MiMedx Files Tortious Interference Lawsuit Against Organogenesis
MARIETTA, Ga., Dec. 31, 2014 /PRNewswire/ -- MiMedx Group, Inc. (NASDAQ: MDXG), the leading regenerative medicine company utilizing human amniotic tissue and patent-protected processes to develop and market advanced products and therapies for the Wound Care, Surgical, Orthopedic, Spinal, Sports Medicine, Ophthalmic and Dental sectors of healthcare, announced it has filed a federal lawsuit against Organogenesis, Inc., manufacturer of Apligraf® and Dermagraft®, two skin substitute products that compete with MiMedx's EpiFix® allograft.
In June 2013, the MiMedx allografts were suddenly and unexpectedly removed from the 65IIA Federal Supply Schedule ("FSS") of the Veterans Administration ("VA"). Immediately after the removal, MiMedx challenged that action, and in a matter of just days, the VA determined that the action to remove the MiMedx allografts was not warranted and they were fully restored to the FSS. In addition, the VA issued an apology letter to MiMedx for the action. The Company then inquired through a Freedom of Information Act ("FOIA") request to the VA to ascertain the origin of this unusual and abrupt action. This FOIA response was received by MiMedx on December 3, 2014. Through the FOIA response, it was determined that Organogenesis provided material misinformation to the VA in order to improperly influence the VA to take action against MiMedx products. The lawsuit alleges that Organogenesis engaged in malicious actions that tortiously interfered with MiMedx's contractual relationship selling into the VA. MiMedx's investigation of Organogenesis's improper tactics is ongoing, and MiMedx will continue to pursue any and all remedies available to it to address the unlawful actions undertaken by Organogenesis.
Parker H. "Pete" Petit, Chairman and CEO, stated, "For quite some time, we have had suspicions that Organogenesis was perpetrating improper influences at certain Federal agencies. Recently, these suspicions were confirmed when we obtained the FOIA response from the VA related to the June 2013 temporary removal of our allografts from the FSS. It was extremely disappointing to finally learn from the FOIA information the extent to which Organogenesis had used its law firm to misinform the VA in its desperate attempt to have the VA remove allografts from the FSS. The misinformation was appalling."
"The measures taken by Organogenesis in the VA matter, as well as in different matters involving at least one other Federal agency, substantiate an unfortunate pattern of attempts on the part of Organogenesis to influence Federal agencies with biased, misleading and inaccurate information in order to damage MiMedx. Of course, these past practices make us suspicious of the influence of Organogenesis on the actions taken by the Food and Drug Administration ("FDA") through their Untitled Letter of August 28, 2013. We will continue to pursue this matter until we are certain that no improper interaction and influences on the part of Organogenesis have taken place at other Federal agencies to otherwise improperly and unfairly harm MiMedx," added Petit. Mr. Petit further stated, "Of course, we have no issues with having our products compete with Organogenesis products in the marketplace, but these types of improper actions are well beyond the boundaries of legitimate business practices."
In addition to tortious interference, MiMedx's suit against Organogenesis asserts unjust enrichment. The damages sought in the lawsuit were not specified. The lawsuit was filed in the United States District Court for the Northern District of Georgia.
"Also, to put this in perspective, please review our press release of May 20, 2014, regarding a previous attempt on the part of Organogenesis to disrupt our business activities," concluded Petit.
Shareholder Call
On Friday, January 2, 2015, beginning at 10:30 a.m. Eastern Standard Time, MiMedx management will host a live broadcast of its conference call with shareholders to present prepared remarks and respond to questions regarding its lawsuit against Organogenesis. A listen-only simulcast of the MiMedx Group conference call will be available on-line at the Company's website at www.mimedx.com. A 30-day on-line replay will be available approximately one hour following the conclusion of the live broadcast. The replay can also be found on the Company's website at www.mimedx.com
About MiMedx
MiMedx® is an integrated developer, processor and marketer of patent protected regenerative biomaterial products and bioimplants processed from human amniotic membrane. "Innovations in Regenerative Biomaterials" is the framework behind our mission to give physicians products and tissues to help the body heal itself. Our biomaterial platform technologies include AmnioFix® and EpiFix®, our tissue technologies processed from human amniotic membrane that is derived from donated placentas. Through our donor program, a mother delivering via full-term Caesarean section birth can elect in advance of delivery to donate the placenta in lieu of having it discarded as medical waste. We process the human amniotic membrane utilizing our proprietary PURION® Process, to produce a safe and effective implant. MiMedx® is the leading supplier of amniotic tissue, having supplied over 300,000 allografts to date for application in the Wound Care, Surgical, Sports Medicine, Ophthalmic and Dental sectors of healthcare.
Safe Harbor Statement
This press release includes statements that look forward in time or that express management's beliefs, expectations or hopes. Such statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, the Company's ability to be certain that no improper interaction and influences are taking place at federal agencies in regards to its products and the Company's success in obtaining judgment in its lawsuit against Organogenesis. These statements are based on current information and belief, and are not guarantees of future performance. Among the risks and uncertainties that could cause actual results to differ materially from those indicated by such forward-looking statements include that the Company may not be able to prevent improper interaction and influences from taking place at federal agencies in regards to its products, the normal risks associated with legal proceedings, and the risk factors detailed from time to time in the Company's periodic Securities and Exchange Commission filings, including, without limitation, its 10-K filing for the fiscal year ended December 31, 2013, and the most recent Form 10-Q. By making these forward-looking statements, the Company does not undertake to update them in any manner except as may be required by the Company's disclosure obligations in filings it makes with the Securities and Exchange Commission under the federal securities laws.
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SOURCE MiMedx Group, Inc.
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