Medical company received a $10 million government loan 2 weeks after paying $6.5 million for allegedly overcharging the US for veteran's care
- MiMedx Group, a biopharmaceutical company, received $10 million from the government's Paycheck Protection Program two weeks after paying the government $6.5 million to resolve allegations it had been knowingly overcharging for medical supplies.
- Last year the company was also sued for exaggerating its revenue to investors. That case was settled and no fault was admitted. Two of its executives were also indicted on accounting fraud charges.
- Hilary Dixon, a MiMedx spokesperson, told The New York Times: "We don't have the option of raising capital in the public markets owing to our financial restatement process."
- The government's Paycheck Protection Program is a core part of the Trump administration's attempts to protect the economy from the impact of restrictions and social distancing.
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A biopharmaceutical company received $10 million from the government's Paycheck Protection Program two weeks after paying the government $6.5 million to resolve Justice Department allegations that it had been knowingly overcharging for medical supplies.
On April 6, MiMedx Group, which makes and sells human tissue grafts and is based in Georgia, agreed to pay $6.5 million to resolve a Justice Department investigation that alleged it had violated federal law by knowingly overcharging the Department of Veterans Affairs for medical supplies, according to The New York Times.
On April 21, two weeks later, it received a $10 million loan from the Paycheck Protection Program.
According to The New York Times report, MiMedx Group has paid the $6.5 million, meaning the government has effectively paid it back, and then some.
The government's Paycheck Protection Program is a core part of the Trump administration's attempts to protect the economy from the impact of coronavirus-related restrictions and social distancing. The program provides low-interest loans that will be forgiven if they're used to hire back laid-off workers. It was designed to save small businesses from going under.
Hilary Dixon, a MiMedx spokesperson, told The New York Times: "We don't have the option of raising capital in the public markets owing to our financial restatement process."
The company was sued last year by the Securities and Exchange Commission for exaggerating its revenue to investors over several years. The case was settled for $1.5 million, and no fault was admitted. Last year, two former top executives were also indicted on charges of accounting fraud.
This isn't the only loan under scrutiny. Last week, the national burger and fry chain Shake Shack was pressured into returning a $10 million loan it received from the program.
Business Insider's Tom LoBianco also reported that the biggest single recipient was a hotel chain run by the Dallas billionaire Monty Bennett. His companies received $58 million in loans.
These came a month after Bennett's companies hired two Trump fundraisers as lobbyists, and Bennett made a $50,000 donation to Trump's joint fundraising committee.