−Removed: MiMedx is an industry leader in utilizing birth tissue as a platform for regenerative medicine, developing and distributing placental tissue allografts with patent-protected, proprietary processes for multiple sectors of healthcare.
−Removed: As a pioneer in placental biologics, we have both a core business, focused on addressing the needs of patients with acute and chronic non-healing wounds, and a promising late-stage pipeline targeted at decreasing pain and improving function for patients with degenerative musculoskeletal conditions.
−Removed: We derive our products from human placental tissues and process these tissues using our proprietary processing methods, including the PURION® process.
−Removed: We employ Current Good Tissue Practices, Current Good Manufacturing Practices, and terminal sterilization to produce our allografts.
−Removed: MiMedx provides products primarily in the wound care, burn, surgical, and non-operative sports medicine sectors of healthcare.
−Removed: All of our products are regulated by the FDA.
+Added: MiMedx is a transformational placental biologics company, developing and distributing placental tissue allografts with patent-protected, proprietary processes for multiple sectors of healthcare.
+Added: As a pioneer in placental biologics, we are focused on addressing unmet clinical needs in the areas of advanced wound care, surgical recovery applications, and musculoskeletal conditions.
+Added: We derive our products from human placental tissues and process these tissues using our proprietary methods, including the PURION® process.
+Added: We employ Current Good Tissue Practices (“ CGTP ”), Current Good Manufacturing Practices (“ CGMP ”), and terminal sterilization to produce our allografts.
+Added: MiMedx provides products primarily for use in the wound care, burn, and surgical recovery sectors of healthcare.
+Added: All of our products are regulated by the U.S.
+Added: Food & Drug Administration (“ FDA” ).
At MiMedx, our vision is to advance regenerative science and innovative biologics that restore quality of life.
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Character, Customer Orientation, Innovation, Collaboration and Stewardship are our core values.
−Removed: MiMedx is a leading supplier of human placental allografts, which are human tissues that are derived from one person (the donor) and used to produce therapies to treat another person (the recipient).
+Added: MiMedx is a leading supplier of human placental allografts, which are human tissues that are derived from one person (the donor) and used to produce products that treat another person (the recipient).
MiMedx has supplied over two million allografts, through both direct and consignment shipments.
−Removed: Our platform technologies include AmnioFix®, EpiFix®, EpiCord®, AmnioCord® and AmnioFill®.
+Added: Our primary platform technologies include EPIFIX®, AMNIOFIX®, EPICORD®, and AMNIOCORD®.
AMNIOFIX and EPIFIX are our tissue allografts derived from the amnion and chorion layers of the human placental membrane.
EPICORD and AMNIOCORD are tissue allografts derived from umbilical cord tissue.
−Removed: AmnioFill is a particulate product comprised of placental connective tissue matrix, derived from the placental disc and placental membranes.
−Removed: Our EpiFix and EpiCord sheet product lines are promoted for external use, such as in advanced wound care applications, while our AmnioFix, AmnioCord and AmnioFill products are positioned for surgical applications, including lower extremity repair, plastic surgery, vascular surgery and multiple orthopedic repairs and reconstructions.
+Added: Our EPIFIX and EPICORD products are marketed for external use, such as in advanced wound care applications, while our AMNIOFIX and AMNIOCORD products are positioned for use in surgical recovery applications, including lower extremity repair, plastic surgery, vascular surgery and multiple orthopedic repairs and reconstructions.
We describe these in greater detail below under the heading “ Our Product Portfolio.
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The Guidance established an updated framework for the FDA’s regulation of cellular and tissue-based products.
−Removed: Among other things, the guidances clarified the FDA’s views about the criteria that differentiate those products subject to regulation solely under Section 361 (“ Section 361 HCT/Ps ”) from those cellular and tissue-based products considered to be drugs, devices, and/or biological products (“ Section 351 HCT/Ps ”) subject to licensure under Section 351 of the Public Health Service Act (“ Section 351 ”) and related regulations.
−Removed: Effect on Our Products.
−Removed: Under the Guidance, we expect that the FDA will continue to regulate our amniotic membrane sheet products (AmnioFix, EpiFix, EpiBurn and EpiXL) as Section 361 HCT/Ps so long as the claims we make for them are consistent with the Section 361 framework.
−Removed: We expect, however, that the FDA will regulate certain of our other products, such as our micronized products (AmnioFix Injectable and EpiFix Micronized) as Section 351 HCT/Ps.
−Removed: We also expect other products, like AmnioFill, to be regulated under Section 351.
+Added: Among other things, the Guidance clarified the FDA’s views about the criteria that differentiate those products subject to regulation solely under Section 361 (“ Section 361 HCT/Ps ”) from those cellular and tissue-based products considered to be drugs, devices, and/or biological products (“ Section 351 HCT/Ps ”) subject to licensure under Section 351 of the Public Health Service Act (“ Section 351 ”) and related regulations.
+Added: Effect of Guidance on Our Products.
+Added: Under the Guidance, we expect that the FDA will continue to regulate certain of our placental tissue products (EPIFIX, AMNIOFIX, EPICORD, AMNIOCORD and AMNIOBURN) as Section 361 HCT/Ps so long as the claims we make for them are consistent with the Section 361 framework.
+Added: However, the FDA is now regulating certain of our other products, such as our micronized products (AMNIOFIX Injectable and EPIFIX Micronized, collectively “ mdHACM ” or “ micronized dehydrated human amnion chorion membrane ”) and our particulate product (AMNIOFILL), as Section 351 HCT/Ps and/or medical devices.
Enforcement Discretion .
−Removed: The Guidance stated that the FDA intends to exercise enforcement discretion under limited conditions with respect to the Investigative New Drug (“ IND ”) application and pre-market approval requirements for certain HCT/Ps through November 2020.
−Removed: However, in July 2020, the FDA extended its period of enforcement discretion to May 31, 2021.
−Removed: In doing so, the FDA stated, “This will give manufacturers additional time to determine if they need to submit an investigational new drug (IND) or marketing application and, if such an application is needed, to prepare the IND or marketing application.
−Removed: Such additional time is warranted in light of COVID-19, which has presented unique challenges in recruiting clinical trial participants and carrying out clinical trials.”
−Removed: We believe this to mean that, through May 31, 2021, the FDA does not intend to enforce certain provisions as they currently apply to certain entities or activities.
−Removed: The FDA has stated that this period of enforcement discretion is intended to give sponsors
−Removed: time to evaluate their products, have a dialogue with the agency and, if necessary, begin clinical trials and file the appropriate pre-market applications to transition products that had been marketed as Section 361 HCT/Ps into compliance with Section 351.
−Removed: The FDA’s approach is risk-based, and the Guidance clarified that high-risk products and uses might be subject to immediate enforcement action.
−Removed: During the Period of Enforcement Discretion .
−Removed: We have continued to market our micronized products (AmnioFix Injectable and EpiFix Micronized) and our particulate product (AmnioFill) under this policy of enforcement discretion, while at the same time pursuing Biologics License Applications (“ BLAs ”) for certain of our micronized products.
−Removed: We have already filed INDs for three indications for our micronized product, AmnioFix Injectable:
−Removed: plantar fasciitis, knee osteoarthritis, and Achilles tendonitis, and have been conducting clinical trials.
−Removed: We also intend to file the appropriate investigative application for both AmnioFill and for EpiFix Micronized, as well as an additional IND for AmnioFix Injectable in the first half of 2021;
−Removed: we are currently in the clinical trial design and planning stage, but have not yet initiated any clinical trials in furtherance of any additional regulatory approvals for these products.
−Removed: Efforts to Seek Extension of Enforcement Discretion Period.
−Removed: MiMedx is actively engaging with the FDA to extend its enforcement discretion period beyond May 2021 to allow for the continued marketing of the potentially affected products in accordance with an agreed upon transition plan.
−Removed: However, there is no guarantee that the FDA will grant an extension, and even if issued, such an extension may be limited to the products, doses, and indications that are subject to clinical trials.
−Removed: See discussion below - “ Risk Factors ” under the heading “ To the extent our products do not qualify for regulation as human cells, tissues and cellular and tissue-based products solely under Section 361 of the Public Health Service Act, this could result in removal of the applicable products from the market, would make the introduction of some new tissue products more expensive, and could significantly delay the expansion of our tissue product offerings and subject us to additional post-market regulatory requirements.”
−Removed: Post-Enforcement Discretion.
−Removed: Following the period of enforcement discretion, we may need to cease selling our micronized products and other products regulated under Section 351 until the FDA grants pre-market approval, and then we will only be able to market such products for indications that have been cleared or approved by the FDA.
−Removed: The loss of our ability to market and sell our micronized products would have a material adverse impact on our revenues, earnings and financial position.
−Removed: In 2020, revenues from all micronized products and AmnioFill were $32.8 million, or approximately 13% of our total revenue.
−Removed: Similarly, if the FDA determines that our umbilical cord products, EpiCord, EpiCord Expandable, and AmnioCord, do not meet the requirements for regulation solely under Section 361, then the products will be regulated under Section 351 and pre-market clearance or approval will be required.
−Removed: In 2020, revenues from umbilical cord-derived products was $16.6 million.
−Removed: See discussion below – “ Risk Factors ” under the heading “ To the extent our products do not qualify for regulation as human cells, tissues and cellular and tissue-based products solely under Section 361 of the Public Health Service Act, this could result in removal of the applicable products from the market, would make the introduction of some new tissue products more expensive, and could significantly delay the expansion of our tissue product offerings and subject us to additional post-market regulatory requirements.”
−Removed: Most of our revenues are generated by wound care applications.
−Removed: We have focused our priorities on initiatives across our Commercial, Operations and Research & Development organizations that position us to exceed 10% year-over-year adjusted net sales growth in our core business, and enhance the probability of success for our late-stage pipeline.
−Removed: In the first half of 2021, we plan to continue executing our commercial strategy, complete the conversion of our manufacturing and quality systems toward compliance with the CGMP requirements that apply to Section 351 products, and continue to maintain a dialogue with the FDA in advance of the end of the period of enforcement discretion.
−Removed: We are advancing our therapeutic biologics pipeline to achieve FDA approvals for specific clinical indications, including areas of musculoskeletal degeneration and other areas of unmet clinical need.
−Removed: See the discussion below – “Clinical Trials” for more information.
+Added: Under the Guidance, the FDA exercised enforcement discretion under limited conditions with respect to the Investigational New Drug (“ IND ”) application and pre-market approval requirements for certain HCT/Ps through May 31, 2021.
+Added: We continued to market our micronized products (mdHACM) and our particulate product (AMNIOFILL) under this policy of enforcement discretion in the United States until May 31, 2021, while at the same time pursuing Biologics License Applications (“ BLAs ” ) for certain of our micronized products in specific clinical applications.
+Added: After May 31, 2021, we no longer sell our micronized and particulate products in the United States, and do not intend to sell such products in the United States until the FDA grants pre-market approval.
+Added: As a result, we will only be able to market such products for indications that have been cleared or approved by the FDA.
+Added: Similarly, we are engaged with the FDA regarding the classification of our umbilical cord products, EPICORD, EPICORD Expandable, and AMNIOCORD, which are tissue allografts derived from the structural, protective covering and extracellular matrix cushioning layers of the umbilical cord.
+Added: If the FDA makes a final determination that our umbilical cord-derived products do not meet the requirements for regulation solely under Section 361, then the products will require additional pre-market clearance or approval.
+Added: In 2021, revenues from US sales of our umbilical cord-derived products were $23.6 million.
+Added: See discussion below – “ Risk Factors ” under the heading “ Certain of our products do not qualify for regulation as human cells, tissues and cellular and tissue-based products solely under Section 361 of the Public Health Service Act, which has resulted in removal of the applicable products from the market, made the introduction of
+Added: some new tissue products more expensive, significantly delayed the expansion of our tissue product offerings and subjected us to additional post-market regulatory requirements.
+Added: Additional regulatory requirements may be imposed in the future.”
Our current business began on February 8, 2008 when Alynx, Co., our predecessor company, acquired MiMedx, Inc., a development-stage medical device company, the assets of which included licenses to two development-stage medical device technology platforms which we do not currently market.
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In January 2011, we acquired all of the outstanding equity interests of Surgical Biologics, LLC (n/k/a MiMedx Tissue Services, LLC).
−Removed: Recent Developments
−Removed: SEC Matters and Corporate Matters
−Removed: On March 17, 2020, we filed our annual report for the year ended December 31, 2018 which included restated financial statements.
−Removed: On July 6, 2020, we filed our annual report for the year ended December 31, 2019, three quarterly reports for 2019, and our quarterly report for the period ended March 31, 2020.
−Removed: By doing so, we became current in our periodic reporting obligations with the SEC.
−Removed: We also held our 2019 annual meeting of shareholders on August 31, 2020 and our 2020 annual meeting of shareholders on November 20, 2020.
−Removed: Relisting of Common Stock and Related Matters
−Removed: On November 4, 2020, The Nasdaq Stock Market LLC (“ Nasdaq ”) relisted our common stock (“ Common Stock ”).
−Removed: Previously, Nasdaq had suspended our Common Stock from trading on November 8, 2018 and subsequently delisted our Common Stock effective March 8, 2019 due to our failure to remain current in our SEC reporting obligations.
−Removed: Additions to our Management and Board of Directors
−Removed: Since June 2018, most of our executive leadership team has changed.
−Removed: • The Board appointed Timothy R.
−Removed: Wright as Chief Executive Officer, effective as of May 13, 2019.
−Removed: • On December 2, 2019, William “Butch” Hulse IV joined the Company as General Counsel and Secretary.
−Removed: • Effective March 18, 2020, the Board appointed Peter M.
−Removed: Carlson as Chief Financial Officer.
−Removed: • On May 1, 2020 the Board appointed William L.
−Removed: Phelan as Chief Accounting Officer.
−Removed: • On July 28, 2020, the Board appointed Rohit Kashyap, Ph.D.
−Removed: Executive Vice President and Chief Commercial Officer.
−Removed: • On August 10, 2020, the Board appointed Robert B.
−Removed: Stein, M.D., Ph.D.
−Removed: Executive Vice President, Research and Development.
−Removed: In addition, we welcomed four new directors to our Board of Directors in 2020.
−Removed: Pursuant to the Preferred Stock Transaction described below, we increased the size of our Board of Directors, and Martin P.
−Removed: Sutter and William A.
−Removed: Hawkins III were appointed to serve as Preferred Directors effective July 2, 2020.
−Removed: At the 2020 Annual Meeting held on November 20, 2020, shareholders elected Dr.
−Removed: Michael Giuliani and Dr.
−Removed: Cato Laurencin to the Board.
−Removed: Phyllis Gardner will join the Board effective immediately following the filing of this report.
−Removed: As a result, all of our current directors have joined the Board as new members since May 2019.
−Removed: Financing Transactions
−Removed: On July 2, 2020, we issued shares of our Series B Convertible Preferred Stock, par value $0.001 per share (the “ Series B Preferred Stock ”), to an affiliate of EW Healthcare Partners and to certain funds managed by Hayfin Capital Management LLP pursuant to the Securities Purchase Agreement, dated as of June 30, 2020 (the “ Securities Purchase Agreement ”), for an aggregate purchase price of $100 million (the “ Preferred Stock Transaction ”).
−Removed: On July 2, 2020, we also borrowed an aggregate of $50 million pursuant to the loan agreement, dated as of June 30, 2020 (the “ Hayfin Loan Agreement ”), by and among the MiMedx Group, Inc., certain of our subsidiaries, Hayfin Services LLP and other funds managed by Hayfin Capital Management LLP, and obtained an additional committed but undrawn $25 million facility pursuant to the Hayfin Loan Agreement (collectively, the “ Hayfin Loan Transaction ”).
−Removed: A significant portion of the proceeds from these transactions was used to repay the outstanding balance of principal and accrued but unpaid interest, and prepayment premium, under existing indebtedness.
−Removed: For further information regarding the Preferred Stock Transaction, see Item 8, Note 10 “ Equity .” For further information regarding the Hayfin Loan Agreement and the repayment of our prior indebtedness, see Item 8, Note 8 “ Long-Term Debt.
−Removed: Government Investigations and Litigation
−Removed: On April 6, 2020, we announced that we had finalized a settlement with the Department of Justice (the “ DOJ ”), resolving an investigation concerning the accuracy of commercial pricing disclosures to the United States Department of Veterans Affairs (the “ VA ”) for one of our products in connection with our Federal Supply Schedule contract, and a related qui tam action filed in Minnesota.
−Removed: We self-disclosed the matter to the VA Office of Inspector General (VA-OIG) in November 2018, prior to our knowledge of the qui tam suit or any underlying government investigation and, as the DOJ acknowledged in the settlement agreement, we cooperated with the government’s investigation into the matter.
−Removed: Without admitting the allegations, we agreed to
−Removed: pay $6.5 million to the DOJ to resolve the matter.
−Removed: Previously, we disclosed that we had accrued an amount to cover the settlement and anticipated related expenses in our annual report on Form 10-K for the year ended December 31, 2018.
−Removed: On January 11, 2021, we provided an update regarding the United States Attorney’s Office for the Southern District of New York (“ USAO-SDNY ”) Investigation into, among other things, our recognition of revenue and practices with certain distributors and customers.
−Removed: The USAO-SDNY recently advised us, based on the USAO-SDNY’s current understanding of facts, that it does not intend to pursue further action or remedies against us.
−Removed: On September 9, 2020, we reached a settlement of three shareholder derivative actions ( Evans v.
−Removed: Petit, et al.
−Removed: filed September 25, 2018, Georgalas v.
−Removed: Petit, et al.
−Removed: filed September 27, 2018, and Roloson v.
−Removed: Petit, et al.
−Removed: filed October 22, 2018) that had been filed in the Northern District of Georgia.
−Removed: On December 21, 2020, the Court approved the settlement.
−Removed: Pursuant to the Florida Business Corporation Act and indemnification agreements with its former Chairman and CEO, Parker H.
−Removed: “Pete” Petit, and former COO, William Taylor, the Company has advanced defense costs to Petit and Taylor in connection with certain legal proceedings arising from their corporate status as former directors and officers of the Company.
−Removed: Following the jury verdict against Petit for securities fraud and Taylor for conspiracy to commit securities fraud, on January 12, 2021, the Company filed suit in the Eleventh Judicial Circuit of Florida in and for Miami-Dade County ( MiMedx Group, Inc.
−Removed: Petit and Taylor ) seeking (1) a declaratory judgment that a conviction of Petit and Taylor means the Company has no further obligation to indemnify or advance expenses to them, (2) reimbursement of amounts previously advanced to Petit and Taylor, and (3) any other relief deemed just and proper by the court.
−Removed: Given the inherent difficulty of predicting the outcome of litigation, the Company cannot estimate recoveries, ranges of recoveries, losses or ranges of losses in these proceedings, nor can it predict whether it may be required to continue to indemnify or advance defense costs to Petit and Taylor.
−Removed: For more information see the discussion included in Item 8 -- Note 14, “Commitments and Contingencies.”
Current Business Priorities and Strategy
−Removed: As a pioneer in placental biologics, we have both a core business, focused on addressing the needs of patients with acute and chronic non-healing wounds, and a promising late-stage pipeline of products to decrease pain and improve function in patients with degenerative musculoskeletal conditions.
−Removed: Within the advanced wound care sector, there is significant unmet patient need, due to an aging population, an increasing incidence of obesity and diabetes, and other contributing comorbidities that result in a higher susceptibility to non-healing chronic wounds.
−Removed: These demographics extend into the musculoskeletal sector as well, and the increasing number of patients requiring advanced treatment represents a significant cost burden on the healthcare system.
−Removed: By incorporating a strategy to advance the underlying placental science and more rigorously establish the clinical and economic effectiveness of our products, we believe the Company can differentiate the value of our portfolio and address multiple areas of significant unmet clinical need.
−Removed: We have focused our priorities on initiatives across our Commercial, Operations and Research & Development organizations that position the Company to exceed 10% growth in our core business, and enhance the probability of success for our late-stage pipeline.
−Removed: Within our core business, the Company’s focus is on demonstrating the value of our existing portfolio, increasing the effectiveness and efficiency of our sales force using intensive analytics, and deploying clinical support and economic data to educate healthcare professionals on the efficacy of our products.
−Removed: In early 2021, we completed a redesign of our sales force, intended to structure personnel and territories to capitalize on new opportunities, drive efficiencies, and reward long-term territory growth through adjustments in our sales compensation structure.
−Removed: Over the course of the year, we plan to increase the number of sales personnel by approximately 10%, and to increase the number of Medical Science Liaisons to further support medical education initiatives.
−Removed: Initiatives designed to expand the market include increasing disease state awareness, improving patient understanding of available treatment options, and leveraging recent reimbursement coverage and the Company’s favorable mention in a February 2020 Agency for Healthcare Research and Quality (AHRQ) report.
−Removed: The Company is also focused on advancing our late-stage pipeline and accelerating efforts toward seeking FDA approval for AmnioFix Injectable, also designated as micronized dehydrated human amnion/chorion membrane (“ mdHACM ”), to treat musculoskeletal degeneration across multiple indications.
−Removed: As a significant area of focus and investment for MiMedx, we are progressing clinical, manufacturing, and quality initiatives, in support of mdHACM as a biologic with broad potential across a range of large and growing clinical indications.
−Removed: We are aligning voice-of-customer input, market intelligence, industry expertise and additional resources as inputs to our commercialization strategy for these products.
−Removed: In parallel, we are continuing to proactively communicate with the FDA.
−Removed: We are preparing to request and schedule End-of-Phase meetings with the FDA to review our progress with ongoing clinical trials, and outline the proposed next steps, including plans to accelerate a Phase 3 clinical trial for knee osteoarthritis.
−Removed: The timing for this meeting will be dependent upon FDA feedback and availability.
−Removed: Our planned investments in Research and Development throughout 2021 are designed to advance our late-stage pipeline and support our core market growth objectives.
−Removed: We intend to publish additional peer-reviewed clinical, scientific and economic data that further reinforce the differentiation of our products and expand the utility of the Company’s placentally-derived products in other clinical applications throughout the care continuum.
−Removed: In addition, we are enhancing business and product development efforts, targeting new applications and potential products that fit within our framework of innovative technologies backed by rigorous science, that elevate the standard of care.
+Added: As a pioneer in placental biologics, we are focused on addressing the needs of patients with acute and chronic non-healing wounds in the areas of advanced wound care and surgical recovery.
+Added: We have a promising late-stage pipeline platform aimed at decreasing pain and improving function in patients with degenerative musculoskeletal conditions.
+Added: There is significant unmet patient need due to an aging population, an increasing incidence of obesity and diabetes, and other contributing comorbidities that result in a higher susceptibility to non-healing across each of these therapeutic areas.
+Added: An increasing number of patients require advanced treatment, which represents a significant cost burden on the healthcare system.
+Added: By incorporating a strategy to advance the scientific and therapeutic potential of placental tissue and more rigorously establish the clinical and economic effectiveness of our products, we believe the Company can differentiate the value of our portfolio and address multiple areas of significant unmet clinical need.
+Added: We have focused our priorities on initiatives across our Commercial, Operations and Research & Development organizations that position the Company to achieve its goal of sustainable double digit annual percentage growth in our business and advance our late-stage musculoskeletal pipeline.
+Added: We believe there are a number of large, underpenetrated market opportunities in the areas of advanced wound care and surgical recovery, including across multiple international markets.
+Added: We anticipate receiving reimbursement approval in Japan in mid-2022, and plan to launch EPIFIX in Japan as the first amniotic tissue approved for wound treatment across a broad range of conditions.
+Added: Domestically, we are expanding our addressable markets from the treatment of diabetic foot ulcers, venous leg ulcers, pressure ulcers and complex wounds into areas of surgical recovery where the use of our tissue products could help reduce complications across several specialties, including plastic surgery, general surgery, gynecology, urology, orthopedics, spinal surgery, lower extremity repair and sports medicine procedures.
+Added: After studying the landscape of surgical procedures, we are targeting certain procedures based on potential complication rate, clinical relevance, economic factors and business priorities.
+Added: We have a robust pipeline of organic products in development, and have a goal of improving the Company’s Product Vitality Index by launching two new organic products per year, beginning with AMNIOEFFECT™ and our Placental Collagen Matrix (“ PCM ”) product in 2022.
+Added: We believe we have a sustainable competitive advantage with our customer focused ecosystem, consisting of a leading portfolio of products, proprietary technology, and best-in-class sales and support organization, together with our broad access and coverage, robust clinical support and medical education efforts, and record of proven outcomes focused on improving patient care.
+Added: The Company is also pursuing FDA approval for mdHACM as a platform technology to treat musculoskeletal degeneration across multiple indications, beginning with knee osteoarthritis (“ KOA ”).
+Added: In late 2021, we reviewed the results of our Phase 2B KOA clinical trial, which did not meet its primary endpoints, but did yield significant outcomes from the “Pre-Interim Analysis Cohort” consisting of 190 patients.
+Added: The 190 subjects enrolled prior to an interim analysis performed for sample size correction in July through August 2019 showed a statistically significant and clinically meaningful difference in favor of mdHACM in Western Ontario and McMaster Universities Arthritis Index (“ WOMAC ”) total scores, and in each of the pain and function subscales compared to the placebo.
+Added: However, subjects enrolled after this interim analysis did not show separation from the placebo.
+Added: Root-cause analysis determined that the potency of the investigational product faded as it aged, resulting in the study’s failure to meet its primary endpoints.
+Added: Based on the data from the Pre-Interim Analysis Cohort in the Phase 2B trial, published retrospective data, extensive real-world clinical use, and ongoing scientific mechanism of action research, the Company expects to initiate a Phase 3 KOA program in 2022, with a BLA filing anticipated in late 2025, and will work closely with the FDA in advancing this program.
Our Product Portfolio
−Removed: We sell our placenta-based allograft products under our own brands and, on a limited basis, through a private label or original equipment manufacturer (“ OEM ”) basis.
+Added: We sell our placenta-based allograft products under our own brands and, on a limited basis, through a private label or original equipment manufacturer (“ OEM ”).
We maintain strict controls on quality at each step of the manufacturing process beginning at the time of procurement.
−Removed: Our Quality Management System has long been focused on compliance with the American Association of Tissue Banks’ (“ AATB ”) standards and the FDA’s current Good Tissue Practices (“ CGTP ”), and we are strengthening our controls for future BLA products through the implementation of our current Good Manufacturing Practices (“ CGMP ”) program.
−Removed: We believe the implementation of CGMP will provide benefits throughout our entire product portfolio, and add to our competitive differentiation.
−Removed: Our EpiFix allograft is a semi-permeable protective barrier membrane product comprised of dehydrated human amnion/chorion membrane that may be used in the treatment of chronic wounds, including diabetic foot ulcers (“ DFUs ”), venous leg ulcers (“ VLUs ”), pressure ulcers and burns.
−Removed: EpiFix is available in a variety of sizes that can be used appropriately for wounds of varying sizes.
−Removed: MiMedx also has a micronized version of this product.
+Added: Our Quality Management System is focused on compliance with the American Association of Tissue Banks’ (“ AATB ”) standards and the FDA’s CGTP, and we are implementing CGMP.
+Added: We believe the application of CGMP will provide benefits throughout our entire product portfolio, and add to our competitive differentiation.
+Added: EPIFIX is a semi-permeable, protective barrier allograft comprised of dehydrated human amnion/chorion membrane that may be used in the treatment of chronic wounds, including diabetic foot ulcers (“ DFUs ”), venous leg ulcers (“ VLUs ”), and pressure ulcers.
+Added: EPIFIX is available in an assortment of sheet configurations and sizes to accommodate various wounds.
+Added: MiMedx also has a micronized version of this product that it no longer markets or sells in the United States.
As further discussed below under the heading “ Government Regulation - Recent FDA Guidance and Transition Policy for HCT/Ps ,” the FDA clarified in its 2017 guidance that it regards micronized placental membrane products as subject to FDA licensure as biological products under Section 351.
−Removed: We intend to file the appropriate investigative application with the FDA for EpiFix Micronized in the first half of 2021 for potential application in DFUs or other areas of advanced wound care, and are currently in the clinical trial design and planning stage, but have not yet initiated any clinical trials in furtherance of any regulatory approvals.
−Removed: Our AmnioFix allograft is a semi-permeable protective barrier membrane product comprised of dehydrated human amnion/chorion membrane that may be used in the treatment of wounds related to surgical procedures.
−Removed: AmnioFix is configured in a variety of sizes for internal use.
−Removed: Currently, we offer AmnioFix as sheet products in a range of sizes and in a micronized format as AmnioFix Injectable.
−Removed: • AmnioFix sheet form is used in a variety of surgical wound repair and internal surgical procedures.
−Removed: It is primarily used in lower extremity repair, spine, orthopedic, sports medicine, gastrointestinal, urologic, and other general surgery applications.
−Removed: • AmnioFix Injectable is supplied in micronized powder form and is reconstituted with 0.9% sterile saline for injection.
+Added: AMNIOFIX is a semi-permeable, protective barrier allograft comprised of dehydrated human amnion/chorion membrane that may be used in surgical recovery applications.
+Added: AMNIOFIX is available in an assortment of sheet configurations and sizes for internal use, including in the areas of lower extremity repair, spine, orthopedic, sports medicine, gastrointestinal, urologic, and other general surgery applications.
+Added: mdHACM is a micronized form of AMNIOFIX, and supplied in powder form, reconstituted with 0.9% sterile saline for injection.
This product is our lead BLA candidate.
−Removed: We are studying the product’s potential to address musculoskeletal degeneration across multiple indications.
−Removed: We have three on-going late-stage randomized controlled studies under open INDs, evaluating AmnioFix Injectable in plantar fasciitis, Achilles tendonitis and knee osteoarthritis.
−Removed: We currently are in Phase 3 for plantar fasciitis and Achilles tendonitis and in Phase 2B for knee osteoarthritis.
+Added: We completed three late-stage randomized controlled studies under open INDs, evaluating mdHACM in plantar fasciitis, Achilles tendonitis and knee osteoarthritis.
+Added: While the trials did not meet their primary endpoints, we intend to initiate our Phase 3 clinical trial program for knee osteoarthritis in 2022.
+Added: For further details, see “-- Clinical Trials .”
+Added: AMNIOBURN is a semi-permeable, protective barrier allograft comprised of dehydrated human amnion/chorion membrane that may be used in the treatment of partial-thickness and full-thickness burns.
EPICORD and AMNIOCORD
−Removed: EpiCord and AmnioCord are dehydrated human umbilical cord allografts intended for homologous use.
−Removed: EpiCord and AmnioCord provide a protective environment for the healing process and are used in the treatment of wounds or in surgical procedures.
−Removed: Our cord products are thicker than the EpiFix or AmnioFix allografts and have application in deeper wounds or in areas where suturing the allograft in place may be advantageous.
−Removed: In September 2020, we launched EpiCord Expandable as the latest advancement in our product portfolio.
−Removed: EpiCord Expandable is the first and only expandable allograft derived from the umbilical cord.
−Removed: The allograft can expand to twice its size, conforming to uneven surfaces and deep wounds, and is thick enough to allow for suturing as needed to keep the graft in place.
−Removed: This new placental tissue allograft provides healthcare professionals an additional option to support the advanced wound care needs of
−Removed: their patients with larger, chronic, and hard-to-heal wounds.
−Removed: As the wound progresses toward closure, a healthcare professional can transition to other products in our portfolio, including EpiCord or EpiFix as needed for additional sizes that can be used appropriately to best accommodate the size of the wound.
−Removed: AmnioFill consists of particles of connective tissue matrix derived from placental disc and placental membranes, and is used to replace or supplement damaged integumental tissue.
−Removed: Its primary application is in larger and uneven wound surfaces, or deep/tunneling wounds including pressure ulcers.
−Removed: Similar to our other micronized products, we are transitioning AmnioFill to recognize its regulation under Section 351, per FDA’s 2017 guidance on HCT/Ps, and are working towards pre-market approval.
−Removed: We are currently in the clinical trial design and planning stage but have not yet initiated any clinical trials in furtherance of any regulatory approvals for AmnioFill.
+Added: EPICORD and AMNIOCORD are dehydrated human umbilical cord allografts that may be used to provide a protective environment for the healing process and are used in the areas of advanced wound care and surgical recovery.
+Added: These products are thicker than our amniotic membrane allografts and can be applied in deeper wounds or in areas where suturing the allograft in place may be advantageous.
+Added: EPICORD Expandable is an allograft derived from the umbilical cord, and can expand to twice its size, conforming to uneven surfaces and deep wounds.
+Added: The thickness of the product allows for suturing as needed to keep the graft in place, and it provides healthcare professionals a new option to support the advanced wound care needs of their patients with larger, chronic, and hard-to-heal wounds.
+Added: The Company ceased marketing and selling AMNIOFILL in the United States in May 2021, following the end of the FDA’s period of enforcement discretion.
+Added: We have not yet initiated any clinical trials in furtherance of any regulatory approvals for this product.
We sell a selection of allografts on an OEM basis pursuant to an agreement under which we have granted a third party an exclusive license to some of our technology for use in dental applications.
−Removed: Other than dental applications, we have only a small number of OEM relationships.
−Removed: We continue to research new opportunities for amniotic and other placental tissue, and we have several additional offerings in various stages of conceptualization and development.
+Added: We continue to research new opportunities for amniotic and other placental tissue, and we have additional offerings in various stages of conceptualization and development.
Placenta Donation Program
We partner with physicians and hospitals to recover donated placental tissue.
−Removed: Through our donor program, a mother who delivers a healthy baby via a scheduled Caesarean section can donate her placenta and umbilical cord tissue in lieu of having it discarded as medical waste.
−Removed: After consent for donation is obtained, a blood sample from each donor is tested for communicable diseases, and the donor is screened for risk factors in order to determine eligibility in compliance with federal regulations and AATB standards.
+Added: Through our donor program, a mother who delivers a healthy baby via Caesarean section can donate her placenta and umbilical cord tissue in lieu of having it discarded as medical waste.
+Added: After consent for donation is obtained, a blood sample from each donor is tested for communicable diseases, and
+Added: the donor is screened for risk factors in order to determine eligibility in compliance with federal regulations and AATB standards.
We operate a licensed tissue bank that is registered as a tissue establishment with the FDA, and we are an accredited member of the AATB.
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We have developed a large, geographically diverse, network of hospitals that participate in our placenta donation program, and we employ a dedicated staff that work with these hospitals.
−Removed: We also utilize third-party providers of placenta donations on an as-needed basis to mitigate business risk.
−Removed: We believe that we will be able to obtain an adequate supply of tissue to meet anticipated demand.
+Added: We also utilize a third-party provider of placenta donations on an as- needed basis to mitigate business risk.
+Added: We believe that we will be able to obtain an adequate supply of tissue to meet anticipated demand for the foreseeable future.
However, see discussion below “Risk Factors” under the heading “ Our products depend on the availability of tissue from human donors, and any disruption in supply could adversely affect our business.
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This technique specifically focuses on preserving the tissue’s natural growth factor content and regulatory proteins, and maintaining the structure and collagen matrix of the tissue.
−Removed: Our patented and proprietary processing method employs aseptic processing techniques in addition to terminal sterilization for increased patient safety.
−Removed: Despite starting with similar placental tissues, all placental tissue products and processes are not the same – we believe that our proprietary process preserves more of the natural beneficial characteristics of the tissue than the processes used by many of our competitors.
−Removed: The PURION process produces an allograft that retains the tissue’s inherent biological properties (cytokines, chemokines, growth factors, etc.
−Removed: ) found in the placental tissue and produces an allograft that is safe and easy for healthcare providers to use.
+Added: Our patented and proprietary processing method employs aseptic processing techniques in addition to terminal sterilization for increased product safety.
+Added: Despite starting with similar placental tissues, all placental tissue products and processes are not the same – we believe that our proprietary tissue engineering process preserves more of the natural beneficial characteristics of the tissue than the processes used by many of our competitors.
+Added: The PURION process produces an allograft that retains the tissue’s inherent biological properties and regulatory proteins (including cytokines, chemokines, and growth factors) found in the placental tissue and produces an allograft that is safe and easy for healthcare providers to use.
The allograft can be stored at room temperature and has a five-year shelf life.
Each sheet allograft incorporates specialized visual embossments that assist the health care practitioner with allograft placement and orientation.
−Removed: To ensure the safety of human tissue products, the FDA enforces current Good Tissue Practice (“ CGTP ”) manufacturing regulations.
+Added: To ensure the safety of human tissue products, the FDA enforces CGTP manufacturing regulations.
We believe that MiMedx has developed mature systems to comply with, and is in compliance with, these regulations.
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We are registered with the FDA as a tissue establishment and are subject to the FDA’s CGTP quality program regulations, state regulations and regulations promulgated by various regulatory authorities outside the United States.
−Removed: The Company’s most recent FDA inspection for compliance with CGTP regulations, which took place in September 2018, resulted in no observations and a no action indicated (NAI) rating, which is the most favorable designation the FDA provides after an inspection.
−Removed: In recent years, the FDA has clarified through inspection activity, letters to industry, and guidance documents its expectation that certain human tissue products, including product types manufactured by MiMedx, meet additional requirements that apply to traditional biological products, such as BLA approval and CGMP compliance beginning in May 2021.
−Removed: The guidance documents apply to products offered by many companies, not just MiMedx, and the guidance has implications for manufacturing processes, among other things.
−Removed: For example, the FDA generally requires products subject to Section 351 to be manufactured in compliance with CGMPs.
−Removed: After the end of the enforcement discretion period, these products will be subject to CGMP compliance.
−Removed: The Company is developing and enhancing systems to meet these requirements, and intends to complete those efforts by May 2021, although there is no guarantee that the Company will be able to meet the requirements by such date, or at all.
+Added: The Company’s September 2018 FDA inspection for compliance with CGTP regulations resulted in no observations and a no action indicated (“ NAI ”) rating, which is the most favorable designation the FDA provides after an inspection.
In December 2019, the FDA conducted CGMP inspections at our Marietta, Georgia, and Kennesaw, Georgia, processing facilities.
The FDA issued a Form FDA 483 (“ 483 ”), which is a list of inspectional observations, at the conclusion of each inspection.
−Removed: Specifically, the FDA issued a 483 consisting of 9 observations at our Marietta, Georgia processing facility, and a 483 consisting of 14 observations at our Kennesaw, Georgia processing facility.
+Added: Specifically, the FDA issued a 483 consisting of nine observations at our Marietta, Georgia processing facility, and a 483 consisting of 14 observations at our Kennesaw, Georgia processing facility.
MiMedx timely responded to the FDA regarding each observation, providing substantive responses to all of the observations.
−Removed: The Company’s response included completed and planned actions to address each observation, and as of the date of this filing, all of these remedial actions are now complet e.
−Removed: In January 2021, the FDA classified its December 2019 inspection of our Kennesaw, Georgia facility as “VAI,” or voluntary action indicated, which means objectionable conditions or practices were found in their December 2019 inspection but the agency is not taking or recommending any administrative or regulatory actions.
−Removed: The FDA has not yet categorized its December 2019 inspection of our Marietta, Georgia facility.
+Added: The Company’s response included completed and planned actions to address each observation, and all of these remedial actions have been completed.
+Added: The FDA classified its December 2019 inspection of our Kennesaw, Georgia facility as voluntary action indicated (“ VAI ”), which means objectionable conditions or practices were found in their December 2019 inspection but the agency is not taking or recommending any administrative or regulatory actions.
+Added: The FDA also categorized its December 2019 inspection of our Marietta, Georgia facility as VAI.
+Added: The Company believes it has significantly progressed its CGMP compliance and maintains a proactive dialogue with the FDA regarding its continued application of CGMP throughout its portfolio.
Intellectual Property
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Due to the substantial expertise and investment of time, effort and financial resources required to bring new regenerative biomaterial products and implants to the market, the importance of obtaining and maintaining patent protection for significant new technologies, products and processes cannot be underestimated.
−Removed: As of the date of the filing of this Form 10-K, in addition to international patents and patent applications, we own 58 U.S.
+Added: As of the date of the filing of this Annual Report, in addition to international patents and patent applications, we own 62 U.S.
patents related to our amniotic tissue technology and products, and 32 additional patent applications covering aspects of this technology are pending at the United States Patent and Trademark Office.
−Removed: The vast majority of our domestic patents covering our core amniotic tissue technology and products will not begin to expire until August 2027.
+Added: The vast majority of our domestic patents covering our core amniotic tissue technology and products will
+Added: not begin to expire until August 2027.
See discussion below – “ Risk Factors ” under the heading “ Risks Related to Our Intellectual Property .”
Market Overview
−Removed: Domestic sales currently account for substantially all of our revenue, and we are pursuing international expansion, primarily targeting Japan and select countries in Europe, Asia Pacific, and the Middle East.
−Removed: In the United States, advanced wound care applications, including burn treatment and lower extremity surgeries, are our primary areas of clinical use.
+Added: Domestic sales currently account for substantially all of our revenue, and we are actively pursuing international expansion, primarily targeting Japan and select countries in Europe, Asia Pacific, and the Middle East.
+Added: In the United States, our primary areas of clinical use include advanced wound care and surgical recovery applications.
The broad wound care category includes traditional dressings such as bandages, gauzes and ointments, which are used to treat non-severe or non-chronic wounds, and advanced wound care products such as medical devices, advanced dressings, xenografts, biological products, and HCT/Ps, which are used as skin substitutes to treat severe wounds or chronic wounds that have not appropriately closed after four weeks of treatment with traditional or standard of care dressings.
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population, or approximately 6.9 million people suffering from chronic wounds.
−Removed: Of these chronic cases, approximately 57% or 3.8 million are
−Removed: categorized as chronic leg ulcers (which include DFUs and VLUs), with 39% treated with advanced wound care dressing such as skin substitutes (GlobalData:
+Added: Of these chronic wounds, approximately 58% or 3.9 million are categorized as chronic leg ulcers (which include DFUs and VLUs), with 43% treated with advanced wound care dressings such as skin substitutes (GlobalData:
2021 Wound Care Management- Tissue Engineered Skin Subs - US - 2015-2030).
−Removed: MiMedx is a leader in the advanced wound care category and the amniotic tissue allograft sub-category.
−Removed: Both of these categories are expected to continue growing due to certain demographic trends, including an aging population, increasing incidence of obesity and diabetes and the associated higher susceptibility to non-healing chronic wounds.
+Added: MiMedx is a leader in the cellular tissue products/skin substitute segment of the advanced wound care category and the amniotic tissue allograft sub-category.
+Added: We expect these markets will continue to grow due to certain demographic trends, including an aging population, increasing incidence of obesity and diabetes and the associated higher susceptibility to non-healing chronic wounds.
Furthermore, the increasing number of patients requiring advanced treatment represents a significant cost burden on the healthcare system.
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However, often times advanced therapies are not employed due to current treatment guidelines, product access, or medical education around the clinical and economic benefits of advanced skin substitutes.
−Removed: We believe this represents a large opportunity for the Company to expand the market and drive initiatives resulting in market gr owth.
+Added: We believe this represents a large opportunity for us to expand the market and drive initiatives resulting in market growth.
According to data provided by BioMedGPS, MiMedx’s EPIFIX is the current product of choice for physicians choosing to use an amniotic skin substitute product as a barrier or cover.
−Removed: EpiFix store s at room temperature for up to five years compared to certain other skin substitutes currently on the market that require cryogenic freezer storage, have limited shelf life, and may not be human-derived.
−Removed: In addition, we market multiple sizes of EpiFix sheets for use as protective barriers which enables a healthcare provider to select an appropriate size graft based on the size of the wound to reduce product waste.
−Removed: The recent launch of our EpiCord Expandable product line also offers an alternative treatment option to address larger, deeper wounds in a cost-effective way earlier in the treatment algorithm.
−Removed: Our AmnioFix tissue allografts have been used in a variety of surgical applications including, but not limited to, plastic surgery, general surgery, gynecology, urology, orthopedics, spinal surgery, lower extremity repair and sports medicine procedures.
−Removed: AmnioFix can be used as a barrier membrane in procedures where scar tissue formation may be problematic, or where a second surgery may be required.
+Added: Our EPIFIX and EPICORD products can be stored at room temperature for up to five years compared to certain other skin substitutes currently on the market that require cryogenic freezer storage, have limited shelf life, and may not be human-derived.
+Added: In addition, we market multiple sizes of EPIFIX and EPICORD sheets for use as protective barriers, which enables a healthcare provider to select an appropriate size graft based on the size of the wound to reduce product waste.
+Added: Our EPICORD and EPICORD Expandable product lines also offer an alternative treatment option to address larger, deeper wounds in a cost-effective way earlier in the treatment algorithm.
+Added: Surgical Recovery
+Added: We are expanding beyond advanced wound care into areas of surgical recovery where the use of our tissue products could help reduce complications across several specialties, including plastic surgery, general surgery, gynecology, urology, orthopedics, spinal surgery, lower extremity repair and sports medicine procedures.
+Added: Certain surgical procedures can have an increased likelihood of complications such as dehiscence, adhesions, and others that may affect both the recovery of the patient and the outcome of the surgery.
+Added: The rate of complications can depend on a number of factors, including the complexity of the procedure and patient specific issues, such as obesity, diabetes or advanced age.
+Added: Surgical recovery applications focus on the use of tissue products to augment tissue, serve as a barrier membrane in procedures where scar tissue formation may be problematic or where a second surgery may be required, or aid in incisional closure with the goal of preventing or reducing procedural complications.
+Added: Following a thorough review of surgical procedures and potential clinical applications across several specialties, we have identified those areas where we believe our tissue products could be incorporated.
+Added: We are targeting certain procedures for use of our products based on unmet clinical need, potential procedural complication rate, clinical relevance, economic factors and overall business priorities.
+Added: As in advanced wound care, we believe this market is expanding as a result of demographic trends, including an aging population, increasing incidence of obesity and diabetes and the associated higher susceptibility to non-healing chronic wounds.
+Added: International
+Added: The Company is actively pursuing international expansion, with an initial focus in Japan.
+Added: 2021 estimates indicate that within a total Japanese population of approximately 126 million people, there are approximately 626,000 chronic leg ulcers, 100,000 of which are potential candidates for an advanced wound care product (GlobalData Tissue Engineered-Skin Sub Data Model
+Added: Wound Management Year).
+Added: The Japanese population has the largest proportion of people 65 or older in the world, estimated to be approximately 36.2 million (28.8%) in 2020, increasing the potential need for healthcare products and services (Statistics Bureau of Japan, https://www.stat.go.jp/english/data/handbook/c0117.html).
+Added: We believe these demographic trends, along with an increasing incidence of obesity and diabetes and the associated higher susceptibility to non-healing chronic wounds, present a significant unmet patient need and underpenetrated market opportunity.
+Added: MIMEDX received regulatory approval from the Japanese Ministry of Health, Labor and Welfare in June 2021 to market EPIFIX in Japan, as the first amniotic tissue approved for hard-to-heal chronic wounds, such as DFUs and VLUs, which do not respond to conventional therapy.
+Added: We expect to secure reimbursement approval in mid- 2022, and are putting in place the necessary structure, medical education programs, and market development initiatives to operationalize our commercial strategy.
+Added: The Company is also evaluating opportunities for geographic expansion in the United Kingdom and certain other countries in Europe and the Middle East.
+Added: Current efforts are focused on the collection of real-world evidence to support the development of patient treatment guidelines, health economic analysis, and product reimbursement in core markets.
Biologics License Application (BLA) Programs
−Removed: The FDA clarified its expectations in late 2017 that certain cellular and tissue-based products, including types of products marketed by MiMedx, are considered drugs, devices, and/or biological products subject to Section 351 requirements under the federal Food, Drug and Cosmetic Act (the “ FD&C Act ”).
−Removed: In order to conform to this regulatory guidance, MiMedx is pursuing several indications under the BLA pathway, although there can be no assurance that we will obtain a BLA and we may ultimately decide not to pursue a BLA for certain products or indications.
+Added: In 2017 the FDA released guidance clarifying its views that certain cellular and tissue-based products, including certain products marketed by MiMedx, are considered drugs, devices, and/or biological products subject to Section 351 requirements under the federal Food, Drug and Cosmetic Act (the “ FD&C Act ”).
+Added: In order to conform to this regulatory guidance, MiMedx is pursuing indications under the BLA pathway, although there can be no assurance that we will obtain a BLA and we may ultimately decide not to pursue a BLA for these products or indications.
See Risk Factors - “ Obtaining and maintaining the necessary regulatory approvals for certain of our products will be expensive and time consuming and may impede our ability to fully exploit our technologies.”
−Removed: AmnioFix Injectable is our lead BLA product candidate, and we have three ongoing IND programs:
−Removed: plantar fasciitis (Phase 3), Achilles tendonitis (Phase 3) and knee osteoarthritis (Phase 2B).
−Removed: We have completed enrollment of subjects in each of these programs in their current phase.
+Added: mdHACM is our lead BLA product candidate.
+Added: We conducted three IND programs in the areas of plantar fasciitis (Phase 3 clinical trial conducted), Achilles tendonitis (Phase 3 clinical trial conducted) and knee osteoarthritis (Phase 2B clinical trial conducted).
See Clinical Trials, below, for more information.
−Removed: After oral non-habit forming pain medication fails to adequately relieve a patient’s joint, ligament or tendon pain, market available injections such as corticosteroids are a commonly available treatment option.
−Removed: However, a number of patients still do not get adequate relief from corticosteroid injections, or do not want to use corticosteroids given their potential to damage human tissue.
−Removed: Additionally, in light of the current crisis with opioid abuse, non-surgical treatments and alternative approaches to musculoskeletal pain management are under consideration.
+Added: After oral non-habit forming pain medication fails to adequately relieve a patient’s joint, ligament or tendon pain, market available injections such as corticosteroids and hyaluronic acid are commonly used treatment options.
+Added: However, a number of patients still do not get adequate relief from these injections, or do not want to use corticosteroids for a variety of reasons.
+Added: Additionally, in light of the crisis with opioid abuse, non-surgical treatments and alternative approaches to musculoskeletal pain management are under consideration.
Patients and physicians are searching for new products that are safe and effective for the management of chronic and degenerative musculoskeletal conditions.
−Removed: More than 2.2 million people suffer from plantar fasciitis in the U.S., according to data from the National Center for Complimentary and Integrative Health, March 2018.
−Removed: Plantar fasciitis can become a chronic issue causing tissue damage and continuous pain, and recurrence is common.
−Removed: Approximately one million patients annually seek treatment, and available therapies include conservative options, such as ice and custom orthotics, corticosteroid injections, and potentially surgery.
−Removed: Based on primary research and a conjoint analysis conducted, we estimate that approximately 20,000 to 50,000 patients per year may be candidates for AmnioFix Injectable as a non-surgical treatment option to reduce pain and improve function in patients suffering from plantar fasciitis.
Osteoarthritis (“ OA ”) is a disease characterized by progressive articular cartilage destruction, ultimately leading to disabling pain and joint dysfunction.
The knee is the most commonly affected joint and knee OA represents the leading cause of disability in the adult population.
−Removed: 17.5 million people suffer from symptomatic knee osteoarthritis (GlobalData:
−Removed: 2020 Orthopedic Devices -
−Removed: Knee Reconstruction - US - 2015-2030) , and this number is expected to increase to 19 million people by 2025 (GlobalData:
+Added: Estimates indicate that approximately 17.5 million people suffered from symptomatic knee osteoarthritis in 2020 (GlobalData:
+Added: 2020 Orthopedic Devices Knee Reconstruction - US - 2015-2030), and this number is expected to increase to 19 million people by 2025 (GlobalData:
2020 Orthopedic Devices - Knee Reconstruction - US - 2015-2030).
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Current treatment options include analgesics, non-steroidal anti-inflammatory drugs (“ NSAIDs ”), injectable corticosteroids, viscosupplements, platelet rich plasma, and other emerging therapies.
−Removed: 80% of symptomatic knee OA patients fail conservative therapy (GlobalData:
+Added: Approximately 80% of symptomatic knee OA patients fail conservative therapy (GlobalData:
2020 Orthopedic Devices - Viscosupplementation - US - 2015-2030).
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According to estimates by Global Data’s United States Knee Reconstruction Model, approximately one million people required knee reconstruction surgery in 2020, with 2% needing bilateral knee replacement.
−Removed: Costs for knee replacement procedures, on average, can exceed $55,000.
−Removed: Based on primary research and a conjoint analysis conducted, we believe approximately 1.0 - 1.5 million patients per year may be candidates for AmnioFix Injectable as a non-surgical treatment option to reduce pain and improve function in patients suffering from knee osteoarthritis.
−Removed: However, as of the date of the filing of this Form 10-K, AmnioFix Injectable has not been approved by the FDA for any such use.
+Added: Costs for knee replacement procedures can exceed $55,000, on average.
+Added: We believe there is significant unmet need for a non-surgical treatment option to reduce pain and improve function in patients suffering from knee osteoarthritis.
+Added: Current estimates of the potential addressable market for mdHACM are dependent on many factors, including the results of our clinical trial program, recommended place in the knee osteoarthritis treatment algorithm, anticipated dosing regimen, as well as the potential for our clinical trials to demonstrate disease modifying characteristics which could further amplify the market opportunity.
+Added: However, mdHACM has not yet been approved by the FDA for any such use.
See Item 1A - Risk Factors - “ Obtaining and maintaining the necessary regulatory approvals for certain of our products will be expensive and time consuming and may impede our ability to fully exploit our technologies.”
Marketing and Sales
−Removed: As of December 31, 2020 our direct sales team was comprised of more than 265 sales professionals, including field sales representatives and field sales management, who call on hospitals, wound care clinics, physician offices, and federal health care facilities such as the Department of Veterans Affairs (the “VA”) and Department of Defense hospitals.
−Removed: We plan to grow our domestic direct sales team by approximately 10% by the end of 2021.
−Removed: Our direct sales force focuses on the advanced and chronic wound care category through multiple sites of service.
−Removed: We also maintain a network of independent sales agents that focus on musculoskeletal applications leveraging the complementary products in their portfolios, access to certain customers, and to provide sales coverage for areas where we do not have a full time sales representative.
+Added: Our direct sales team includes field sales representatives and field sales management, who call on hospitals, wound care clinics, physician offices, and federal health care facilities such as the Department of Veterans Affairs (the “ VA ”) and Department of Defense (“ DoD ”) hospitals.
+Added: Our direct sales force focuses on the advanced wound care and surgical recovery category through multiple sites of service.
+Added: We also maintain a network of independent sales agents that focus on surgical recovery applications leveraging the complementary products in their portfolios, and provide access to certain customers, as well as sales coverage for areas where we do not have a full time sales representative.
We also sell our products through distributors.
Distributors purchase products from us at wholesale prices and resell products to end users.
−Removed: See Note 15, “ Revenue Data by Customer Type .” As discussed above, we sell allografts for dental applications on an OEM basis pursuant to an agreement under which we granted a third party an exclusive license to some of our technology for use in certain fields in a specified field of use.
+Added: See Note 15 to our consolidated audited financial statements included in Item 8 of this Annual Report, “ Revenue .” As discussed above, we sell allografts for certain applications on an OEM basis pursuant to an agreement under which we grant a third party an exclusive license to some of our technology for use in certain fields.
Coverage and Reimbursement
−Removed: With the exception of government accounts, most purchasers of our products are physicians, hospitals or ambulatory surgery centers (“ ASCs ”) that rely on reimbursement by third-party payers.
+Added: With the exception of government accounts, most purchasers of our products include physicians, hospitals or ambulatory surgery centers (“ ASCs ”) that rely on reimbursement by third-party payers.
Accordingly, our growth substantially depends on adequate levels of third-party reimbursement for our products from these payers.
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government accounts ( e.g.
−Removed: , the VA, the Indian Health Service), which do not depend on reimbursement from third party payers.
−Removed: In order for a company to be eligible to have its products purchased by such federal agencies and paid for by the Medicaid program, federal law requires the Company to participate in the VA Federal Supply Schedule (“ FSS ”) pricing program.
−Removed: EpiFix Sheet Products and EpiCord
+Added: , the VA and the Public Health Service (including the Indian Health Service), which do not depend on reimbursement from third party payers.
+Added: In order for us to be eligible to have our products purchased by such federal agencies and paid for by the Medicaid program, federal law requires us to participate in the VA Federal Supply Schedule (“ FSS ”) pricing program.
Medicare Coverage
−Removed: By far, the largest third-party payer in the United States is the Medicare program, which is a federally-funded program that provides healthcare coverage for senior citizens and certain disabled individuals.
+Added: The largest third-party payer in the United States is the Medicare program, which is a federally-funded program that provides healthcare coverage for senior citizens and certain disabled individuals.
The Medicare program is administered by the Centers for Medicare and Medicaid Services (“ CMS ”), an agency within the U.S.
Department of Health and Human Services (“ HHS ”).
−Removed: Medicare Administrative Contractors (“ MACs ”) are private insurance companies that serve as agents of CMS in the
−Removed: administration of the Medicare program and are responsible for making coverage decisions and paying claims for the designated Medicare jurisdiction.
+Added: Medicare Administrative Contractors (“ MACs ”) are private insurance companies that serve as agents of CMS in the administration of the Medicare program and are responsible for making coverage decisions and paying claims for the designated Medicare jurisdiction.
There are seven Part A/B MACs in the U.S., which cover 12 jurisdictions, each with its own geographical jurisdictions, and each MAC has its own standards and process for determining coverage and reimbursement for a procedure or product.
Private payers often follow the lead of governmental payers in making coverage and reimbursement determinations.
−Removed: Therefore, achieving favorable Medicare coverage and reimbursement is usually a significant gating factor for successful coverage and reimbursement for a new product by private payers.
+Added: Therefore, achieving favorable Medicare coverage and reimbursement is usually a significant gating factor for successful coverage and reimbursement for a new product or clinical application by private payers.
The coverage and reimbursement framework for products under Medicare is determined in accordance with the Social Security Act and pursuant to regulations promulgated by CMS, as well as the agency’s coverage and reimbursement guidance.
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Such decisions are based on each MAC’s assessments of the science and efficacy of the applicable product.
−Removed: As noted below under the heading “ Research and Development, ” we have devoted significant resources to clinical studies to provide data to the MACs, as well as other payers, in order to demonstrate the efficacy and clinical effectiveness of our tissue technologies.
−Removed: As of the date of this report, both EpiFix sheets and EpiCord allografts are eligible for coverage by all MACs.
+Added: As noted below under the heading “ Research and Development, ” we have devoted significant resources to clinical studies to provide data to the MACs, as well as other payers, in order to demonstrate the clinical efficacy and economic effectiveness of our tissue technologies.
+Added: As of the date of this report, both EPIFIX and EPICORD allografts are eligible for coverage by all MACs.
In January 2019, EPIFIX and EPICORD received separate CMS HCPCS Codes, Q4186 and Q4187, distinguishing each product in coverage and reimbursement policies.
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Currently, skin substitutes are reimbursed under a “packaged” or “bundled” methodology along with the related application procedure under a two-tier payment system.
−Removed: In the HOPD and ASC setting, providers receive a single payment that reimburses for the application of the product as well as the product itself.
+Added: In the HOPD and ASC setting, providers receive a single payment that reimburses them for the application of the product as well as the product itself.
CMS classifies skin substitutes into low cost or high cost groups, based on a geometric mean unit cost and per day cost.
−Removed: For 2020, the geometric mean unit cost threshold applicable to both our EpiFix and EpiCord allograft products was $48 per square centimeter, and the per day cost threshold is $790.
+Added: For 2022, the geometric mean unit cost threshold applicable to both our EPIFIX and EPICORD allograft products was $48 per square centimeter, and the per day cost threshold was $949.
The national HOPD average packaged (“bundled”) rate for our EPIFIX and EPICORD allograft products was $1,568 in 2018, was $1,549 in 2019, was $1,623 in 2020, was $1,715 in 2021, and is $1,749.26 in 2022.
−Removed: All skin substitute products administered in the HOPD and ASCs setting are bundled except for those that have been approved by CMS for pass-through status.
−Removed: EpiFix was approved by CMS for pass-through status but that status expired on December 31, 2014, and EpiCord has not been approved by CMS for pass-through status.
This “bundled” payment structure applies only to the HOPD and ASCs settings.
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This payment methodology applies only to physician offices.
−Removed: The Medicare payment rates are updated quarterly based on this ASP information for many skin substitute products but not all.
−Removed: EpiFix is included on the Medicare national ASP Drug Pricing File, but EpiCord is not.
+Added: The Medicare payment rates are updated quarterly based on this ASP information for many skin substitute
+Added: products but not all.
+Added: EPIFIX and EPICORD are included on the Medicare national ASP Drug Pricing File.
The published skin substitute Medicare payment rate established by statute is ASP plus 6%.
Reimbursement for products not included on the Medicare national ASP Drug Pricing File are at the discretion of each MAC, which typically is invoice cost or wholesale acquisition cost (“ WAC ”) plus 6%.
−Removed: Medicare payments for all items and services, including EpiFix sheet products and EpiCord, since 2013 have been reduced by 2% under the sequestration required by the Budget Control Act of 2011, as amended by the American Taxpayer Relief Act of 2012.
+Added: Medicare payments for all items and services, including EPIFIX and EPICORD sheet products, since 2013 have been reduced by 2% under the sequestration required by the Budget Control Act of 2011, as amended by the American Taxpayer Relief Act of 2012.
Subsequent legislation extended the 2% reduction to 2030 (although the sequestration was suspended from May 1, 2020 through December 31, 2020 due to COVID-19).
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The law allows for additional sequestration orders, potentially resulting in up to a 4% reduction in Medicare payments under a statutory PAYGO sequestration order.
+Added: The Coronavirus Aid, Relief, and Economic Security (CARES) Act suspended the sequestration payment adjustment percentage of 2% applied to all Medicare Fee-for-Service (FFS) claims from May 1 through December 31, 2020.
+Added: The Consolidated Appropriations Act, 2021, extended the suspension period to March 31, 2021.
+Added: An Act to Prevent Across-the-Board Direct Spending Cuts, and for Other Purposes, signed into law on April 14, 2021, extended the suspension period to December 31, 2021.
Private Payers
−Removed: We have devoted considerable resources to clinical trials to support coverage and reimbursement of our products and have confirmed an increasing number of private payers that reimburse for EpiFix in the physician office, the HOPD and the ASCs settings.
+Added: We have devoted considerable resources to clinical trials to support coverage and reimbursement of our products.
+Added: An increasing number of private payers reimburse for EPIFIX and EPICORD in the physician office, the HOPD and the ASC settings, and we have complete national commercial coverage for the use of EPIFIX in the treatment of DFUs.
Coverage and reimbursement vary according to the patient’s health plan and related benefits.
−Removed: The majority of health plans currently provide coverage for EpiFix for the treatment of DFUs, and many include treatment of VLUs.
−Removed: In 2020, numerous health plans have added EpiCord coverage for the treatment of DFUs.
−Removed: On December 1, 2020, the largest U.S.
−Removed: commercial payer, granted coverage for EpiFix as a proven and medically necessary option in the treatment of diabetic foot ulcers.
−Removed: The Company believes that EpiFix is the only amniotic membrane product to receive coverage under this payer’s updated commercial medical policy.
−Removed: Information contributing to the coverage determination included a third-party technical brief that evaluated a number of skin substitutes for treating chronic wounds, in which EpiFix was noted to have the most
−Removed: Randomized Controlled Trials, a low risk of overall study bias, and statistically significant findings.
+Added: The majority of health plans currently provide coverage for EPIFIX and EPICORD for the treatment of DFUs, and many include treatment of VLUs.
MiMedx has secured payer coverage for over 300 million covered lives, allowing a significant number of patients access to our products.
−Removed: We have established and continue to grow a reimbursement support group to educate providers and patients with regard to accurate coverage and reimbursement information regarding our products, and plan to invest in furthering clinical data supportive of coverage for our products in additional clinical areas of use.
+Added: Information contributing to the coverage determination included a third-party technical brief (by the Agency for Healthcare Research and Quality (“ AHRQ ”)) that evaluated a number of skin substitutes for treating chronic wounds, in which EPIFIX was noted to have the most Randomized Controlled Trials, a low risk of overall study bias, and statistically significant findings.
+Added: We have established and continue to grow a reimbursement support group to educate providers and patients with regard to accurate coverage and reimbursement information regarding our products, and plan to continue investing in clinical data supportive of coverage for our products in additional clinical areas of use.
See discussion below – “ Risk Factors ” under the heading “ Our revenues depend on adequate reimbursement from public and private insurers and health systems.
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As noted above, the ability to sell products in a hospital is dependent upon demonstrating to the hospital the product’s efficacy and cost effectiveness.
−Removed: Micronized and Other Products
−Removed: Currently, our micronized products are available for coverage by only a limited number of Medicare, commercial and state Medicaid plans.
−Removed: EpiFix Micronized is listed on the Medicare national ASP Drug Pricing File and, similar to most Medicare Part B drugs, is reimbursed at ASP plus 6%, effective July 2019.
−Removed: There is currently no specific third-party reimbursement available for AmnioCord, AmnioFill, or AmnioFix sheet, except to the extent such products are bundled as part of a hospital’s claim under a DRG.
−Removed: See discussion below – “ Risk Factors ” under the heading “ Our revenues depend on adequate reimbursement from public and private insurers and health systems.
Customer Concentration
−Removed: A portion of our products are purchased by U.S.
−Removed: government accounts ( e.g.
−Removed: , the VA, the Public Health Service (including the Indian Health Service)).
For the years ended December 31, 2021, 2020, and 2019, our net sales to all U.S.
−Removed: government accounts comprised approximately 5%, 6%, and 8% of our net sales.
+Added: government accounts comprised approximately 3%, 5% and 6% of our net sales, respectively.
We have contracted with a third party as our indefinite delivery/ indefinite quantity channel partner into the VA and DoD markets.
See discussion below – “ Risk Factors ” under the heading “ A portion of our revenues and accounts receivable come from government accounts.
−Removed: Due to lower barriers of entry in the 361 HCT/P regulated market, competition in the placenta-based and allograft tissue field is intense and subject to more frequent new entrants and evolving market dynamics.
+Added: Due to lower barriers of entry in the Section 361 HCT/P regulated market, competition in the placenta-based and allograft tissue field is intense and subject to new entrants and evolving market dynamics.
Companies within the industry compete on the basis of price, ease of handling, logistics and efficacy.
Another important factor is third-party reimbursement, which is difficult to obtain as it is a time-consuming and expensive process.
−Removed: We believe our success in obtaining third-party reimbursement, our strong position with group purchasing organizations, capabilities and experience with CGMP manufacturing, and established clinical evidence for our products are competitive advantages.
−Removed: The Agency for Healthcare Research and Quality (“ AHRQ ”) recently published a technology assessment analyzing Skin Substitutes for Treating Chronic Wounds.
+Added: We believe our success in obtaining third-party reimbursement, our strong position with group purchasing organizations, capabilities and investments to apply CGMP, and established clinical evidence for our products are competitive advantages.
+Added: In February 2020, the AHRQ published a technology assessment analyzing Skin Substitutes for Treating Chronic Wounds.
AHRQ conducted a literature search yielding 164 studies and 81 Supplemental Evidence and Data for Systematic Reviews (“ SEADs ”) submissions.
−Removed: Only 22 randomized, controlled trials (“ RCTs ”) met the inclusion criteria to be reviewed in the AHRQ analysis, and out of the 22 RCTs MiMedx had 6 RCTs included in the final brief.
−Removed: Of the 22 studies reviewed, only 12 were assessed as low risk of bias (ROB) of which 5 were MiMedx RCTs.
+Added: Only 22 randomized, controlled trials (“ RCTs ”) met the inclusion criteria to be reviewed in the AHRQ analysis, and out of the 22 RCTs MiMedx had six RCTs included in the final brief.
+Added: Of the 22 studies reviewed, only 12 were assessed as low risk of bias, of which five were MiMedx RCTs.
This important government assessment highlights our commitment to providing unbiased level 1 clinical evidence in advanced wound treatment.
−Removed: This dedication to elevating the standard of care is further underscored by the fact that the AHRQ points out that MiMedx was the only entity to provide two studies out of the 22 evaluated that performed a subgroup analysis of patients with diabetic foot ulcers that received adequate debridement.
+Added: This dedication to elevating the standard of care is further underscored by the fact that the AHRQ points out in its assessment that MiMedx was the only entity
+Added: to provide two studies out of the 22 evaluated that performed a subgroup analysis of patients with diabetic foot ulcers that received adequate debridement.
Both studies reported an increase in wounds healed with adequate debridement.
Advanced wound care therapies employ technologies to aid in wound healing in cases where the wound is chronic and healing progress has stalled or stopped.
−Removed: The primary competitive products in the skin substitutes category include, among others, placental-tissue membrane allografts, tissue-engineered living skin equivalents, porcine-, bovine- and fish skin-derived xenografts and collagen matrix products.
+Added: The primary competitive products in the skin substitutes category include, among others, placental-tissue allografts, tissue-engineered living skin equivalents, porcine-, bovine- and fish skin-derived xenografts and collagen matrix products.
Xenografts, or tissue transplants from non-human species, serve mainly as an extracellular matrix and have to undergo aggressive processing to remove immunogenic animal products from the tissue.
−Removed: In addition, challenges with xenografts include limited clinical published data, and some products may require suturing or stapling
−Removed: to the wound bed, making handling more difficult.
+Added: In addition, challenges with xenografts include limited clinical published data, and some products may require suturing or stapling to the wound bed, making handling more difficult.
Furthermore, other skin substitutes currently on the market require cryogenic freezer storage and have limited shelf life.
−Removed: Our main competitors in the skin substitute market are Integra LifeSciences Holdings Corporation, Organogenesis, Inc., and Smith & Nephew plc, which sell a variety of advanced wound care products including skin substitutes and placental tissue allografts.
−Removed: The primary competitive products in the surgical, orthopedic or sports medicine categories are other amniotic membrane allografts and injectable solutions, such as platelet-rich plasma, evolving cellular alternatives, or steroids.
+Added: Our main competitors in the skin substitute market include Integra LifeSciences Holdings Corporation, Organogenesis, Inc., and Smith & Nephew plc, which sell a variety of advanced wound care products, including skin substitutes and placental tissue allografts.
+Added: In addition, the overall market is competitive, with a large number of other competitors that compete regionally and nationally.
See discussion below – “ Risk Factors ” under the heading “ We are in a highly competitive and evolving field and face competition from well-established tissue processors and medical device manufacturers, as well as new market entrants.
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The products manufactured and processed by the Company are derived from human tissue.
−Removed: As discussed below, Section 361 HCT/Ps are tissue-based products that are regulated solely under Section 361 and do not require pre-market clearance or approval by the FDA.
−Removed: Section 351 HCT/Ps are also tissue products but are regulated as biological products, medical devices or drugs and, in order to be lawfully marketed in the United States, require FDA pre-market clearance or approval.
+Added: As discussed below, our Section 361 HCT/Ps are tissue-based products that are regulated solely under Section 361 and do not require pre-market clearance or approval by the FDA.
+Added: Our Section 351 HCT/Ps are also tissue products, but are regulated as biological products, and, in order to be lawfully marketed in the United States, require FDA pre-market approval.
See discussion below – “ Risk Factors ” under the heading “ Risks Related to Regulatory Approval of Our Products and Other Government Regulations .”
Tissue Products
−Removed: In 1997, the FDA proposed a new regulatory framework for cells and tissues.
−Removed: This framework was intended to provide adequate protection of public health while enabling the development of new therapies and products with as little regulatory burden as possible.
−Removed: A key innovation in the system is that covered HCT/Ps would be regulated solely under Section 361 and would not be subject to pre-market clearance.
+Added: In 1997, the FDA proposed a regulatory framework for cells and tissues.
+Added: This framework was intended to provide adequate protection of public health while enabling the development of new therapies and products with limited regulatory burden.
+Added: A key innovation in the system was that covered HCT/Ps would be regulated solely under Section 361 and would not be subject to pre-market clearance.
The registration and listing rules were finalized in January 2001 in 21 CFR Part 1271.
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• it must not have a systemic effect and must not be dependent upon the metabolic activity of living cells for its primary function.
−Removed: Amniotic and other birth tissue are considered cellular and tissue-based articles and are therefore eligible for regulation solely as a Section 361 HCT/P depending on whether the specific product at issue and the claims made for it are consistent with the criteria set forth above.
+Added: Certain amniotic and other birth tissues are considered cellular and tissue-based articles and are therefore eligible for regulation solely as a Section 361 HCT/P depending on whether the specific product at issue and the claims made for it are consistent with the criteria set forth above.
HCT/Ps that do not meet these criteria are subject to more extensive regulation as drugs, medical devices, biological products or combination products.
−Removed: Products Regulated Solely as HCT/Ps
+Added: Products Regulated Solely as Section 361 HCT/Ps
The FDA has specific regulations governing HCT/Ps, including some regulations specific to Section 361 HCT/Ps, which are set forth in 21 CFR Part 1271.
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The CGTP govern, as may be applicable, the facilities, controls and methods used in the manufacture of all HCT/Ps, including processing, storage, recovery, labeling, packaging and distribution of Section 361 HCT/Ps.
−Removed: CGTP require us, among other things, to maintain a quality program, train personnel, control and monitor environmental conditions as appropriate, control and validate processes,
−Removed: properly store, handle and test our products and raw materials, maintain our facilities and equipment, keep records and comply with standards regarding recovery, pre-distribution, distribution, tracking and labeling of our products and complaint handling.
+Added: CGTP require us, among other things, to maintain a
+Added: quality program, train personnel, control and monitor environmental conditions as appropriate, control and validate processes, properly store, handle and test our products and raw materials, maintain our facilities and equipment, keep records and comply with standards regarding recovery, pre-distribution, distribution, tracking and labeling of our products and complaint handling.
21 CFR Part 1271 also mandates compliance with adverse reaction and CGTP deviation reporting and labeling requirements.
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See Item 1A Risk Factors, “ Our business is subject to continuing regulatory compliance by the FDA and other authorities, which is costly, and our failure to comply could result in negative effects on our business, results of operations and financial condition.”
−Removed: Recent FDA Guidance and Transition Policy for HCT/Ps
+Added: 2017 FDA Guidance and Transition Policy for HCT/Ps
In November 2017, the FDA released four guidance documents that, collectively, the agency described as a “comprehensive policy framework” for applying existing laws and regulations governing regenerative medicine products, including HCT/Ps.
One guidance document in particular, “ Regulatory Considerations for Human Cells, Tissues, and Cellular and Tissue – Based Products:
−Removed: Minimal Manipulation and Homologous Use – Guidance for Industry and Food and Drug Administration Staff ,” offered important clarity on some of the issues that the Company had previously raised with the FDA.
+Added: Minimal Manipulation and Homologous Use – Guidance for Industry and Food and Drug Administration Staff ,” offered important clarity.
The guidance documents confirmed that sheet forms of amniotic membrane generally are appropriately regulated as solely Section 361 HCT/Ps when intended for use as a barrier or covering.
−Removed: We continually ev aluate our marketing materials for each of our products to align with the FDA’s guidance.
−Removed: Second, the guidance documents confirmed the FDA’s stance that all micronized amniotic membrane products are more than minimally manipulated, and therefore are not Section 361 HCT/Ps.
−Removed: However, the guidance documents also stated that the FDA intends to exercise enforcement discretion under limited conditions with respect to the IND application and pre-market approval requirements for certain HCT/Ps through November 2020, which was later extended through May 2021.
+Added: We continually evaluate our marketing materials for each of our products to align with FDA guidance.
+Added: Second, the guidance documents confirmed the FDA’s stance that all micronized amniotic membrane products are more than minimally manipulated, and therefore do not qualify as Section 361 HCT/Ps.
+Added: However, the guidance documents also stated that the FDA intended to exercise enforcement discretion under limited conditions with respect to the IND application and pre-market approval requirements for certain HCT/Ps through November 2020, which was later extended through May 2021.
This period of enforcement discretion was intended to give sponsors time to evaluate their products, have a dialogue with the agency and, if necessary, begin clinical trials and file the appropriate pre-market applications.
−Removed: The FDA’s approach is risk-based, and the guidance documents clarified that high-risk products and uses could be subject to immediate enforcement action.
−Removed: This enforcement discretion applies across our industry, and the Company has continued to market its products under this policy of enforcement discretion.
−Removed: At the same time, we are pursuing the BLA pre-market approval process for certain uses of AmnioFix Injectable.
−Removed: There is no assurance that the FDA will grant these approvals on a timely basis, or at all, or that we will not discontinue our pursuit of a BLA for certain products or indications.
+Added: The FDA’s approach was risk-based, and the guidance documents clarified that high-risk products and uses could be subject to immediate enforcement action.
+Added: This enforcement discretion applied across our industry, and during the period, the Company continued to market its products under this policy of enforcement discretion.
+Added: After May 31, 2021, the Company no longer markets or sells its micronized and particulate products in the United States.
+Added: We are pursuing the BLA pre-market approval process for certain uses of mdHACM.
+Added: However, there is no assurance that the FDA will grant these approvals on a timely basis, or at all, or that we will not discontinue our pursuit of a BLA for certain products or indications.
See “ Clinical Trials ” below for more information.
−Removed: During the remainder of the enforcement discretion period, the Company will also continue to explore possible options for extending this enforcement discretion period.
−Removed: To this end, the Company has initiated dialogue and efforts for a further transition plan with the FDA to allow for continued marketing of the impacted products while the Company transitions to compliance with Section 351, the applicable sections of the FD&C Act, the CGMP regulations in 21 CFR Part 210 and 211, and other applicable FDA regulations.
−Removed: This would be an extension of the current policy, and there is no guarantee that the FDA will provide more time, either for MiMedx or the industry at large.
Products Regulated as Biologics – The BLA Pathway
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• Satisfactory completion of an FDA Advisory Committee review, if applicable;
−Removed: • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with FDA’s CGMP regulations, to assure that the facilities, methods and controls are adequate to ensure the product’s identity, potency, quality and purity; and
+Added: • Satisfactory completion of an FDA inspection of the manufacturing facility or facilities at which the product is produced to assess compliance with FDA’s CGMP regulations, to assure that the facilities, methods and controls are adequate to ensure the product’s identity, potency, quality and purity;
• FDA approval of the BLA, including agreement on post-marketing commitments, if applicable.
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Phase 1 trials typically involve a small number of healthy volunteers and are designed to provide information about the product safety and to evaluate the pattern of drug distribution and metabolism within the body.
−Removed: Phase 2 trials are conducted in a larger but limited group of patients afflicted with a particular disease or condition in order to determine preliminary efficacy, dosage tolerance and optimal dosing, and to identify possible adverse effects and safety risks.
+Added: Phase 2 trials are conducted in a larger but limited group of
+Added: patients afflicted with a particular disease or condition in order to determine preliminary efficacy, dosage tolerance and optimal dosing, and to identify possible adverse effects and safety risks.
Dosage studies are typically designated as Phase 2A, and efficacy studies are designated as Phase 2B.
12 unchanged sentences
pursuing product seizures, consent decrees or other injunctive relief;
−Removed: and criminal prosecution through the DOJ.
+Added: and criminal prosecution through the Department of Justice (“ DOJ ”).
Clinical Trials
Trial Overview
−Removed: The Company is currently conducting three IND programs investigating the use of AmnioFix Injectable to reduce pain and increase function in patients with plantar fasciitis, Achilles tendonitis, and knee osteoarthritis.
−Removed: As previously disclosed, the trials were developed and initially overseen by senior managers who are no longer with the Company.
−Removed: Based on a review of the studies and interim results, the Company has instituted several actions with respect to its ongoing and anticipated clinical trials to address the resources, capabilities and expertise needed for commercial launch, including our strategy around an increased dialogue with the FDA regarding our BLA progress.
+Added: The Company recently completed three IND studies investigating the use of mdHACM to reduce pain and increase function in patients with plantar fasciitis, Achilles tendonitis, and knee osteoarthritis.
+Added: As previously disclosed, the trials were developed and initially overseen by senior managers, many of whom are no longer with the Company.
+Added: The Company has instituted several actions with respect to its ongoing and anticipated clinical trials to address the resources, capabilities and expertise needed for an effective dialogue with the FDA regarding our BLA progress.
However, there can be no assurance that we will obtain BLA approval and we may ultimately decide not to pursue a BLA for certain products or indications.
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Plantar Fasciitis
−Removed: In March 2015, we initiated a Phase 2B prospective, single-blinded, RCT investigating a single injection of 40 mg of AmnioFix Injectable as compared to a single intra-plantar injection of saline (placebo control) in the treatment of patients with recalcitrant plantar fasciitis pain and foot dysfunction.
+Added: In March 2015, we initiated a Phase 2B prospective, single-blinded, RCT investigating a single injection of 40 mg of mdHACM as compared to a single intra-plantar injection of saline (placebo control) in the treatment of patients with recalcitrant plantar fasciitis pain and foot dysfunction.
This trial enrolled 145 patients at 15 study sites.
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Formal FDA feedback from this meeting was incorporated into our development plans.
−Removed: Based on this feedback and the Phase 2B interim data, in January 2018 we initiated a Phase 3 prospective, double-blinded, RCT to assess the safety and efficacy of a single 40 mg intra-plantar injection of AmnioFix Injectable as compared to a single intra-plantar injection of saline (placebo control) to treat patients with recalcitrant plantar fasciitis pain.
−Removed: The trial plan was initially to enroll 164 patients.
−Removed: In July 2019, we conducted an interim analysis to assess adequacy of the sample size to assess differences between the two treatment groups.
−Removed: We analyzed the data received from this sample size analysis, conducted on subjects representing 50% of total enrollment that had reached the primary efficacy endpoint.
+Added: Based on this feedback and the Phase 2B interim data, in January 2018 we initiated a Phase 3 prospective, double-blinded, RCT to assess the safety and efficacy of a single 40 mg intra-plantar injection of mdHACM as compared to a single intra-plantar injection of saline (placebo control) to treat patients with recalcitrant plantar fasciitis pain.
+Added: The trial plan was initially to enroll 164 patients, with an interim analysis to assess adequacy of this sample size built into the statistical plan.
+Added: In July through August 2019, we conducted an interim analysis on subjects representing 50% of total enrollment that had reached the primary efficacy endpoint, to assess adequacy of the sample size to assess differences between the two treatment groups.
This analysis indicated that a significant increase in sample size would be required to observe clinically and statistically significant improvement and separation between treatment and control groups.
−Removed: We determined that increasing the
−Removed: sample size to 276 patients would provide sufficient power to observe an efficacy result with statistical and clinical significance.
−Removed: We have instituted these changes and amendments and completed enrollment of 277 subjects in September 2020.
−Removed: We expect the last patient out in the second quarter of 2021, which will allow us to analyze the data and request a meeting with the FDA to review our clinical evidence.
−Removed: If the plantar fasciitis trials are determined to be adequate proof of efficacy and safety, we expect to file a BLA for AmnioFix Injectable to treat patients with plantar fasciitis in the first half of 2022, and are evaluating ways to accelerate this program where possible.
−Removed: We expect the outcome of this trial will help inform additional areas of unmet need for potential clinical study and may benefit our BLA submissions for other indications.
−Removed: We also anticipate that our efforts in obtaining regulatory approval of AmnioFix Injectable for plantar fasciitis will benefit the regulatory review of AmnioFix Injectable for other indications, based on the fact that it is the same product with the same manufacturing process and other attributes relevant to approval.
−Removed: However, there can be no assurance that we will receive FDA approval.
−Removed: Approval may be delayed due to a variety of factors, including failure of the studies to achieve their endpoints;
−Removed: the ability of the study to demonstrate clinically and statistically significant improvement between treatment and control groups;
−Removed: the impact of the COVID-19 pandemic on study enrollment and FDA operations;
−Removed: the potential that the results of the clinical studies do not merit further investment;
−Removed: and the work required to achieve commercial and manufacturing readiness.
−Removed: See discussion in Item 1A - “ Risk Factors ” under the heading “ Obtaining and maintaining the necessary regulatory approvals for certain of our products will be expensive and time-consuming and may impede our ability to fully exploit our technologies.”
+Added: We determined that increasing the sample size to 276 patients would provide sufficient power to observe an efficacy result with statistical and clinical significance.
+Added: We instituted these changes and amendments and completed enrollment of 277 subjects in September 2020.
+Added: Following completion of the study, initial review of the trial data during the third quarter of 2021 revealed that the study did not meet its endpoints.
+Added: The data from the study continue to be the subject of extended analyses, however, as previously disclosed, we do not expect to file a BLA or pursue further studies in this indication at this time.
Knee Osteoarthritis
−Removed: In March 2018, the FDA granted AmnioFix Injectable the Regenerative Medicine Advanced Therapy (“ RMAT ”) designation for use in the treatment of osteoarthritis of the knee.
+Added: In March 2018, the FDA granted mdHACM the Regenerative Medicine Advanced Therapy (“ RMAT ”) designation for use in the treatment of osteoarthritis of the knee.
RMAT-designated products are eligible for increased and earlier interactions with the FDA, similar to those interactions available to fast-track and breakthrough-designated therapies.
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The meetings with sponsors of RMAT- designated products may include discussions of whether accelerated approval would be appropriate based on surrogate or intermediate endpoints reasonably likely to predict long-term clinical benefit or reliance upon data obtained from a meaningful number of sites.
−Removed: In March 2018, we initiated a Phase 2B prospective, double-blinded RCT investigating a single intra-articular injection of 40 mg of AmnioFix Injectable as compared to a single injection of saline (placebo control) in the treatment of pain and functional impairment in patients with osteoarthritis of the knee.
+Added: In March 2018, we initiated a Phase 2B prospective, double-blinded RCT investigating a single intra-articular injection of 40 mg of mdHACM as compared to a single injection of saline (placebo control) in the treatment of pain and functional impairment in patients with osteoarthritis of the knee.
This trial was planned to enroll 318 patients, with an interim analysis to assess adequacy of this sample size built into the statistical plan.
−Removed: This blinded interim analysis was performed in August 2019 and revealed that while differences in the treatment groups were observed, the power to observe statistically and clinically significant results would be enhanced by increasing the sample size to 466 patients.
+Added: This blinded interim analysis was performed in July through
+Added: August 2019 and revealed that while differences in the treatment groups were observed, the power to observe statistically and clinically significant results would be enhanced by increasing the sample size to 466 patients.
Amendments to the protocol to allow this increase were subsequently approved.
−Removed: It should be noted that during the first half of 2020 in particular, the ongoing COVID-19 pandemic slowed study enrollment considerably, though began to resolve in the third quarter of the year.
−Removed: Due to actual dropout rates observed in the study being lower than planned, in September 2020, we completed enrollment of 447 patients, and anticipate this number will allow for sufficient power to make the planned analyses.
+Added: It should be noted that during the first half of 2020 in particular, study enrollment slowed considerably due to the ongoing COVID-19 pandemic , although this did begin to resolve in the third quarter of the year.
+Added: Due to actual dropout rates observed in the study being lower than planned, in September 2020, we completed enrollment of 447 patients.
We also amended the protocol to establish an open label extension to the trial and allow patients to receive a second injection of the active treatment at six months, nine months, or 12 months subsequent to their completion of study visits, if their pain has not resolved or responded, regardless of treatment arm.
−Removed: The study will still be blinded to subjects, sites and MiMedx during this extension.
−Removed: We expect that the blinded primary and secondary efficacy observation visits of this trial will be completed in April 2021, and expect the last patient visit will be completed in the second half of 2021.
−Removed: Following the completion of this study, and if the data from the study are favorable, we expect to launch a Phase 3 study in the beginning of 2022 and file a BLA for this indication in the second half 2024 or first half of 2025.
−Removed: We are exploring opportunities to accelerate the program where possible, including the anticipated start date of the Phase 3 trial and the submission of a BLA.
−Removed: There can be no assurance that the COVID-19 effects on study activities and FDA resources will fully resolve and allow completion of all activities in the anticipated timeframe;
−Removed: that the ongoing wave of virus infections will not continue to impact the study;
−Removed: that no further disruptions can be expected, or when completed, that the FDA will view the Phase 2B and Phase 3 studies as sufficient to support a BLA filing.
−Removed: There can be no assurance that we will receive FDA approval, and approval may be delayed due to a variety of factors, including failure of the studies to achieve their endpoints;
−Removed: the extra effort and cost required to improve our clinical trials as described above;
+Added: The study was still blinded to subjects, sites and MiMedx during this extension.
+Added: The six months blinded efficacy visits in this study were completed during the second quarter of 2021, and analyses were completed during the third quarter of 2021.
+Added: The final study visits are expected to occur (open label extension) during the second quarter of 2022.
+Added: As previously announced, the trial did not meet its primary endpoints, however it revealed that the 190 subjects enrolled prior to an interim analysis performed for sample size correction in July through August 2019 showed a statistically significant and clinically meaningful difference in favor of mdHACM in WOMAC total scores and both the pain and function subscales compared to the placebo.
+Added: However, subjects enrolled after this interim analysis did not show separation from the placebo.
+Added: Third-party biostatisticians validated the improvement in WOMAC Pain at three and six months, respectively (p=0.032 and p=0.009), WOMAC Function (p=0.046 and p=0.009), and WOMAC Total (p=0.038 and p=0.008) for the Pre-Interim Analysis Cohort of 190 patients.
+Added: Our root-cause analysis has determined that the potency of the investigational product faded as it aged, resulting in the study’s failure to meet its primary endpoints.
+Added: The Company’s proprietary biochemical and biological tests detected this reduced potency, related to the age of the investigational product used in the Phase 2B KOA study.
+Added: Based on the clinically meaningful and statistically significant data from the Pre-Interim Analysis Cohort of 190 patients in the Phase 2B trial, published retrospective data, extensive real-world clinical use, and ongoing scientific mechanism of action research, the Company expects to initiate a Phase 3 KOA program in 2022, with a BLA filing anticipated in late 2025, and will work closely with the FDA in advancing these trials.
+Added: There can be no assurance, however, that our anticipated time frame for commencing the Phase 3 KOA program and submitting a BLA will be achieved or that we will receive FDA approval for mdHACM and be able to commercialize this product, or that such approval will not be delayed for a variety of reasons, including failure of the studies to achieve their endpoints;
the impact of the COVID-19 pandemic on study enrollment and FDA operations;
1 unchanged sentence
and the work required to achieve commercial and manufacturing readiness.
−Removed: See discussion in Item 1A - “ Risk Factors ” under the heading “ Obtaining and
−Removed: maintaining the necessary regulatory approvals for certain of our products will be expensive and time-consuming and may impede our ability to fully exploit our technologies.”
+Added: See discussion in Item 1A - “ Risk Factors ” under the heading “ Obtaining and maintaining the necessary regulatory approvals for certain of our products will be expensive and time-consuming and may impede our ability to fully exploit our technologies.”
Achilles Tendonitis
−Removed: In January 2018, we initiated a Phase 3 prospective, double-blinded RCT investigating a single intra-tendon injection of 40 mg of AmnioFix Injectable as compared to a single injection of saline (placebo control) in the treatment of Achilles tendonitis.
+Added: In January 2018, we initiated a Phase 3 prospective, double-blinded RCT investigating a single intra-tendon injection of 40 mg of mdHACM as compared to a single injection of saline (placebo control) in the treatment of Achilles tendonitis.
The planned trial enrollment was 158 patients, with an interim analysis to assess adequacy of the sample size built into the statistical plan.
We analyzed data received from this sample size analysis, conducted on patients representing 50% of total enrollment that had reached the primary efficacy endpoint.
−Removed: This indicated that a substantial increase in sample size would be required to observe clinically and statistically significant improvement and separation between treatment and control groups.
−Removed: With this in mind, we concluded that the most reasonable approach was to continue the study to completion with the originally planned sample size, and analyze the final results to determine the adequacy of the measures employed and time points of observation to show meaningful clinical and statistical analyses.
−Removed: Enrollment for this study has completed and we anticipate that the last patient visit will occur in the first half of 2021.
−Removed: We plan to review our options for this program after we have assessed the results of this study, and may explore the efficacy potential of AmnioFix Injectable in a more well-defined subset of patients.
−Removed: In addition, we plan to initiate efforts to file appropriate investigational applications for AmnioFill and EpiFix Micronized, prior to the end of enforcement discretion in the first half of 2021.
−Removed: We have not yet initiated any clinical trials for AmnioFill or EpiFix Micronized related to these applications.
−Removed: Clinical study initiation will depend on FDA feedback for both of these programs.
−Removed: If any of the study results support potential product approval and potential for commercialization, we intend to file BLAs as described above.
+Added: This analysis indicated that a substantial increase in sample size would be required to observe clinically and statistically significant improvement and separation between treatment and control groups.
+Added: With this in mind, we determined that the most reasonable approach was to continue the study to completion with the originally planned sample size, and analyze the final results to determine the adequacy of the measures employed and time points of observation to show meaningful clinical and statistical analyses.
+Added: Enrollment for this study was completed and the last patient visit occurred in the first half of 2021.
+Added: The data from this study are currently being prepared for analysis.
+Added: We plan to review our options for this program after we have assessed the results of this study;
+Added: however, as previously disclosed, we do not expect to file a BLA or pursue further studies in this indication at this time.
+Added: Prior to May 31, 2021, the date the FDA’s period of enforcement discretion ended, we filed appropriate investigational applications for AMNIOFILL and EPIFIX Micronized.
+Added: Two INDs were approved for EPIFIX, one in chronic wounds, another in surgical incisions, and an investigational device exemption (“ IDE ”) was filed for AMNIOFILL.
+Added: We have not yet initiated any clinical trials for AMNIOFILL or EPIFIX Micronized related to these applications, and have no immediate plans to advance these programs.
+Added: If study results support potential product approval and potential for commercialization, we intend to file BLAs as described above.
The process of obtaining an approved BLA requires the expenditure of substantial time, effort and financial resources and may take years to complete.
The fee for filing a BLA and the annual user fees payable with respect to any establishment that manufactures biologics and with respect to each approved product are substantial.
−Removed: While there can be no assurance that we will ultimately obtain regulatory approval for our micronized products, we have already completed substantial work towards multiple BLAs, including engineering our manufacturing processes to conform to CGMP requirements.
+Added: While there can be no assurance that we will ultimately obtain regulatory approval for our micronized products, we have already completed substantial work towards our BLA program, including engineering our manufacturing processes to conform to CGMP requirements.
FDA Post–Market Regulation
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Our facilities are also subject to periodic inspections to assess our compliance with the regulations.
−Removed: Products covered by a BLA, New Drug Application, 510(k) clearance or a pre-market approval are subject to numerous additional regulatory requirements, which include, among others, compliance with CGMP (or, in the case of devices, with FDA’s Quality System Regulation), which imposes certain procedural, substantive and record keeping requirements, and labeling regulations to ensure a product’s identity, potency, quality, and purity.
+Added: Products covered by a BLA, New Drug Application, 510(k) clearance or a pre-market approval are subject to numerous additional regulatory requirements, which include, among others, compliance with CGMP (or, in the case of devices, with FDA’s Quality System Regulation), which imposes certain procedural, substantive and record keeping requirements, and labeling regulations to ensure the product’s identity, potency, quality, and purity.
These products are also subject to the FDA’s general prohibition against promoting products for unapproved or “off-label” uses, and additional adverse reaction reporting.
−Removed: As part of our BLA development effort, we are updating our manufacturing establishments into compliance with CGMP for production for our injectable and other applicable Section 351 products.
−Removed: The transition process includes development and enhancement of production processes, procedures, tests and assays, and it requires extensive validation work.
+Added: As part of our BLA development effort, we are updating our manufacturing establishments into maintaining application of CGMP for production of our injectable and other applicable Section 351 products.
+Added: The process includes development and enhancement of production processes, procedures, tests and assays, and it requires extensive validation work.
It also involves the procurement and installation of new production and lab equipment.
These efforts require human capital, expertise and resources.
−Removed: We have made significant improvements in this transition over the last two years.
−Removed: We have engaged industry experts to assess our state of compliance and to provide guidance on the additional activities needed to meet CGMPs.
−Removed: Our goal is to achieve compliance with CGMP for our injectable and other applicable Section 351 products by the time the FDA’s current period of enforcement discretion is complete in May 2021.
−Removed: See discussion in Item 1A – “ Risk Factors ” under the heading “ To the extent our products do not qualify for regulation as human cells, tissues and cellular and tissue-based products solely under Section 361 of the Public Health Service Act, this could result in removal of the applicable products from the market, would
−Removed: make the introduction of some new tissue products more expensive and could significantly delay the expansion of our tissue product offerings and subject us to additional post-market regulatory requirements.”
+Added: We have made significant improvements over the last two years.
+Added: We have engaged industry experts to assess our state of compliance and to provide guidance on the additional activities needed to maintain CGMP.
+Added: Significant improvements include a newly built, validated processing suite applying CGMP that is utilized for processing of Section 351 products.
+Added: See discussion in Item 1A – “ Risk Factors ” under the heading “ Certain of our products no longer qualify for regulation as human cells, tissues and cellular and tissue-based products solely under Section 361 of the Public Health Service Act (“Section 361”), which has resulted in removal of the applicable products from the market, made the introduction of some new tissue products more expensive, significantly delayed the expansion of our tissue product offerings and subjected us to additional post-market regulatory requirements.
+Added: Additional regulatory requirements may be imposed in the future.”
Other Regulation Specific to Tissue Products
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Procurement of certain human organs and tissue for transplantation is subject to the restrictions of the National Organ Transplant Act (“ NOTA ”), which prohibits the transfer of certain human organs, including skin and related tissue, for valuable consideration, but permits the reimbursement of reasonable expenses associated with the removal, transportation, implantation, processing, preservation, quality control and storage of human tissue and skin.
−Removed: Our wholly-owned subsidiary, MiMedx Tissue Services, LLC, is registered with the FDA as an establishment that manufactures human cells, tissues and cellular and tissue-based productions and is involved with the recovery and storage of donated human amniotic tissue.
+Added: Our wholly-owned subsidiary, MiMedx Tissue Services, LLC, is registered with the FDA as an establishment that manufactures human cells, tissues and cellular and tissue- based products and is involved with the recovery and storage of donated human amniotic membrane.
We reimburse tissue banks, hospitals and physicians for their services associated with the recovery and storage of donated human tissue.
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As discussed above, we are required to register with the FDA as an establishment that manufactures human cells, tissues and cellular and tissue-based products.
−Removed: We are licensed, registered, or permitted as a tissue bank in California, Georgia, New York, Delaware, Illinois, Oregon, and Maryland.
+Added: We are licensed, registered, or permitted as a tissue bank in California, New York, Delaware, Illinois, Oregon, and Maryland.
Additionally, we received and actively maintain AATB accreditation.
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Compliance with these standards is required in order to become an AATB-accredited tissue establishment.
−Removed: AATB standards include specific requirements for recovery, screening, testing, labeling and processing of placenta tissue.
+Added: AATB standards include specific requirements for recovery, screening, testing, labeling, processing, and storing of birth tissue.
We believe we are compliant in all material respects with AATB standards and our state licensure requirements.
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These regulations include those described below.
+Added: See also the discussion under “ Risk Factors - We and our sales representatives, whether employees or independent contractors, must comply with various federal and state anti-kickback, self-referral, false claims and similar laws, any breach of which could cause an adverse effect on our business, results of operations and financial condition.”
• The federal Anti-Kickback Statute, which is a criminal law that prohibits, among other things, any person from knowingly and willfully offering, soliciting, receiving or providing any remuneration (including any kickback, bribe or rebate), directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward referrals, purchases or orders, or arranging for or recommending the purchase, order or referral of any item or service for which payment may be made in whole or in part by a federal healthcare program, such as the Medicare and Medicaid programs.
The term “remuneration” has been broadly interpreted to include anything of value.
−Removed: The Patient Protection and Affordable Care Act amended the intent requirement of the federal Anti-Kickback Statute, so that a person or entity no longer needs to have actual knowledge of this statute or specific intent to violate it.
+Added: The Patient Protection and Affordable Care Act amended the intent requirement of the federal Anti-Kickback Statute, so that a person or entity no longer needs to have actual knowledge of this statute or
+Added: specific intent to violate it.
A conviction for violation of the Anti-Kickback Statute results in criminal fines and requires mandatory exclusion from participation in federal health care programs.
Although there are a number of statutory exceptions and regulatory safe harbors to the federal Anti-Kickback Statute that protect certain common industry practices from prosecution, the exceptions and safe harbors are drawn narrowly, and arrangements may be subject to scrutiny or penalty if they do not fully satisfy all elements of an available exception or safe harbor.
−Removed: See discussion below under “ Risk Factors–We and our sales representatives, whether employees or independent contractors, must comply with various federal and state anti-kickback, self-referral, false claims and similar laws, any breach of which could cause an adverse effect on our business, results of operations and financial condition.
• The federal False Claims Act (“ FCA ”) imposes significant civil liability on any person or entity that knowingly presents, or causes to be presented, a claim for payment to the U.S.
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As a result of a modification made by the Fraud Enforcement and Recovery Act of 2009, a claim includes “any request or demand” for money or property presented to the U.S.
−Removed: In April 2020, the Company settled a qui tam action brought by two former employees alleging violations of the FCA relating to the
−Removed: Company’s commercial pricing practices with respect to the VA, and as part of the settlement, the Company paid the government $6.5 million.
See also Item 3, “Legal Proceedings.”
• The federal Health Insurance Portability and Accountability Act of 1996 (“ HIPAA ”) fraud and abuse provisions prohibit executing a scheme to defraud any healthcare benefit program, willfully obstructing a criminal investigation of a health care offense, or making false statements or concealing a material fact relating to payment for healthcare benefits, items or services.
−Removed: • While manufacturers of human cell and tissue products regulated solely under Section 361 are not subject to the federal Physician Payments Sunshine Act and its implementing regulations (together with the Act, the “ Sunshine Act ”), in the future, if we receive a BLA approval, this law will require us (with certain exceptions) to report information to CMS related to certain payments or other transfers of value we make to U.S.-licensed physicians and teaching hospitals, and for reports submitted on or after January 1, 2022, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists and certified nurse-midwives.
+Added: • While manufacturers of human cell and tissue products regulated solely under Section 361 are not subject to the federal Physician Payments Sunshine Act and its implementing regulations (together with the Act, the “ Sunshine Act ”), in the future, if we expand our product portfolio beyond those regulated solely under Section 361, this law will require us (with certain exceptions) to report information to CMS related to certain payments or other transfers of value we make to U.S.-licensed physicians and teaching hospitals, and for reports submitted on or after January 1, 2022, physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists and certified nurse-midwives.
If we receive a BLA approval, the Sunshine Act would also require us to report annually certain ownership and investment interests held by U.S.-licensed physicians and their immediate family members.
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There is a risk that CMS or another government agency may take the position that our products are not human cell and tissue products regulated solely under Section 361, and thereby assert that we are currently subject to the Sunshine Act, which could subject us to civil penalties and the administrative burden of having to comply with the law.
−Removed: see Item IA, Risk Factors, “ We and our sales representatives, whether employees or independent contractors, must comply with various federal and state anti-kickback, self-referral, false claims and similar laws, any breach of which could cause an adverse effect on our business, results of operations and financial condition.”
• Federal conflicts of interest laws, the Standards of Ethical Conduct for Employees of the Executive Branch, and local site policies for each federal institution we call upon govern our interactions with federal employees at our various government accounts ( e.g.
−Removed: , Department of Defense (“ DoD ”), VA, etc .) and impose a number of limitations on such interactions.
+Added: , DoD, VA, etc .) and impose a number of limitations on such interactions.
• There are state law equivalents of each of the above federal laws, such as anti-kickback and false claims laws, which may apply to items or services reimbursed by any third-party payer, including commercial insurers, many of which differ from each other in significant ways and often are not preempted by federal laws, thus complicating compliance efforts.
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Research and Development
−Removed: Our research and development group has extensive experience in developing products related to our field of interest, and works to design products that are intended to improve patient outcomes, simplify techniques, shorten procedures, reduce hospitalization and rehabilitation times and, as a result, reduce costs.
+Added: Our research and development group has extensive experience in developing products for our target markets, and works to design products that are intended to improve patient outcomes, simplify techniques, shorten procedures, reduce hospitalization and rehabilitation times and, as a result, reduce costs.
Our research and development group also works to establish scientific evidence in support of the use of our products.
Clinical trials that demonstrate the safety, efficacy and cost effectiveness of our products are key to obtaining broader third-party reimbursement for our products.
−Removed: In addition to our internal staff, we contract with outside labs and physicians who aid us in our research and development process.
+Added: In addition to our internal staff, we contract with outside laboratories and physicians who aid us in our research and development process.
See Part II, Item 7, below, for information regarding expenditures for research and development in each of the last three fiscal years.
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We contract with third parties for transport, treatment, and disposal of our biomedical waste.
−Removed: As of December 31, 2020, we had 735 employees.
+Added: Human Capital
+Added: As of December 31, 2021, we had 811 full time employees.
Generally, we consider our relationships with our employees to be good, and none of our employees are covered by a collective bargaining agreement.
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We strive to promote diversity, inclusion and equal opportunity across the organization.
−Removed: In 2020, we formed a Diversity and Inclusion Council with the goal of supporting strategic initiatives and practices to foster an inclusive & diverse organization in order to better serve our customers and their patients.
−Removed: With the appointment of Dr.
−Removed: Gardner to our Board effective upon the filing of this report, women and minorities hold a third of the seats on our Board of Directors, including the Chair of the Board.
−Removed: 54% of our employees are women, and women comprised 57% and 58% of our new hires in 2020 and 2021 respectively.
−Removed: Additionally, approximately 20% of our workforce identifies as Black or African American, 8% as Hispanic or Latino, and 4% as other non-White including American Indian, Alaskan Native, Asian, Native Hawaiian, or Other Pacific.
+Added: In 2020, we formed an Inclusion and Diversity Council with the goal of supporting strategic initiatives and practices to foster an inclusive, diverse and equitable organization in order to better serve our customers and their patients.
+Added: Women and minorities hold a third of the seats on our Board of Directors, including the Chair of the Board.
+Added: As of December 31, 2021, 55% of our employees are women, and women comprised 56% and 57% of our new hires in 2021 and 2020, respectively.
+Added: Additionally, as of December 31, 2021, approximately 22% of our workforce self-identifies as Black or African American, 7% as Hispanic or Latino, and 4% as other non-White (including American Indian, Alaskan Native, Asian, Native Hawaiian, or Other Pacific Islander).
We track turnover and retention for all employees.
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We have adopted specific measures and incentives to improve retention within the most affected organizational areas.
−Removed: The health of our workforce is important to us, particularly of our processing employees and other employees who, based on their specific job tasks and requirements, are not able to work remotely.
+Added: The health of our workforce is important to us, particularly that of our processing employees and other employees who, based on their specific job tasks and requirements, have not been able to work remotely during the ongoing COVID-19 pandemic.
We employ approximately 77 highly-trained employees in our processing area.
−Removed: While we process donated tissue using aseptic techniques in a controlled environment, the manufacturing space is a confined space in which an employee with COVID-19 may spread the virus to other employees despite the use of personal protective equipment required for all areas at MiMedx.
−Removed: To date, we have been successful in mitigating these risks through a variety of measures, including screening employees for COVID-19 prior to entering our facilities, implementing a number of safety protocols, and partnering with a testing facility to provide test kits and rapid results for employees that have symptoms or have a known risk of exposure, although there can be no assurance that we will continue to be effective.
+Added: While we process donated tissue using aseptic techniques in a controlled environment, the manufacturing space is a confined space in which an employee with COVID-19 may spread the virus to other employees despite the use of personal protective equipment in all required areas at MiMedx.
+Added: To date, we have been successful in mitigating these risks through a variety of measures, including screening employees for COVID-19 prior to entering our facilities at earlier stages of the pandemic, implementing a number of safety protocols, partnering with a testing facility to provide test kits and rapid results for employees that have symptoms or have a known risk of exposure, and supplying employees with appropriate personal protective equipment.
+Added: However, there can be no assurance that we will continue to be successful.
See Item 1A., Risk Factors, “ The COVID-19 pandemic and governmental and societal responses thereto have adversely affected our business, results of operations and financial condition, and the continuation of the pandemic or the outbreak of other health epidemics could harm our business, results of operations, and financial condition.”
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.