CDXC…Tru Niagen is Off to the Races

ChromaDex (CDXC) reported earnings yesterday. As expected, they lost money during this period where they are investing in the development of Tru Niagen as a potential blockbuster supplement. Looking beyond the bottom line, which is basically irrelevant at this stage, there are numerous reasons to be excited about the Company.

This excitement is being reflected in the shares of CDXC, which moved up before the earnings report and are continuing higher post the investor call which accompanied it. The shares are up over 25% in the last week or so, but we believe that’s just the tip of the iceberg.

Since I put out a note recently regarding their financing, with key investor ICONIQ, I’m not going to dig into that today. Instead, I’d like to focus on Niagen trends, including their own brand Tru Niagen, the key driver for revenue and profits as ChromaDex grows.

So, without further ado, here are my key takeaways from the earnings call. I expect to put out a more substantive piece in the coming weeks.

  • The scientific data supporting Niagen is growing by leaps and bounds
    • In September the Company released initial results from its second human study. These results confirmed Niagen significantly and sustainably raised NAD+ levels
    • Results will be submitted for publishing in a peer review by year-end…very important
    • IND for Cockayne’s to be submitted by year-end
    • Over 130 collaborative agreements in place…these should lead to additional clinical research and data
  • Niagen sales are growing and competition is dwindling
    • 7 competitive brands left in market, expect to be at 5 by year-end
    • Niagen revenue has increased Y/Y despite reducing supply in market
    • Some brands selling at 50% discount to Tru Niagen…that supply is running out soon
  • Tru Niagen is growing rapidly
    • Represented a majority of their Niagen sales for the first time
    • In 100 Watsons stores in HK, going to Macau and Singapore soon
    • Heavy investment in marketing in HK is paying off in sales
    • Growth of 30+% month over month the last 6 months
    • This has continued in October, which was up 30% over September
    • Expect new markets to open internationally in coming months

The tone of the call was bullish. The trends for Niagen, including clinical data and retail sales are bullish. Tru Niagen is off to the races. So are the shares of ChromaDex.

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