Free teddy bears that have been given to more than 5200 sick children in the past five years are being recalled due to safety concerns.

Children's product manufacturer phil&teds has issued a recall notice today urging parents to throw the bears, dubbed 'phil&teddy' away immediately.

A spokesman said it had recently come to the company's attention that the bear fuzz might come loose and/or the seam may split exposing the filing material .

The Teddy Bears were given to children undergoing surgery in Wellington, Christchurch and Waikato Hospitals between 2010 and February 2015, as part of its sponsorship of New Zealand's Surgical Research Trust.

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The bear was designed to make a child's recovery just a little bit more 'bear-able'" and used as an explanatory aid by surgeons when talking to a child about their procedure.

"The idea was to help put a smile on a child's face and to provide a friend for comfort during a scary time."

The spokesman said phil&teds was dedicated to product safety, regardless of whether it was a free gift or purchased.

The recall is being issued and the programme immediately ceased to avoid any potential risk children, he said.

The 'phil&teddy' Teddy Bear can be identified by the words 'phil&teddy' printed on the front and 'phil&teds' on the rear.

Phil&teds produce strollers and other baby products.

The spokesperson confirmed there hadn't been any reports of injury or choking, the recall was a precautionary measure.

Company chief executive Campbell Gower said the problem was initially discovered by staff in a hospital who noticed a child pulling the fur off the bear.

"That was then taken off them and a report filed at a hospital and that information was given to the trust who gave the bears to the Commerce Commission.

"The commission and phil&teds each carried out its own product testing where more faults were discovered and the decision to pull the bears was made."

The good thing is we've not had any reports of injury so that's great."

Mr Gower said the main hazard for children is choking.

As for if there will be a new initiative, Mr Gower was unsure.

"We don't know yet, it is a really good initiative. It's not only a cute and comforting thing to do, it actually is practical for a surgeon to explain on the bear what's going to happen to the child present, they have this feeling that the procedure's actually on the bear so it does actually make it a lot less alarming, apparently."