(Reuters) – MiMedx Group said on Friday it had received a warning letter from the U.S. Food and Drug Administration related to the classification of its placental-derived tissue product Axiofill, and its shares fell 7% after the bell.
MiMedx said the letter, which it received last week, was not related to a safety issue.
Axiofill, a human placental-derived product, was launched in September last year for surgical recovery procedures.
FDA asserted the production of Axiofill involves more than “minimal manipulation”, the company said. It said it disagrees with the health regulator’s stance.
Following a routine inspection this year, the FDA found Axiofill does not fall under Section 361 of the U.S. Public Health Service Act. Instead, the regulator said Axiofill should be under Section 351, which regulates products as biologics that require premarket approval. Human tissues, in contrast, are regulated under section 361, where the primary safety concern is infectious disease transmission.
MiMedx said the product was developed and is manufactured to comply with the requirements of section 361. It is used to “replace or supplement damaged or inadequate integumental tissue”, it said.
Axiofill, is expected to generate less than 5% of the company’s total net sales anticipated for 2023.
The company said it has been working with the FDA and will provide updates regarding the matter in late-February.
(Reporting by Sriparna Roy in Bengaluru; Editing by Shounak Dasgupta and David Gregorio)
