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ChromaDex Corporation Message Board

  • investora2z investora2z Mar 3, 2013 7:19 AM Flag

    The recent $6 million deal

    The BluScience range, which was sold to Nutri Sci for a $6M deal a few days back, contains pTeroPure (pterostilbene) (CDXC's proprietary patented product). This ingredient has been found useful in reducing blood pressure. This segment has a market size of around $600M and if NutriSci can garner a decent market share (especially in SE Asian markets), it would be significant for Chromadex. This is because it would receive royalty payments from NutriSci and also earn revenue from the raw material purchased by Nutri from it for production. The product can also be used in other indications like memory improvement, anxiety and neuro-protection which only enhances the potential of the product. The deal will translate into a positive impact on the balance sheet. This is because, with around 93M outstanding shares, a positive impact of $6M (even if it is not all revenue) will help the stock strengthen even if a nominal P/E ratio is considered. $250K is already in the kitty (the initial amount received at the time of signing) and by 31st March, the full impact of the deal may be measurable. In addition, Chromadex has potential candidates like C3G and nicotinamide riboside which are expected to generate revenue in the near future. They would help it tap the potential of other market segments. Recently, the financial performance of the company has been better. In the third quarter the sales doubled and the net loss (excluding non-cash items) declined by more than 85%. Even if these items are factored, the net loss for Q3 came down from $2.4M in Q3'11 to $1.53M in Q3'12. Insiders, who are holding 43.7% of the company stock, are expected to become more confident of the future after the recent deal. The stock has already beaten the S&P over the last 12 months with a return of more than 17% compared with less than 12% for the index.

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