We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Baxter (BAX) Recovers After Life2000 Ventilation Systems Recall
Read MoreHide Full Article
Shares of Baxter International (BAX - Free Report) have gained 2.8% since Jun 26, after the company announced the recall of its Life2000 Ventilation System. Though the share price had declined following the news, it recovered following reports of potential discussion on divestment of BAX’s kidney care segment.
The device, a portable ventilator for patients suffering from chronic respiratory failure or other breathing issues, has been recalled by Baxter. The recall follows the detection of damaged battery charger dongles, which can prevent the ventilator’s internal battery from charging. Baxter had acquired Life2000 through its $10.5 billion purchase of Hillrom in 2021.
Significance of Life2000
Per Baxter, Life2000’s recall is critical as it directly impacts the reliability of the Life2000 ventilators, potentially leaving patients without necessary respiratory support. Damaged dongles prevent battery charging, which could lead to ventilator failure and severe health consequences. Per the FDA's Database entry, Baxter has strictly advised customers to check for damage, maintain backup devices and replace faulty chargers promptly. This is the latest in a series of recalls since Baxter acquired Hillrom, underscoring the ongoing challenges in ensuring the safety and efficacy of these medical devices.
More on the News
According to a Jun 26 entry in the FDA‘s recall database, the recall affected more than 2,500 units distributed in the United States. The FDA has labeled the recall as a Class I event, its severest classification.
In 2023, the company also recalled thousands of Life2000 systems due to the risk of patient oxygen desaturation when the devices were connected to third-party oxygen concentrators. At the time, Baxter reported that it received no reports of death related to the safety problem, though there were reports of hospitalizations.
Life2000 is not the only device of Hillrom that Baxter was forced to recall since the acquisition. In 2022, Baxter felt the urgent need to recall the Volara ventilator system after an injury and two deaths were tied to a device malfunction.
Industry Prospects
Per a report by MARKETSANDMARKETS, the global ventilator market size was valued at $4.2 billion in 2023. It is anticipated to reach $5.7 billion in 2028 at a CAGR of 6.4%
The robust growth will be driven by unhealthy diet, obesity and physical inactivity, which are some of the leading risk factors contributing to the burden of respiratory diseases.
Recent Developments
In May, Baxter announced the FDA approval of an expanded indication for Clinolipid (Lipid Injectable Emulsion) to include pediatric patients, including preterm and term neonates. Clinolipid is a proprietary mixed oil lipid emulsion designed to provide essential fatty acids and calories in parenteral nutrition for patients who cannot receive adequate oral or enteral nutrition.
In the same month,Baxter announced new data demonstrating that expanded hemodialysis (HDx therapy), enabled by the Theranova dialyzer, is associated with approximately a 25% lower all-cause mortality risk over up to four years compared to high-flux hemodialysis (HF HD). This finding highlights the potential of HDx therapy to significantly improve patient outcomes in long-term dialysis treatment.
Price Performance
Shares of Baxter have declined 9.7% so far this year against the industry's 1.8% rise. The S&P 500 has witnessed a 17.5% rise in the same time frame.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
Currently, Baxter carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Universal Health Services (UHS - Free Report) and Ecolab Inc. (ECL - Free Report) .
DaVita, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 13.6%. DVA’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 29.4%.
DaVita’s shares have gained 43.4% compared with the industry’s 15.2% rise in the past year.
Universal Health Services, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 14.80%. UHS’s earnings surpassed estimates in each of the trailing four quarters, with the average being 8.12%.
Universal Health Services has gained 21.3% against the industry’s 20.4% decline in the past year.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 14.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 1.3%.
Ecolab’s shares have rallied 31.3% against the industry’s 12.9% decline in the past year.
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Shutterstock
Baxter (BAX) Recovers After Life2000 Ventilation Systems Recall
Shares of Baxter International (BAX - Free Report) have gained 2.8% since Jun 26, after the company announced the recall of its Life2000 Ventilation System. Though the share price had declined following the news, it recovered following reports of potential discussion on divestment of BAX’s kidney care segment.
The device, a portable ventilator for patients suffering from chronic respiratory failure or other breathing issues, has been recalled by Baxter. The recall follows the detection of damaged battery charger dongles, which can prevent the ventilator’s internal battery from charging. Baxter had acquired Life2000 through its $10.5 billion purchase of Hillrom in 2021.
Significance of Life2000
Per Baxter, Life2000’s recall is critical as it directly impacts the reliability of the Life2000 ventilators, potentially leaving patients without necessary respiratory support. Damaged dongles prevent battery charging, which could lead to ventilator failure and severe health consequences. Per the FDA's Database entry, Baxter has strictly advised customers to check for damage, maintain backup devices and replace faulty chargers promptly. This is the latest in a series of recalls since Baxter acquired Hillrom, underscoring the ongoing challenges in ensuring the safety and efficacy of these medical devices.
More on the News
According to a Jun 26 entry in the FDA‘s recall database, the recall affected more than 2,500 units distributed in the United States. The FDA has labeled the recall as a Class I event, its severest classification.
In 2023, the company also recalled thousands of Life2000 systems due to the risk of patient oxygen desaturation when the devices were connected to third-party oxygen concentrators. At the time, Baxter reported that it received no reports of death related to the safety problem, though there were reports of hospitalizations.
Life2000 is not the only device of Hillrom that Baxter was forced to recall since the acquisition. In 2022, Baxter felt the urgent need to recall the Volara ventilator system after an injury and two deaths were tied to a device malfunction.
Industry Prospects
Per a report by MARKETSANDMARKETS, the global ventilator market size was valued at $4.2 billion in 2023. It is anticipated to reach $5.7 billion in 2028 at a CAGR of 6.4%
The robust growth will be driven by unhealthy diet, obesity and physical inactivity, which are some of the leading risk factors contributing to the burden of respiratory diseases.
Recent Developments
In May, Baxter announced the FDA approval of an expanded indication for Clinolipid (Lipid Injectable Emulsion) to include pediatric patients, including preterm and term neonates. Clinolipid is a proprietary mixed oil lipid emulsion designed to provide essential fatty acids and calories in parenteral nutrition for patients who cannot receive adequate oral or enteral nutrition.
In the same month,Baxter announced new data demonstrating that expanded hemodialysis (HDx therapy), enabled by the Theranova dialyzer, is associated with approximately a 25% lower all-cause mortality risk over up to four years compared to high-flux hemodialysis (HF HD). This finding highlights the potential of HDx therapy to significantly improve patient outcomes in long-term dialysis treatment.
Price Performance
Shares of Baxter have declined 9.7% so far this year against the industry's 1.8% rise. The S&P 500 has witnessed a 17.5% rise in the same time frame.
Image Source: Zacks Investment Research
Zacks Rank & Other Key Picks
Currently, Baxter carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader medical space are DaVita Inc. (DVA - Free Report) , Universal Health Services (UHS - Free Report) and Ecolab Inc. (ECL - Free Report) .
DaVita, carrying a Zacks Rank #2 at present, has an estimated long-term growth rate of 13.6%. DVA’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 29.4%.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
DaVita’s shares have gained 43.4% compared with the industry’s 15.2% rise in the past year.
Universal Health Services, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 14.80%. UHS’s earnings surpassed estimates in each of the trailing four quarters, with the average being 8.12%.
Universal Health Services has gained 21.3% against the industry’s 20.4% decline in the past year.
Ecolab, carrying a Zacks Rank of 2 at present, has an estimated long-term growth rate of 14.3%. ECL’s earnings surpassed estimates in each of the trailing four quarters, with the average surprise being 1.3%.
Ecolab’s shares have rallied 31.3% against the industry’s 12.9% decline in the past year.