Amid buzz around a short sell­er’s FBI vis­it, MiMedx stock craters fol­low­ing in­ter­nal in­ves­ti­ga­tion

A bio­phar­ma in Geor­gia tied to an un­usu­al FBI sto­ry is watch­ing its stock tum­ble this morn­ing fol­low­ing news that the com­pa­ny is launch­ing an in­ves­ti­ga­tion in­to its own prac­tices.

The com­pa­ny, called MiMedx $MDXG, has been in­volved in a nasty re­la­tion­ship with short sell­ers that re­cent­ly took a turn for the worse. Now, the com­pa­ny’s in­ter­nal in­ves­ti­ga­tion is de­lay­ing the re­lease of its fi­nan­cial re­sults, in­clud­ing its an­nu­al state­ment that would de­tail last year’s per­for­mance.

In­vestors aren’t hap­py. The stock has fall­en more than 31% as of press time Tues­day morn­ing.

This is the kind of ac­tiv­i­ty that will like­ly make short sell­ers cheer. An in­ter­est­ing de­vel­op­ment con­sid­er­ing the com­pa­ny’s re­cent his­to­ry.

Park­er “Pe­te” Pe­tit

Just days ago, news broke that a Cal­i­for­nia short sell­er named Marc Co­hodes had re­ceived a vis­it from FBI agents at his home in Sono­ma Coun­ty. Co­hodes has laid out his crit­i­cism of MiMedx all over the web, in­clud­ing hun­dreds of tweets that tear down MiMedx and the com­pa­ny’s CEO, Park­er “Pe­te” Pe­tit. What did these tweets look like? “I will bury the lit­tle fel­la in a shoe box,” one says from Oc­to­ber.

The FBI showed up at Co­hodes’ home with a print­out of some ug­ly tweets made months ear­li­er, in­clud­ing the one above. In short, the agents told the short sell­er he should stop send­ing threat­en­ing tweets about the CEO, or else.

That’s ac­cord­ing to a sto­ry from Bloomberg, which notes that Pe­tit, the lam­bast­ed CEO, hap­pens to be a top Re­pub­li­can fundrais­er in the state of Geor­gia. The re­quest to dis­patch FBI agents came from the At­lanta of­fice. Co­hodes’ lawyer called that in­to ques­tion in a Jan­u­ary 12 com­plaint let­ter to the Jus­tice De­part­ment.

“As part of your in­ves­ti­ga­tion, you should de­ter­mine how Mr. Pe­tit was able to in­flu­ence the FBI to take ac­tion de­signed to sti­fle one of his com­pa­ny’s crit­ics,” at­tor­ney David Shapiro wrote.

Marc Co­hodes. Im­age: BNN

This is not the first time MiMedx has drawn the ire of oth­ers. The com­pa­ny, which makes tis­sue grafts used to treat burns and soft tis­sue wounds, has faced law­suits brought by ex-em­ploy­ees who al­lege the com­pa­ny has fraud­u­lent­ly boost­ed its sales. It’s spent sev­er­al years chal­leng­ing the FDA, which says its grafts don’t meet reg­u­la­to­ry stan­dards.

Now, MiMedx is ad­dress­ing those con­cerns head on. The com­pa­ny’s au­dit com­mit­tee has hired le­gal and ac­count­ing ad­vis­ers to con­duct an in­ter­nal in­ves­ti­ga­tion of the al­le­ga­tions re­lat­ing to sales and dis­tri­b­u­tion. Ex­ec­u­tives are al­so re­view­ing the ac­count­ing treat­ment of cer­tain dis­trib­u­tor con­tracts, among oth­er items.

“The com­pa­ny be­lieves, based on in­for­ma­tion avail­able to date, that the out­come of such in­ves­ti­ga­tion should not have a ma­te­r­i­al im­pact on rev­enue guid­ance for 2018,” reads a state­ment.

Jake Van Naarden, Josh Bilenker, Nisha Nanda (Credit: Loxo, Aisling Capital)

Josh Bilenker and his Loxo crew are tak­ing the reins on on­col­o­gy R&D at Eli Lil­ly, culling the weak and map­ping a new path

Josh Bilenker, Jake Van Naarden and Nisha Nanda came out of Eli Lilly’s $8 billion Loxo Oncology buyout with a bundle of cash and plenty of choices on what they could do next. Start a new company, go public. Live on the beach in 5-star luxury. Contemplate the stars — in their own observatory.

So what are they doing?

They formed a new executive team that is taking over the management of Eli Lilly’s hundreds-strong oncology R&D group — essentially using Loxo as a base for a bold new experiment in Big Pharma R&D in an attempt to create a true biotech environment with the deep pockets of a top-15 industry player. They’ve recruited David Hyman from Memorial Sloan Kettering to join the team as chief medical officer. And the mandate includes culling out the oncology pipeline, highlighting their star prospects and going after new programs wherever they can find the best prospects.

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One of Wall Street’s most high-pro­file hedge funds push­es Alex­ion's CEO to the auc­tion block — and he's not budg­ing

Fresh off buying Barnes & Noble and prodding AT&T with some heavy-handed criticism after picking up a $3.2 billion stake in the company, the activist — and supremely high profile — hedge fund Elliott Management has stepped up with some M&A advice for Alexion’s management team.
And the execs on the team $ALXN are giving them a polite — but very firm — stiff arm Friday morning.
In a release out early Friday, the big biotech said that the Elliott team had been in touch to encourage them to sell the company. But that’s not on the agenda.

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Samantha Budd Haeberlein. Biogen via YouTube

UP­DAT­ED: Skep­tics pounce as Bio­gen de­tails pos­i­tive sub­group analy­sis on ad­u­canum­ab — and both sides are dig­ging in

“Exhilarating.” “A major advance.” “A milestone achievement.” If one had just tuned into the panel comments on Biogen’s presentation at CTAD, it would seem that the biotech had an impressive, disease-modifying Alzheimer’s drug in aducanumab.

But off the stage, reactions to their admittedly complicated dataset and the biotech’s explanation for resurrecting a drug that failed its futility analysis were a lot more mixed, with analysts continuing to question whether the evidence is substantial enough to warrant an FDA approval and raising new doubts on the safety side.

In an investor call later in the day, execs noted that they are not planning another study and stood by their intention, publicized in October to much surprise, to submit regulatory filings based on what they have.

“We don’t file willy nilly,” said Al Sandrock, head of R&D. “We only go to filing when we believe that there is a benefit-risk argument based on science, based on data. And if you look at our history, we haven’t done filings right and left without good reason.”

Biogen had a theory going into the Clinical Trials on Alzheimer’s Disease meeting.

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Un­lock the full End­points ex­pe­ri­ence for your com­pa­ny — and sup­port our mis­sion of in­de­pen­dent bio­phar­ma re­port­ing

I want to give readers a quick update on the most important part of our business model — premium subscriptions. We have some crucial financial goals we hope to achieve by the end of the year, and the team here in Lawrence is ready to ship some swag to kick off this limited December promotion.

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Jasper Ther­a­peu­tics launch­es out of Stan­ford with new ap­proach to stem cell treat­ment

The first girl in the trial came in with chronic diarrhea and the immune system of an untreated HIV patient. Born with a rare genetic disease that impeded her ability to make B and T cells, she had once been given a stem cell transplant but it didn’t take.  Back in the hospital, she was injected with a new experimental antibody and then given a new stem cell transplant. Soon, she gained weight. The diarrhea stopped.

Ex-Cel­gene ex­ec Ter­rie Cur­ran puts her Phath­om team in place; Car­away taps Mar­tin Williams as CEO

→ Gastrointestinal disease-focused Phathom Pharmaceuticals has shaken up its leadership team. The company has tapped former Celgene exec Terrie Curran as CEO, succeeding David Socks, who is transitioning to interim CFO. Curran was president of Celgene’s global inflammation and immunology franchise — helping with the sale of Otezla for $13.4 billion to Amgen — and has held a previous stint at Merck. In addition to Curran, the company also welcomed former Omeros CMO Eckhard Leifke as CMO, ex-Celgene exec Joseph Hand as chief administrative officer, and former general counsel for Cyclerion Therapeutics Larry Miller as general counsel. They also replaced Chris Slavinsky on the board with Takeda exec Asit Parikh.

UCB buffs up in block­buster pso­ri­a­sis race as bimek­izum­ab beats Hu­mi­ra in head-to-head

Just weeks after boasting head-to-head victories over first placebo and then J&J’s IL-23 contender Stelara in clearing psoriasis, the results are in for UCB’s last Phase III trial, in which bimekizumab went up against the world’s best-selling drug.

Only topline results are provided for today’s readout of the BE SURE study, so we won’t find out just how superior bimekizumab proved against Humira on the co-primary endpoints — standard scores known as PASI90 and IGA measuring the impact and severity of the disease — until a scientific conference in 2020.

With EMA re­view in progress, No­var­tis un­veils more pos­i­tive da­ta on asth­ma ther­a­py

Having made its marketing pitch to the EU regulator, Novartis on Thursday unveiled positive pivotal study data supporting the use of its inhaled asthma treatment.

The therapy, QMF149, consists of the long-acting beta-agonist, or LABA, called indacaterol acetate and the corticosteroid mometasone furoate. In the 2,216-patient, 52-week PALLADIUM study, asthma patients either received a medium or high dose of the Novartis therapy (150/160 μg; 150/320 μg) or mometasone furoate (MF) alone.

Black Di­a­mond rais­es an­oth­er $85M to bring new onco­gene ap­proach in­to clin­ic

Nearly a year after raising $85 million from investors, Black Diamond Therapeutics has raised another $85 million to help push its allosteric therapies into the clinic in the next few months. The Series C round was led by Boxer Capital.

Black Diamond launched last December as the first company to come out of Versant’s Ridgeline discovery engine in Basel. They had two former developers of the cancer drug Tarceva as co-founders in David Epstein and Elizabeth Buck and a relatively new approach to oncology. Within a month of their full launch, they also had $105 million in backing.