

1. 76.1% of recalled units were due to entrapment/strangulation or laceration. No other hazard was responsible for more than 6%.

2. Sports/recreational activities & equipment made up the top recall category for the sixth quarter in a row with 23 recalls. No other category had more than 9.

3. Incidents plummeted 92% to 895, the lowest since Q4 2015. Injuries decreased 62.3% to 114, the first quarter with a decline since Q4 2016.

TOP CATEGORY BASED ON RECALLS

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CONSUMER RECALLS & UNITS

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AVERAGE REPORTED CONSUMER INJURIES BY QUARTER

AVERAGE FINES PER QUARTER ISSUED BY CPSC

76.2% of recalled units were home furnishings and fixtures, making it the top category. No other category exceeded 9%.

2015 AVG. 2016 AVG.

$4.7MM

$9.3MM$7.1MM

2017 AVG.

2015 AVG.89.75

2016 AVG.261.25

2017 AVG.207.67

FLAWED FURNISHINGS

Toys

10.2%Child Nursery Equipment & Supplies

10.2%

Home Furnishings& Fixtures

15.3%PersonalUse Items

11.9%

Sports/Recreational Activities & Equipment

39%

© 2017 Stericycle, Inc. All rights reserved. 3

Recall Index • Q3 2017

StericycleExpertSolutions.com

Airbags

NHTSA recalls climbed 5% to 197 – the second consecutive quarter with fewer than 200 recalls, which last occurred in Q4 2013 and Q1 2014. Recalled units rose 76% to 9.5 million. Although an increase, this is still below 4 of the last 6 quarters.

CONNECTING THE DOTS

1. 21.3% of NHTSA recalls were equipment. There were 22 more recalls in this category than any other.

2. Automobiles accounted for 64.6% of recalled units, down from 94.9% in Q2. 88.8% of NHTSA recalls were automobiles.

3. 74.7% of recalled automobile VINs were issued by 4 companies.

Electrical systems made up the second highest category based on units at 17.2%. This is a stark difference from Q2, when it made up just 0.4%.

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NHTSA RECALLS & UNITS

TOP CAUSES OF RECALLED UNITS BY QUARTER

NHTSA RECALLED UNITS BY

PRODUCT TYPE

Automobile

64.6%Equipment

31.2%

NHTSA RECALL CATEGORIES BASED ON UNITS

Airbags

4,390,195

Electrical System

1,635,541

Steering

720,997

Service Brakes

651,068

Q32017

ELECTRICAL RECALLS SPARKED

Airbags Airbags AirbagsAirbags

Q42016

Seat Belts

Q22016

Q12017

Q22017

Q12016

Q42015

Visibility

Q32016

Seat Belts

Tire

4.2%

© 2017 Stericycle, Inc. All rights reserved. 4

Recall Index • Q3 2017

StericycleExpertSolutions.com

Pharmaceutical recalls ticked up 3% to 89 – the highest since Q4 2014. Recalled units increased 290% – more than any quarter since Q1 2012 and the fourth highest since Q1 2005.

CONNECTING THE DOTS

1. Failed specifications accounted for 24.7% of recalls, making it the top cause for the fifth consecutive quarter.

2. There were just 126,838 Class I units recalled, a decline of 98.9% from Q2.

3. 70 companies experienced a recall in Q3 – the highest number since Q2 2014.

OF PHARMACEUTICAL RECALLS WERE NATIONWIDE

% OF PHARMACEUTICAL UNITS BY CLASS

PHARMACEUTICAL RECALLS & UNITS

79%

TOP PHARMACEUTICAL CAUSES BASED ON RECALLS

Powered by one large recall, sterility issues were the top cause of recalled units at 96.7%.

STERILITY SLIP-UP Failed Specs

24.7%Sterility

15.7%Mislabeling

15.7%Foreign Materials

13.5%

Class II

98.9%

Class III

1%

Class I

0.1%

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© 2017 Stericycle, Inc. All rights reserved. 5

Recall Index • Q3 2017

StericycleExpertSolutions.com

Medical Device recalls declined 39% to 167 – the lowest quarter since Q4 2011. Despite this steep drop, recalled units ticked up 1% to 68 million – higher than 16 of the last 19 quarters.

CONNECTING THE DOTS

1. The average recall size was 407,256 units – higher than any quarter since Q2 2012.

2. Software was the top recall cause for the sixth quarter in a row.

3. 39% of recalls were distributed both domestically and internationally, the lowest since at least 2013.

89.4% of units were recalled due to sterility issues – making it the top cause for the third consecutive quarter.

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MED DEVICE RECALLS & UNITS

TOP MEDICAL DEVICE CAUSES BASED ON RECALLS

AVERAGE CLASS I UNITS RECALLED PER QUARTER

OF MEDICAL DEVICE RECALLS WERE NATIONWIDE

56%

2017 AVG.

2016 AVG.

2015 AVG.

615,919

310,158

276,233

UNSTERILE PERIL

QualityIssue

17.4%

Manufacturing Defect

9.6%

Mislabeling Issue

14.4%

SoftwareIssue

24.6%

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Q22016

© 2017 Stericycle, Inc. All rights reserved. 6

Recall Index • Q3 2017

StericycleExpertSolutions.com

FDA food recalls declined 11% to 158 – the lowest since Q1 2016. Recalled FDA food units increased 19% to 106.6 million, higher than 20 of the last 22 quarters. USDA recalls dropped 49% to 24 – tied for lowest since Q3 2014. Recalled USDA pounds decreased 27% to 7.5 million – still higher than 5 of the last 7 quarters.

CONNECTING THE DOTS

1. Foreign materials accounted for 95.6% of recalled USDA pounds. That’s compared to just 6.2% in Q2.

2. 96.9% of recalled FDA food units were due to undeclared allergens, up from just 8.4% in Q2.

3. Undeclared allergens were also the top cause of FDA food recalls, accounting for 53.8%. That’s an increase from 37.1% in Q2.

TOP USDA CATEGORY BASED

ON POUNDS

95.6% of recalled FDA units and 97.9% of USDA pounds were considered Class I – the most serious classification.

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FDA FOOD RECALLS & UNITS

TOP FDA FOOD

CATEGORY BASED ON RECALLS

TOP FDA FOOD RECALL CAUSES BASED ON UNITS

Mislabeling

0.2%

Quality

0.7%

Bacterial Contamination

2.2%

Undeclared Allergens

96.9%

DIETARY DANGERS

Beef

0.2%

Poultry

1.1%

Pork

2.0%

Multiple

96.7%

Prepared Foods

17.7%Produce

12.7%

Baked Goods

12%Supplements

11.4%

StericycleExpertSolutions.com7© 2017 Stericycle, Inc. All rights reserved.

A Class I recall, according to the FDA, is a situation in which there is a reasonable probability that the product will cause serious adverse health consequences or death. A Class II recall is a situation in which the product could cause temporary or medically reversible adverse health consequences or where the probability of serious adverse health consequences is remote. The FDA defines a Class III recall as a situation in which the product is not likely to cause adverse health consequences.

Stericycle Expert Solutions helps partners minimize risk to the public and to their company brand by executing and planning for product recalls efficiently, effectively, and compliantly. Each quarter, we analyze cumulative recall data across five product categories. This helps our partners navigate the regulatory environment and identify trends.

How the Stericycle Recall Index is Compiled

The Stericycle Recall Index gathers and tracks cumulative data from the four primary federal agencies that oversee recalls in the United States: the Consumer Product Safety Commission (CPSC), the Food and Drug Admin-istration (FDA), the Food Safety and Inspection Service (FSIS) of the United States Department of Agriculture (USDA), and the National Highway Traffic Safety Administration (NHTSA).

FDA Data

To track trends in food, pharmaceutical, and medical device recalls, the Stericycle Recall Index uses information publicly available in news releases posted on the FDA website. For additional insight into recalls governed by the FDA, Stericycle collects and analyzes data from the agency’s weekly enforcement reports, which provide additional details including recall class, quantity of units affected, and number of reported incidents.

CPSC Data

For further insight into consumer product recall trends, Stericycle analyzes data from CPSC recall announcements. When compiling statistics and analyzing trends for consumer product recalls, the Stericycle Recall Index uses standard product categories and hazards recognized by the CPSC.

USDA Data

For additional insight into food recall trends involving meat, poultry, and egg products, the Stericycle Recall Index collects and analyzes data from recall announcements posted on the USDA’s FSIS website. Statistics and trends are compiled using standard product categories, classifications, and reasons for recalls as recognized by the USDA.

NHTSA Data

To understand trends in the automotive industry, the Stericycle Recall Index analyzes data from NHTSA reports on recalls of autos, child seats, equipment, and tires.

Terminology

Announced recalls represent those recalls documented in news releas-es published on agency websites. Enforced recalls refer to those recalls documented in weekly FDA enforcement reports that are summarized based on the FDA assigned Event ID. Their documentation can lag behind announced recalls by weeks or even months because the recall process may take time to complete.

Stericycle Expert Solutions & the Recall Index Explained