Company Returns $10 Million in Taxpayer Funds Intended for Small Businesses in Response to Select Subcommittee Inquiry
Washington, D.C. (May 11, 2020)—Today, Rep. James E. Clyburn, the Chairman of the Select Subcommittee on the Coronavirus Crisis, issued the following statement after MiMedx Group, Inc. returned $10 million in taxpayer funds appropriated by Congress to help small businesses combating the coronavirus crisis:
“Congress created the Paycheck Protection Program with strong bipartisan support to help small businesses that otherwise might be forced to lay off workers or shut down as a result of the coronavirus crisis. Our goal is to ensure that this taxpayer money reaches small businesses truly in need rather than large corporations with a substantial investor base and access to capital markets. Our actions have already resulted in the return of $10 million in taxpayer funds—five times our entire budget for the year—which is exactly why we were created in the model of the Truman Committee during World War II. We will continue to protect the health and safety of the American people and ensure that taxpayer dollars are spent efficiently, effectively, and equitably.”
On May 8, 2020, the Select Subcommittee sent a letter to MiMedx and four other companies, noting that both Democrats and Republicans have expressed concern about large companies receiving funds through the Paycheck Protection Program (PPP) meant for small businesses and asking the company to return the funds it received.
MiMedx had announced on April 21, 2020, that it received $10 million under the PPP. Two weeks earlier, MiMedx had agreed to pay $6.5 million to resolve an investigation by the Department of Justice into allegations that the company “violated the False Claims Act by knowingly submitting false commercial pricing disclosures to the United States Department of Veterans Affairs.”
Today, the company sent a letter notifying the Select Subcommittee that it has now “repaid the PPP loan received.”
The Select Subcommittee sent letters to companies that (1) are public; (2) have market capitalization of more than $25 million; (3) have more than 600 employees; and (4) sought and received “small business” loans of $10 million or more. The panel asked the companies to inform them if they will return these funds and, if not, to produce a range of documents. These inquiries are ongoing, and the Select Subcommittee is working with each company in response to this request.