Invacare Corporation Responds to Allegations Regarding Recall Procedures
Elyria, Ohio, Sept. 3, 2002--(BUSINESS WIRE)--Invacare Corporation (NYSE: IVC) Chairman and Chief Executive Officer A. Malachi Mixon, III today detailed an extensive series of steps that the company has had in place since 2000 to recall its power wheelchairs, fix potential problems, make engineering design improvements and effectively communicate those actions to its customers. These steps were taken expeditiously after several reports reached the company in 1999 of some safety problems related to its power wheelchairs. Mixon was responding to a news article in the Cleveland Plain Dealer (September 1, 2002) challenging the company's responsiveness and effectiveness in conducting a power wheelchair recall.###
Mixon said, "Invacare has a long history of providing safe, effective and innovative products for people with disabilities. We deeply regret the two deaths that occurred several years ago related to our product design. When we learned of some potential problems with our power wheelchairs, we immediately began investigating and developing ways of correcting them. We commenced a wide-ranging recall of the affected wheelchairs, directly communicating in writing nine times to date with our almost 6,000 power wheelchair dealers, since they are the ones who provided those wheelchairs to the individuals who use them. We also conducted a significant direct mail campaign to consumers and posted information on our web site so that they could learn of the recall. Our records show that the recall effort is quite successful, exceeding the typical rates of other industry-related recall campaigns, and we are continuing that effort."
Several points made by Mixon include:
- Prior to 1999, Invacare had no indication there was a pattern or a trend that would have caused us to take corrective action related to our power wheelchairs.
- Invacare's records show that two incidents in 1994 (John Rothermel) and 1995 (Arthur Wilbur) referred to in the article did not involve any finding of a wheelchair design defect. In neither incident was a claim made on behalf of those individuals against Invacare or its dealers.
- Invacare far exceeded the recall notification requirements of the Food and Drug Administration and continues to communicate directly with the dealers, who have the records of consumers who use the company's products.
- Contrary to the statement in the article, Invacare did post a notice on its web site beginning in September 2000 to alert consumers of the recall and has disclosed in its Form 10-K reports filed with the Securities and Exchange Commission that it is a defendant in a number of product liability lawsuits. Both the web site and the Form 10-K are updated periodically.
- The recall effort to date has been remarkably successful in getting repairs made to wheelchairs that are still in service. Invacare continues to work with its dealers to make repairs.
Mixon provided a brief chronology of the various incidents and the company's efforts to fix the problems and communicate the recall campaign:
-- Invacare first learned of a fire-related death allegedly involving a defect in its power wheelchair in January 1999. The company immediately began investigating the incident to determine the cause of that fire. During the course of that investigation, an additional death was reported later in 1999. The company then concluded that a design change was needed, and began the redesign process. The company initiated the recall in April 2000, and developed a repair kit for the problem.
-- Additional information about one of the original cases came to the company's attention in May 2000, involving a different fault condition in the power wheelchair. Again, the company immediately investigated, expanded the recall to include all power wheelchairs manufactured from 1988 through June 2000, and developed changes to address this problem.
- Since dealers have direct consumer contact and are in the best position to know who has purchased our products, the recall campaign communication was concentrated on reaching those dealers repeatedly with necessary information.
- Throughout the campaign, the company contacted its nearly 6,000 power wheelchair dealers by mail at least nine times, far in excess of the three mailings required by the Federal Food & Drug Administration for such recalls.
- In addition to this dealer outreach, Invacare mailed more than 136,000 postcards to individuals who might be affected by the recall. These addresses were purchased from subscription lists of leading publications reaching people with disabilities who use wheelchairs.
- The company's Service Center Network of more than 500 locations throughout the United States was enlisted to assist in making the repairs at no charge and to address any other consumer issue.
- Several consultants were engaged to help track the recall campaign and work with dealers to assist them in the customer notification process.
- Other outreach activities included dealer-supported local newspaper advertising, personal visits to dealers by Invacare representatives and "service and repair days" at dealer locations.
- An FDA inspector visited Invacare in May 2000 to review the company's power wheelchair recall and found no deficiencies with Invacare's recall and corrective procedures.
The recall campaign has successfully resulted in repairs being made to a significant proportion of the power wheelchairs still in use; typically, wheelchairs are replaced after approximately five or six years of usage, so many of the wheelchairs manufactured prior to 1996 are out of service.
"Invacare responded appropriately and aggressively to correct problems that came to our attention," Mixon said. "There have been no serious injuries or deaths reported over the last three years; moreover, there are no pending lawsuits related to fires involving Invacare power wheelchairs."
Mixon noted that Invacare maintains a state-of-the-art Corporate Test Lab and its wheelchairs are designed in accordance with ANSI (American National Standards Institute) and RESNA (Rehabilitation Engineering and Assistive Technology Society of North America) standards. The company's warranties are among the most comprehensive in the industry.
Mixon concluded, "Invacare is the largest manufacturer of power wheelchairs in the world. We believe that we have earned this position over many years because Invacare products provide superior functionality, reliability and safety for consumers. Health care professionals who prescribe Invacare power wheelchairs choose them specifically to address complex physical disabilities in advanced ways that other wheelchairs cannot. We know that we have to earn that reputation every day, so our design engineers are continuously working to improve upon our products by enhancing the sophistication of our styling, motors, electronics, seating systems, comfort and safety. For all these reasons, we strongly believe that Invacare's power wheelchairs are the best power wheelchairs in the world."
Mixon went on to say, "We're proud of how we handled this recall. If there is a benefit coming from this story, it is that it will help us in our continuing efforts to reach people who may still have one of the products that should be repaired. If anyone needs their power wheelchair repaired, we're trying to find them and we ask that they contact their local Invacare dealer or Invacare's Customer Service center at 1-800/333-6900 and select option "8". They also can visit our Web site and click on Service Center Locator."
Invacare's Form 10-K reports filed with the Securities and Exchange Commission have regularly stated that the company is a defendant in a number of product liability actions. Management indicated in those reports that it did not believe the outcome of the actions would be material to Invacare's business or financial condition, and it continues to believe these statements are accurate.
Invacare Corporation (NYSE:IVC - news), headquartered in Elyria, Ohio, is the global leader in the manufacture and distribution of innovative home medical products that promote recovery and active lifestyles. The Company has 5,400 associates and markets its products in 80 countries around the world. For more information about the Company and our products, visit Invacare's Web site.
This press release contains forward-looking statements within the meaning of the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995. Terms such as "will," "should," "achieve," "increase," "plan," "can," "expect," "pursue," "benefit," "continue," "exceed," "improve," "believe," "anticipate" "build," "strengthen," "new," "lower," "drive," "seek," "are convinced", "hope," and "create," as well as similar comments, are forward-looking in nature. Actual results and events may differ significantly from those expressed or anticipated as a result of risks and uncertainties which include, but are not limited to the following: pricing pressures, increasing raw material costs, the consolidations of health care customers and competitors, government reimbursement issues including those that affect the viability of customers, the ability to design, manufacture and distribute new products with higher functionality and lower costs, the effect of offering customers competitive financing terms, Invacare's ability to effectively identify, acquire and integrate strategic acquisition candidates, the difficulties in managing and operating businesses in many different foreign jurisdictions, the timely completion of facility consolidations, the difficulties in acquiring and maintaining a proprietary intellectual property ownership position, the overall economic, market and industry growth conditions, foreign currency and interest rate risk, Invacare's ability to improve financing terms and reduce working capital, as well as the risks described from time to time in Invacare's reports as filed with the Securities and Exchange Commission. We undertake no obligation to review or update these forward-looking statements or other information contained herein.
Contact: Media Inquiries: Edward Howard & Co. Kathy Obert, 440-329-6111 or Invacare Corporation Susan Elder, 440-329-6549 or Investor Inquiries: Invacare Corporation Robert Gudbranson, 440-329-6001