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Petit Back, New Role with MiMedx Group

Atlanta Business Chronicle - by Urvaksh Karkaria, Staff Writer

Friday, September 11, 2009

An inability to stay retired was one reason Parker "Pete" Petit took over the wheel at orthopedic and spine implant maker MiMedx Group Inc.

A serial entrepreneur, Petit launched Healthdyne and later ran its subsidiary, Matria Healthcare Inc. Less than a year after selling Matria to Inverness Medical Innovations Inc. (NYSE: IMA) for $900 million, Petit is back in the catbird seat.

"It seems like I'm not good at retiring," Petit said late Thursday afternoon. "I missed the interaction with my management teams."

MiMedx is developing biomaterial-based products for use in the musculoskeletal specialties, based on technology from Georgia Tech and the University of South Florida.

The company, which went public through a reverse merger in February 2008, holds exclusive rights to eight issued and 33 pending U.S. and foreign patent applications, according to documents filed with the Securities and Exchange Commission.

MiMedx holds a license for a polyvinyl alcohol (PVA) polymer that may be used to treat damaged soft-tissue trauma and disease in the spine and as a barrier for scar-tissue formation after surgery.

The company is also developing a proprietary collagen-based fiber that act as platforms or "scaffolds" on which a patient's tissue grows during the healing process to achieve healthy tissue reconstruction without major scarring.

MiMedx was launched by serial entrepreneur Steve Gorlin. Petit, a major investor in the company, took over as chairman president and CEO in February.

Gorlin is a "consummate medical entrepreneur, but he doesn't run companies," Petit said.

Petit said he was attracted to MiMedx because of its technology and people.

"There's some very excellent scientists and technologists involved," he said.

Petit is no stranger to the medical device business. But MiMedx will be his first foray into the orthopedics implant business.

"I've had to learn a new language and converse with a different set of physicians," Petit said. "I know the processes. Being an old chemical engineer, I know the science associated with the product well. Those things I don't lose any sleep over."

Petit hopes to steer MiMedx from pre-revenue to profitability by the end of 2011. The company expects annual earnings of about $7.2 million on net revenue of about $36 million in 2012, according to SEC filings.

The PVA product, which has received FDA clearance, will be marketed nationally this fall, Petit said. The collagen-based product is expected to hit the market in the second quarter of 2010.

Petit expects the workforce to triple about 135 in the next couple of years, as product hits the market. The new jobs will include research, production and sales jobs.

Raising capital remains the biggest challenge for an early stage firm such as MiMedx.

Wealthy Americans, who generally invest in early stage companies, have watched their investment portfolios take a hit in the volatile stock market. Petit said. Venture capital funds, meanwhile have gotten conservative and are steering clear from investing in early stage.

Despite the tough fund raising climate, MiMedx raised about $4 million in early summer. That financing, from angel investors in Atlanta and around the country, will be used for product development, Petit said.