MiMedx Halloween Special – Viceroy evidence more PODs and channel stuffing of deceased doctors.

Part 14 – Halloween Special

Viceroy have discovered legal proceedings against MiMedx vendor RedMed for their alleged role in a kickback scheme and False Claims act violations. In addition to this Redmed’s principal Jeff Hannes is also involved with several other Physician Owned/related Distributors (PODs).

Viceroy will also highlight MiMedx sales to another POD whose physician is no longer alive and the LLC deregistered.

Viceroy will release details of further PODs shortly.

Happy Halloween.

“The same thing happened at Matria”

Pete Petit would like us to examine his track record of running public companies. We find that Pete and his close-knit board & management has a tendency to run them into the ground.

Part 13 – The same thing happened at Matria
This report concerns MiMedx directors Parker “Pete” H Petit, Debbie Dean and Joseph “Joe” G Bleser and their previous positions at other Petit companies; Healthdyne Inc., Healthdyne Information Enterprises (HIE), Healthdyne Maternity Management (HMM) and Matria Healthcare.
The events detailed in this report resulted in a catastrophic collapse of Matria’s share price due to earnings downgrades and revision of future performance.

 

MiMedx: Palmer-geddon

MiMedx employee Ricky Palmer worked as distributor for MiMedx customer, selling to the Department of Veterans Affairs and the Department of the Army.

This report concerns MiMedx employee Ricky Palmer and his position at a MiMedx distributor Southwest Medical Systems Inc while simultaneously being employed at MiMedx.

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Viceroy also addresses major discrepancies in MiMedx’s latest “commentary” piece. Specifically, MiMedx claim its “sales agents” do not “distribute” MiMedx supplies:

Short CommentaryThis statement directly contradicts FDA records suggesting many agents in MiMedx’s 2016 sales report both store and distribute inventory.

 

MiMedx 2016 Ortho Sales Reports: Read ‘em & weep

Viceroy releases MiMedx sales records that directly contradict company statements. MiMedx, which department will Viceroy expose next?

Part 11 MiMedx Ortho Sales Report

MiMedx has increasingly come under pressure from both analysts and short sellers over the past month. The market is waking up to find MiMedx’s closet of skeletons quickly spilling open. Dubious hiring practices, physician owned distributors, employee owned distributors and poor corporate governance are all coming into focus. The spectre of action by the United States Department of Justice, Office of the inspector General of Veteran’s Affairs and the Securities and Exchanges Commission now hangs over the company.

Viceroy has obtained documents from former MiMedx employees detailing sales targets and historical figures broken down by distributor. The information directly contradicts statements made by MiMedx. Viceroy believes that MiMedx has systematically and deliberately misled investors and stakeholders and has forwarded this information to the relevant authorities.

 

MiMedx: Up Schmidt Creek

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This report is concerned with the creation of Physician Owned/Related Distributors (henceforth PODs). The potential for fraud is well documented as evidenced by the release of the special fraud alert by the Office of the Inspector General of the Department of Health and Human Services:

https://oig.hhs.gov/fraud/docs/alertsandbulletins/2013/pod_special_fraud_alert.pdf

We previously highlighted the activities Donovan Schmidt, MiMedx Market Development Manager available here:

https://viceroyresearch.org/2017/10/03/mimedxs-selective-non-compete-litigation-questionable-disclosures/   

We now evidence MiMedx employee Donovan Schmidt’s active involvement in the premediated formation of a physician owned/related distributor (POD) with a prominent Atlanta physician.

“There is a MiMedx employee his name is Donovan Schmidt, he is an employee and also a distributor and also worked for Orthofix.” – Former MiMedx Employee

More physician owned distributors – MiMedx may not wish to address its investors but it will have to answer the regulators

Viceroy is releasing more on illegal physician owned distributors (PODs) operating in the wound care space within the state of Texas. Our spreadsheet will follow shortly to expose multi state PODS and conflicts.

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Given the large proportion of income derived from Texas sales, investors should be concerned, especially as the numerous, undeniable, illegal PODs we illustrated on our report dated October 13, 2017 have not been addressed by management.

MiMedx’s blanket denial of Viceroy’s report and aversion to conducting an investigation suggest that management are either fully aware of these illegal distributors, or have been negligent in their duties…

MiMedx is not operating in an industry where these abuses are commonplace, and yet within the single state of Texas, we have connected MiMedx with:

  • Numerous illegal PODs;
  • Numerous related party distributors; and
  • Forest Park Medical Center, a $40m fraud uncovered by the DOJ and FBI.

Malfeasance by Physician Owned Distributors and kickbacks are an abuse of the healthcare system. The abuse not only costs patients and insurers, but ultimately undermines the integrity of physicians where products are prescribed to enrich suppliers (namely MiMedx) and enable Physician’s to obtain a kickback in reward.

This report further details connections between MiMedx and its network of physician owned distributors. This network of distributorships owned by employees and physicians allows MiMedx to engaged in large scale channel stuffing activities. The benefit to the physicians and employees comes at a cost to insurers and the medical facilities who ultimately pay the costs.

Lou Roselli made the headlines once more last week as an incriminating email surfaced where Lou admits MiMedx cannot reconcile inventory to federal customers. In the tissues business, this is strictly against the law.

Given the substantive evidence presented in our reports, we call on the board of MiMedx launch an immediate external investigation into the conduct of Senior Personnel, and subsequently resign.

The structure of these distributors leaves open great opportunities to exploit the US healthcare system. As a reminder to our readers, the Office of the Inspector General of the Department of Health and Human Services issued a special fraud warning stating that such ventures “should be closely scrutinized under the fraud and abuse laws.”

Bankruptcy & DOJ/FBI indictments of Physician Owned Medical Center inconvenienced MiMedx CPM channel stuffing program

This report focuses on commercial relationships with currently indicted individuals for fraud with direct trading links with MiMedx and a Physician Owned Distributors in Texas with more to come.

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In this report, we detail exactly what MiMedx management withheld about its relationship with CPM Medical & unquestionably evidence physician owned distributors that have sold & are selling MiMedx products, with full references & FDA evidence. MiMedx’s channel stuffing distributor, CPM Medical, defaulted on its credit terms due to a DOJ/FBI crackdown on a key client, Forest Park Medical Center – a convicted $40M fraudulent kickback scheme.

Viceroy also present indisputable FDA evidence that MiMedx was specifically trading with physician’s spouses – via physician owned/related distributors registered to store MiMedx products ONLY.