Business
MIMEDX Announces Strategic Realignment: Increases Focus on Wound & Surgical Business, Expected to Significantly Improve Profitability
Suspending Current Activities Associated with Knee Osteoarthritis Program and Disbanding Regenerative Medicine Business Unit Restructuring Expected to
About this update from Mimedx Group, Inc
[{"type":"text","content":"Suspending Current Activities Associated with Knee Osteoarthritis Program and Disbanding Regenerative Medicine Business Unit Restructuring Expected to Generate Approximately $25 Million in Annualized Savings Raising Expectations to Deliver Mid-Teens Percentage Net Sales Growth During 2023 Management to Host Conference Call Today at 5:30pm ET to Discuss Update MARIETTA, Ga., June 20, 2023 (GLOBE NEWSWIRE) -- MiMedx Group, Inc. (Nasdaq: MDXG) (“MIMEDX” or the “Company”) today announced a strategic realignment designed to focus the Company’s resources on accelerating growth of its Wound & Surgical business, driving profitability and enhancing cash flow generation. As part of this realignment, the Company is suspending all current activities associated with its Knee Osteoarthritis (“KOA”) program and is disbanding its Regenerative Medicine business unit, effective immediately. In connection with today’s announcement, Joseph Capper, MIMEDX Chief Executive Officer (\"CEO\"), provided the following comments: “After considerable analysis and deliberation, we have determined that it is in MIMEDX’s best interest to update our strategic priorities. Today’s announcement marks the beginning of a new era for MIMEDX – one in which we will be laser-focused on advancing our leadership position in the Wound & Surgical markets. The decision to suspend the KOA program had absolutely nothing to do with the safety or efficacy of our KOA product or our confidence in our team’s ability. “In consultation with experienced advisors, we conducted a thorough review of the relevant factors relating to the KOA market. When the analysis was complete, it was clear that due to changes in the market landscape, the inability to forecast with any precision multiple areas of risk, including regulatory uncertainty, combined with the opportunity cost of the significant capital requirements of the program, the decision to suspend KOA is right for MIMEDX. I want to recognize and thank the entire Regenerative Medicine team for their commitment and service to the Company. “We expect one-time wind down expenses to be approximately $5 million dollars. On a pro forma basis, assuming the realignment had occurred on January 1, 2023, we expect that it would have added approximately $25 million of Adjusted EBITDA1 for the full year 2023. Suffice it to say, this change will mater...