MiMedx Announces Receipt Of Civil Subpoena

(RTTNews) - Regenerative medicine company MiMedx Group Inc (MDXG) on Wednesday said it has received a subpoena from the Office of Inspector General ("OIG") of the Department of Health and Human Services ("HHS") in connection with a civil investigation into matters primarily related to the company's sales and marketing activities.

MiMedx said it intends to cooperate fully with the government in its investigation, and the company will attempt to expedite the process. MiMedx has already begun the process of producing the responsive documents. The company said no proceedings have been initiated at this time and that it cannot predict whether any proceeding might be initiated.

Parker Petit, Chairman and CEO, said, "I can assure you that the corporate officers at MiMedx are not aware of anything that would stimulate this investigation. We have continually maintained and improved a robust compliance program. We have been very focused on the thoroughness of our compliance policies and our staff adhering to those policies."

Petit further said, "We are aware of investigations in the wound care market over the past several years, in particular, the ongoing investigation into the sales and marketing practices of Advanced BioHealing ("ABH"), the original manufacturer of Dermagraft. We anticipated that the ABH investigation could lead to a review of other industry participants, particularly in view of the fact that several industry participants, including MiMedx and some of our competitors, have hired former ABH employees."

"We screen all of our applicants very carefully. With respect to former ABH applicants, we sought additional input from some former ABH corporate management who joined MiMedx and who were familiar with the suspected violations and the individuals involved. Approximately 18 months ago, we had confirmation of a violation of our compliance policies, and within 24 hours, that individual was terminated."