For­mer MiMedx CEO and COO are con­vict­ed on fraud, con­spir­a­cy charges

The MiMedx saga — which has in­clud­ed a months-long in­ves­ti­ga­tion, FBI in­volve­ment and al­le­ga­tions that the com­pa­ny fraud­u­lent­ly boost­ed its sales — has re­sult­ed in the con­vic­tion of two for­mer ex­ec­u­tives. But it isn’t quite over yet.

Park­er “Pe­te” Pe­tit

For­mer CEO Park­er “Pe­te” Pe­tit and for­mer COO William Tay­lor have been con­vict­ed on a se­cu­ri­ties fraud count and a con­spir­a­cy count, re­spec­tive­ly, in the South­ern Dis­trict Court of New York. The Man­hat­tan US at­tor­ney’s of­fice ac­cused the men of false­ly re­port­ing $9.5 mil­lion of rev­enue in 2015 to boost the com­pa­ny’s stock and fill their own pig­gy banks, per a Law360 re­port.

But the de­fen­dants have de­nied the ac­cu­sa­tions, and say they plan on ap­peal­ing the ver­dict. Pe­tit was ac­quit­ted on a se­cu­ri­ties fraud count, while Tay­lor was ac­quit­ted on a fraud count.

William “Bill” Tay­lor

“We are pleased that the ju­ry ac­quit­ted Mr. Tay­lor of se­cu­ri­ties fraud. We are of course dis­ap­point­ed in the ver­dict on the con­spir­a­cy count, but Mr. Tay­lor ful­ly in­tends to seek to have the ver­dict over­turned,” Tay­lor’s lawyer William Bur­ck told Law360.

MiMedx $MDXG, which pro­duces sur­gi­cal and tis­sue-graft prod­ucts for vet­er­ans and mil­i­tary hos­pi­tals, ran in­to trou­ble back in Feb­ru­ary of 2018, when the FBI showed up at the door of Marc Co­hodes. The vo­cal short sell­er had in­sult­ed the com­pa­ny and Pe­tit in hun­dreds of tweets. Af­ter FBI agents or­dered Co­hodes to stop, his lawyer went to the US De­part­ment of Jus­tice with a com­plaint.

The DOJ seemed to be al­ready in­ves­ti­gat­ing MiMedx’s sales and dis­tri­b­u­tion prac­tices. The com­pa­ny faced law­suits brought by ex-em­ploy­ees who ac­cused it of fraud­u­lent­ly boost­ing sales. And it spent sev­er­al years chal­leng­ing the FDA on whether its prod­ucts met reg­u­la­to­ry stan­dards.

MiMedx said it was con­duct­ing an in­ter­nal in­ves­ti­ga­tion in Feb­ru­ary of 2018, and that it would re­state its fi­nan­cial state­ments go­ing back six years. It part­ed ways with Pe­tit and Tay­lor and slashed 24% of its work­force to start a “new chap­ter.” By No­vem­ber, it delist­ed from Nas­daq.

The in­ter­nal in­ves­ti­ga­tion, con­duct­ed by King & Spald­ing with KP­MG as an au­di­tor, turned up a slew of ac­cu­sa­tions, in­clud­ing that MiMedx made ma­te­r­i­al mis­state­ments and omis­sions about its deals, that Pe­tit lied un­der oath when dis­cussing its largest dis­trib­u­tor, and that the com­pa­ny’s ac­tions were “de­signed to ma­nip­u­late the tim­ing and recog­ni­tion of rev­enue.”

The com­pa­ny’s shares, which once trad­ed at a high of $16.75, closed at $6.79 apiece on Thurs­day.

What comes next for the for­mer ex­ecs? Pe­tit is sched­uled for sen­tenc­ing on Feb 23, and Tay­lor is due back the fol­low­ing day. Pe­tit could be look­ing at up to 20 years for the se­cu­ri­ties fraud count, while Tay­lor’s con­spir­a­cy count could land him up to 5 years.

Clin­i­cal tri­al mon­i­tor­ing is about to change for­ev­er

In 2006, a clinical trial called ILLUMINATE halted abruptly. Trial subjects treated with an investigational drug called torcetrapib started experiencing unexpected cardiovascular problems, in some cases resulting in death. After 15 years and nearly 1 billion dollars, the development of torcetrapib froze.

Nine years later, a paper published in the journal Circulation explained how the ILLUMINATE disaster could have been predicted and prevented if just 9 proteins had been measured in clinical trial participants following initial treatments.

Alan Sandler (Roche via YouTube)

A top can­cer R&D ex­ec at Genen­tech joins the ex­o­dus, jump­ing to a mar­quee Chi­na biotech as the new on­col­o­gy chief, deal­mak­er

In the oncology world, there’s no better hunting ground for cancer R&D execs than Genentech. The biotech franchise at Roche has worked on some of the leading drugs in the field, proven themselves with blockbuster returns, and carries weight for whatever it says and does.

The exodus of R&D talent out of the South San Francisco hub is a testament to their success.

Now one of their top research execs has been raided by a top China biotech player to satisfy not just their need for an oncology R&D chief as they build up their muscle in discovery and drug development, but also add a spotter for new cancer drug deals.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 94,400+ biopharma pros reading Endpoints daily — and it's free.

Pfizer CEO Albert Bourla, BioNTech CEO Ugur Sahin

UP­DAT­ED: UK grants Pfiz­er, BioN­Tech his­toric first OK for mR­NA vac­cine, ex­pects mil­lions of dos­es by year end

Pfizer and BioNTech have scored a historic OK for their Covid-19 vaccine in the UK, where the first doses are expected to be delivered within days.

Days after the British government authorized its Medicines & Healthcare Products Regulatory Agency to make a call independent of the European Union — from which it’s in the process of exiting — the regulators gave the green light for emergency use of BNT162b2.

Long af­ter Mer­ck and Bris­tol My­ers cre­at­ed a multi­bil­lion-dol­lar mar­ket, the PD-1 lead­ers are once again duk­ing it out — this time over a $12B-plus pot

Six years after Merck and Bristol Myers Squibb captured the attention of the oncology world with the first approval of their PD-1 drugs Keytruda and Opdivo, sales revenue has started to level off after a host of rivals joined the hunt for new OKs for metastatic conditions, where the FDA has proven quick to act.

But a key analyst covering biopharma believes that there’s a vast, still largely untapped frontier for new approvals to come in the adjuvant setting that could once again ignite the growth of these leading cancer franchises. And once again, he’s pointing to the 2 leaders in the field as the most likely players to come out ahead — way, way ahead.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 94,400+ biopharma pros reading Endpoints daily — and it's free.

Wolfram Carius, EVP, pharmaceuticals product supply (Bayer)

UP­DAT­ED: Bay­er con­tin­ues its cell and gene ther­a­py push, en­velop­ing dif­fer­ent projects un­der one strate­gic roof while hunt­ing new deals

Roughly five weeks after buying out Asklepios — also known as AskBio — for up to $4 billion, Bayer is hammering home its focus on cell and gene therapies.

The Big Pharma announced Wednesday that it is establishing a cell and gene therapy platform within its pharmaceuticals division in order to consolidate all of its related projects under one umbrella. Researchers will continue working and developing experimental drugs on their own, Bayer said, while the execs will lay out and define the overall strategy and look to swing some more deals.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 94,400+ biopharma pros reading Endpoints daily — and it's free.

Jeremy Levin, Ovid CEO

For two years, Ovid spun a Phase II miss as a win. The drug just failed Phase III

Two years ago, Ovid’s lead program failed in Phase II. Or at least that’s what analysts said.

Jeremy Levin, the company’s CEO, argued investors misunderstood a study for a rare disease they were unfamiliar with, and that while the drug missed a bunch of measures, it hit on the one key endpoint Ovid was looking for. Investors said they struck the endpoint by dumb luck and would never reproduce the lone win in a larger study.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 94,400+ biopharma pros reading Endpoints daily — and it's free.

Cap­ping Pas­cal So­ri­ot’s big turn­around, the an­a­lysts at Cowen say As­traZeneca is poised for a stel­lar year

Big Pharmas typically don’t get a lot of respect for R&D efforts. Their ROI is bad on a massive annual bill, there’s too much late-stage failure, analysts fret about the endurance of big franchises and the impact of generic competition.

Even as Pascal Soriot is staunching the bleeding around a badly handled Phase III readout for their Covid-19 vaccine, though, the AstraZeneca CEO is taking a bow today as Cowen lavishes praise on the pipeline and near-term prospects for the multinational — for the second year in a row.

Endpoints Premium

Premium subscription required

Unlock this article along with other benefits by subscribing to one of our paid plans.

Mer­ck sells off its Mod­er­na stake af­ter mak­ing record gains amid the pan­dem­ic

After recording close to a billion dollars in investment earnings over 9 months, driven mostly by Moderna’s soaring stock, Merck is cashing out.

The company sold its stake in $MRNA — which it’s held since 2015 — in the first half of the quarter, causing a temporary 2.5% dip in Moderna’s share price before the market opened on Wednesday. By late morning, the stock was back up 3.4%. The news comes just two weeks before an FDA advisory committee meeting to discuss Moderna’s application for emergency use of its Covid-19 vaccine.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 94,400+ biopharma pros reading Endpoints daily — and it's free.

News brief­ing: Ex­elix­is pays $20M to in-li­cense a pre­clin­i­cal ADC for the pipeline; An­oth­er pre­clin­i­cal biotech shoots for a big IPO

Eighteen months after Exelixis signed on to partner with Iconic Therapeutics on an antibody-drug conjugate, more money is flowing.

Exelixis is picking up its exclusive option on the tissue factor-targeting ADC now known as XB002 (formerly ICON-2), Iconic’s lead program. Exelixis is adding $20 million to the $7.5 million it paid upfront. Part of that goes to ZymeWorks, which assisted with their ZymeLink ADC tech.