ChromaDex will sell about 5.6 million shares at $4.10 via the transaction, which includes venture capitalists and international strategic investors. The transaction is expected to close on Nov. 17.
ChromaDex’s 8K document filed with the SEC confirms that the lead investor is a fund called IconiQ, which Forbes magazine and Bloomberg News associate with Facebook founder and CEO Mark Zuckerberg. The other investors, according to ChromaDex CEO Frank Jaksch, are a group of Asian investors including some associated with Horizons Ventures, the investment firm of Hong Kong billionaire Li Ka-Shing.
Jaksch said the strong science behind ChromaDex’s flagship ingredient, Niagen, a branded form of nicotinamide riboside, is what is driving the investment interest. That, he said, and the anti-aging prospects for Tru Niagen, the company’s finished product brand.
“We have raised a considerable amount of capital in just the past six months,” Jaksch told NutraIngredients-USA. “It totals about $48 million.”
ChromaDex has received strategic investments in the past, including one from DSM Venturing in 2013. But the company’s real breakthrough on the funding side of the coin came just in April, when Li put in $25 million, structured in two tranches. That investment and the most current private placement share similar strategic goals, Jaksch said.
“Number one, we want to support the domestic expansion of Tru Niagen. Number two, we want to support the international expansion of the brand. And number 3, we want to continue to invest in R&D in developing other NAD+ precursors,” Jaksch said.
Boosting an ubiquitous co-enzyme
Niagen, or nicotinamide riboside, was discovered in 2004 by Dr Charles Brenner, PhD Head of Biochemistry and Professor of Internal Medicine at the University of Iowa (formerly of Dartmouth University). Brenner, who is now part of ChromaDex’s scientific advisory board after it licensed the ingredient in 2013, elucidated NR (a form of vitamin B3) as precursor of NAD+, or the oxidized form of nicotinamide adenine dinucleotide (NAD), a coenzyme found in all living cells, that has many functions in redox metabolism.
“It serves both as a critical coenzyme for enzymes that fuel reduction-oxidation reactions, carrying electrons from one reaction to another, and as a cosubstrate for other enzymes such as the sirtuins and poly(adenosine diphosphate–ribose) polymerases. Cellular NAD+ concentrations change during aging, and modulation of NAD+ usage or production can prolong both health span and life span. Here we review factors that regulate NAD+ and discuss how supplementation with NAD+ precursors may represent a new therapeutic opportunity for aging and its associated disorders, particularly neurodegenerative diseases,” according to an article in the magazine Science.
“Nicotinamide riboside, or NR, was our first NAD precursor. But there are other NAD precursors in the pipeline. NR just happens to be the first. We want to be among the leaders when it comes to NAD science,” he said.
Jaksch said the prospects are bright for Tru Niagen, especially in Asia, where in China alone there will shortly be more than 300 million consumers of an age group to benefit from the supplement. But he said there is a lot of work to do to support the brand.
“We had a very successful launch of Tru Niagen with Watsons (one of Li’s ventures) in Hong Kong in September,” Jaksch said. “But when you go into new international markets there is a lot of work you have to do on the regulatory front with a new product based on a new ingredient like NR.”