MiMedx Sells Upper Extremities Business
ATLANTA--(BUSINESS WIRE)--MiMedx Group, Inc. announced today that it has sold the assets of its upper extremities business, LeveL Orthopedics, in separate transactions valued at over $1 million. The majority of the assets were sold to UPex Holdings, LLC (“UPex”), a design and distribution company that focuses on upper extremity orthopedic products. UPex purchased eight patent applications and the related intellectual property for $300,000 cash, a $100,000 promissory note, and up to $630,000 in royalty obligations. Two provisional patent applications and the related intellectual property were sold to the primary inventor, Dr. Thomas Graham, in a separate transaction in September.
Parker H. ‘Pete’ Petit, Chairman and CEO of MiMedx Group, said, “Over the course of the past six months we refined our corporate strategy to focus on bringing our innovative biomaterial technologies to market; therefore, we made the decision to divest the assets of our LeveL Orthopedics division, which is focused on technology for the upper extremities market. This was a difficult decision because we believe the LeveL technology will garner a significant market position once the product line is fully developed. That said, our management and board believe it is critical for us to focus our resources on our biomaterials.”
The sale process was led by Scott Chesky of the Maren Group, an investment banking firm with strong expertise in healthcare, and Bill Taylor, who was recently appointed as MiMedx Group President and Chief Operating Officer. Regarding the sale, Taylor said, “Not only will the LeveL sale enable MiMedx Group to focus on our biomaterial platform strategy, but by finding a new home for the technology in UPex, I believe that surgeons and patients will soon enjoy the benefits of the innovations embodied in the LeveL intellectual property.” Regarding his recent appointment as the Company’s President and Chief Operating officer, Taylor commented, “MiMedx has some incredibly talented people and two phenomenal platform technologies that have great market potential, and I am honored to be a part of this organization.”
With respect to the Company’s remaining business assets, Petit said, “Our transition from a development company to an operating company continues as planned and is nearly complete. We expect our first product sales before the end of this year. We have strengthened our board of directors and our management team, and we are well positioned to take these innovative technologies into the market place.”
About MiMedx Group, Inc.
MiMedx Group, Inc. is an integrated developer, manufacturer and marketer of patent protected biomaterial-based products and is in the process of transitioning from a development-focused concern to an operating company focused on sales growth and profitability. The Company’s assets include intellectual property protecting a collagen-based technology for augmentation of soft- and connective-tissue diseases and trauma and intellectual property protecting a novel durable hydrogel technology. The Company has received FDA clearance for its first durable hydrogel product, the Paradis Vaso Shield™, indicated for use as a cover for vessels following anterior spinal surgery.
Important Note regarding forward-looking statements and risk factors. This press release includes statements that look forward in time or that express management’s beliefs, expectations or hopes. Such statements are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include those regarding the amount of royalties to be received from the sale of the LeveL assets, the Company’s ability to transition from a development company to an operating company and successfully bring its biomaterials technologies to market, and the prospect for product sales by year end. These risks and uncertainties include that the royalties are based on future revenues derived from the LeveL technology, which may be lower than anticipated, that the Company currently requires substantial additional capital to survive and achieve its goals, which may be difficult or impossible to obtain, that the Company may not receive requisite regulatory clearances/ and or approvals to be able to market a full range of products or that such clearances or approvals may be delayed, that the Company many not be able to establish an effective distribution system for its products and that the Company’s products may not gain acceptance in the marketplace. The risks and uncertainties also include the risk factors detailed in its Securities and Exchange Commission filings, including, without limitation, its 10-K filing for the fiscal year ended March 31, 2009, and its most recent Form 10-Q filed on August 7, 2009. The Company does not undertake to update its forward-looking statements.
MiMedx Group, Inc. Michael J. Culumber, Chief Financial Officer, 813-866-0000