MiMedx shares dive following letter from FDA
MiMedx skids to annual low after company says FDA is concerned about regulatory violations
NEW YORK (AP) -- Shares of MiMedx Group tumbled Wednesday after the company received a letter from the Food and Drug Administration about regulatory violations.
MiMedx said the letter concerns the marketing of its Amnion and Chorion products. The company is being cited for violations that do not rise to the level of an official warning letter. MiMedx said it was surprised by the letter because an FDA inspection in 2012 did not turn up any problems, and it said it believes the FDA's concerns are based on a "misunderstanding."
MiMedx shares dropped $2.21, or 36.5 percent, to $3.85 on Wednesday. Earlier they reached an annual low of $1.81.
The Marietta, Ga., company develops biomaterials made from sterilized human amniotic membrane. Its AmnioFix products are designed to reduce scar tissue formation, reduce inflammation at surgical sites and improve healing.
The amniotic membrane is the innermost layer of the placenta and it lines the amniotic cavity during pregnancy.
The company also said it still expects to report $54 million to $60 million in revenue in 2013 and $90 million to $110 million in 2014. According to FactSet, analysts are forecasting $58.8 million in revenue in 2013 and $99.8 million in 2014.
