MiMedx, a fast-growing tissue-graft developer, has financial ties to more than 20 doctors, according to a review of doctors’ disclosures by The Wall Street Journal, but the company hasn’t reported these payments to the government under a 2013 law.
The company says its products, made from donated placental tissue, aren’t among those that require a disclosure of doctor payments. At least one of MiMedx’s MDXG, +3.43% direct competitors, Osiris Therapeutics Inc. OSIR, +6.67% , regularly provides information on its ties to doctors and reported $1.03 million in such payments in 2016.
MiMedx announced Tuesday that its board had engaged independent advisers to review its sales practices. News of the review, and that MiMedx was delaying the release of its 2017 financial results, caused the company’s shares to fall 40% in one trading day.
Shortsellers have accused MiMedx of engaging in improper sales tactics to meet quarterly earnings forecasts, allegations the company has repeatedly denied. MiMedx, whose products are used in wound care and surgical procedures, was named the fifth-fastest growing public company in the country by Fortune magazine late last year.
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