GMP compliance is a 'huge opportunity' for dietary supplements market: Chromadex CEO

By Stephen Daniells in Irvine, CA

- Last updated on GMT

Frank Jaksch, CEO of Chromadex
Frank Jaksch, CEO of Chromadex

Related tags: Nicotinamide adenine dinucleotide, Niacin, Frank jaksch

FDA enforcement of the current good manufacturing practices (cGMP) regulations is ‘a huge opportunity for the dietary supplements market’, says Frank Jaksch, CEO of Chromadex.

“Companies that are going to comply will be competing for a bigger share of a growing market,”​ Jaksch told NutraIngredients-USA at Chromadex’s Irvine, CA offices.

“There will be attrition in the market place, and that will not just be enforcement-related,”​ he said. “We’ll see more and more companies gobbling up others.

“There are also opportunities in M&A. The activity in M&A is happening because of the increase in the perception of this space. I expect M&A to heat up, and I expect enforcement to heat up.

“There will be a reduced population of companies out there. From an investor standpoint, it sounds like a good deal to me!

“It is going to be hard for the smaller companies to survive, because investing in quality systems is expensive.”


Chromadex is now getting into the GMP and regulatory consulting business, following its acquisition of Spherix Consulting in December 2012​.

“Look at how long we all had to get compliant,”​ said Jaksch. “There is a reasonable population of companies that are woefully deficient at meeting the requirements.​”

Articles in the Chicago Tribune​ last year had FDA officials reportedly citing violations in 50% of the 450 firms inspected over the last four years. Such statistics were questioned by the trade associations, but Jaksch said that such figures are “not entirely unexpected because just look at pharmaceutical companies and how long it took them to comply.”

So why the problems? “A lot of consultants were giving bad advice,”​ said Jaksch. “GMPs are GMPs, but it’s challenging because customers are only willing to pay for so much QA, QC, certification and verification.

“That’s now changing because of enforcement, and it’s definitely an involuntary response.”

“What’s shocking to me is not the amount of warning letters. What’s shocking is the consistent level of deficiency we’re seeing.”

Indications are that the FDA is stepping up its scrutiny with each passing year, and this, said Jaksch, is normal.

“It’s shouldn’t be a shocker that three years ago a company had no problems, but now there are problems. FDA is increasing the level of scrutiny.

“The good news is that companies are now coming to us and asking the right questions. Companies understand what they need to do, and even if a company is not 100% compliant, they have a plan to be 100% compliant.”

Compliance will not be overnight, and companies need to adopt a realistic timeline and a plan, and that may take two or three years.

But what if FDA arrives next week, and finds a company lacking? “My stance is this,”​ he said, “if the Agency is running through the rap sheet, the 483, and the company can respond with ‘we know we are not compliant, but this is what we are going to do to fix it and this is the timeline’, then is the Agency going to pursue them? FDA may want them to speed up the timeline.

“Some companies are starting to do this, and that’s a good sign.”


While Chromadex itself was active in the M&A area, snapping up Spherix Consulting, it also sold off its BluScience retail supplement line to Canadian marketing firm NeutriSci International.

So why divest? “We created a line of five products on one ingredient [pTeroPure, Chromadex’s branded form of synthetically-produced pterostilbene],”​ said Jaksch. “We never thought it would take off the way it did.”

“We took a science-backed approach to a retail product, and the scientific story connected with retailers. GNC loved it, and very soon Walgreens wanted it, as did RiteAid, CVS, Walmart, and Target.”

At last count, the products could be found in more than 15,000 retail outlets.

“When you have that level of success, it can be difficult. We were at a cross roads. We either go all in as CPG or we dial back.”

While they dialed back, the lessons learned developing pTeroPure and the BluScience range will stand the company in good stead, and Chromadex will employ a similar strategy in the future where it creates a brand from a conceptual standpoint around other new ingredients it has. 

“The value of Chromade is the R&D. The legacy business generates market intelligence, and we have a very efficient model for finding cool stuff.”

Next up could be the nicotinamide riboside (NR) - a next generation version of vitamin B3 (niacin) claimed to help protect the brain, help with weight management and improve blood glucose control.

The company has already secured exclusive rights to multiple NR-related patents from Dartmouth College covering applications and methods to produce NR via fermentation of engineered yeast strains.

A vitamin found naturally in milk, NR is a more potent version of niacin and a precursor to nicotinamide adenine dinucleotide (NAD), increased cellular levels of which confer multiple health benefits, he said.

“The health benefits of NR are substantial,”​ he said, and include anti-aging. “Nicotinamide riboside is an unbelievable compound.”

Related topics: Suppliers, GMPs, QA & QC

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