Earnings call transcript Q4 2022

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to ChromaDex Corporation's Fourth Quarter 2022 Earnings Conference Call. My name is Julian, and I will be your conference operator today. At this time all participants are in a listen-only mode. And as a reminder, this conference call is being recorded. This afternoon, ChromaDex issued a news release announcing the company's financial results for the fourth quarter of 2022.

reviewed section both www.chromadex.com. of not the available have Relations Investor ChromaDex' you this are information, within If website at

would Agency turn Tom to Shumaker. Please now call Mr. I to over go the ahead Shumaker, Counsel IR conference Advisors, for ChromaDex. LifeSci like

Tom Shumaker

and results Chief Brianna Good you. Scientific Executive join Shao, President Fried; Financial Officer, XXXX Officer, and Andrew welcome With Senior us of Corporation's fourth to Q&A. Rob Affairs, Thank call. ChromaDex today Gerber; who Vice call and the quarter afternoon Dr. investor Regulatory are ChromaDex's Chief will for

Today's including plans, new results the Tru business and research and ChromaDex's include of such results; conference trial and operations. in interest; the financial expansion and future performance; timing timing anticipated of prospects and may filings; needs; of results forward-looking statements related business opportunities; as regulatory of the clinical trials; of statements, development cash and well the to sale development operating opportunities; as investor markets; future Niagen

the statements could to actual forward-looking Company estimates have call its statements, date the flows. well business, risk and forward-looking expectations. in to factors as operations, forward-looking to and include that subject assumes economic after most condition in and these are pandemic in effect These with statements. the with date relate the the the inflationary ChromaDex's anticipated statements forward-looking actual actual filed materially occurred, call SEC, inherently activities to intended yet future those conference the adverse no activities recently as company's that the the XX-K our of cash any to give financial to results annual to from or statements on results changes update only are uncertainties. conform on not note cause on conference including results. and to matters COVID-XX this Many any differ risks obligation of conditions this of results Form report Because factors as of ChromaDex's or and not results Forward-looking represent assurance statements Please contained

the information references non-GAAP The and this the and release, call In earnings which financial are presented reconciliations financial in issued were company's press certain presentation earnings available to afternoon addition, measures. of presents company's website, appropriate the on measures. GAAP this

webcast. Finally, available will via at call of being Investor section recorded The Relations www.chromadex.com. this be conference is the our website webcast at

Officer, to pleasure to Fried. my call turn Executive Chief Rob? our it's that, With Rob over the

Rob Fried

compensation challenging frugality defined adjusted believe profitability important much joining it we prioritize given is $XXX,XXX Thank but XXXX, quarterly investor ever you, at $XX severance, Furthermore, achieved and the I'm Tom. today's very times, for well Good of as we delivered promised, EBITDA, positive sequentially. EBITDA our to with as is as important. the growth million, quarter for to fourth year-over-year us in revenue be call report you today. on It's pleased XX% afternoon best thank good XX% our all again. everyone, and for macroeconomic approximately and to that without up share-based of you as particularly quarter. environment, We enterprises

We Niagen a especially turbulent that precursors, can Tru quality protected of Niagen NAD times. have and a brand portfolio trusted endure in

fast upfront indeed last with long-term a fourth $X supply Science, reporting call, on is agreement based researched, Niagen events formulations including Nestle of briefed their strong our that sell product earnings On NAD The to period, most included in safest, signing occurred an best purchase. in multi-ingredient in the rights major which amended expanded on million quarter the Tru Health growing Niagen the and brand is the It we market the and truth. the marketplace. science in

Sinopharm operating the Xingsha entity a the We Asia Tru formed penetration region. working Niagen's venture, our with that ChromaDex China broadened is joint also in in that

as these have half Alongside year, year XXXX. and period. shortly, will ChromaDex ended continue very the net into and no we second collectively promotion investors in provide debt. this of Nestle to million $XX CFO, approximately grateful which the down sales of but with her $X.X marketing detailed are year of Brianna million strategic compared coincided was quarter of with net and discipline percent improved XX% events, over will cash and approximately fees We selling a existing operating of our in management to as we and the in confidence. invested dramatically in expenses ago our for XX% two to Fourth major the this vote financials

that expense Legal as trend well. the year throughout evident was was significantly lower, a

able with approximately As combination we've quarter was in also build from $XXX,XXX last upon down a behind that long-term and and continue the noted NR to year-over-year. exclusively. were In of which that property us I shareholder largely existing in who patents said, letter year, last new to in to we the letter, portfolio, extensive series W.R. patents our Grace, which month. shareholders fourth and obtain critical we ChromaDex my protect was G&A supplies cited to litigation intellectual IP is

NR protect recently least expect and of various to for Two NR the at next ChromaDex' granted patents We methods of salt protect years. XX making forms.

a the NR important crystal NRT. previously NRMCl of chloride, covers of form NR patent covers chloride, production NRT of in patent form NRMCl, final a intermediates a granted ingredient triacetate NR in Chloride. the XXXX, granted recently while and Third methanolate crystal are

in back got has financial our quarter. due our spend. acquisition in these and our scaling to some Tru decline objective and our part brand, a the There changed growing to improvements, important website Despite fourth sales direct We in trusted global building primary keep was challenges strategic not Niagen. do

the articles revamping of to X% our design customer with from were website a inaccurate article our university an We rating press PR. and functionality This that published strategy. this due Altmetric this an research piece for according NR by resulting the attention quite attempting misleading proud addressing by optimizing but impacted and release. also am are the by ChromaDex I to and to team in measures associate We kind cancer. acquisition is how its misleading top responded release of This media university studies, the to from of press coverage of sensationalist

and Board no large that Scientific responded by correlation. of employees such the scientific Advisory ChromaDex research The the body quickly shows emphasizing

also university's the clickbait. widespread research We study one authors, of as the appreciated support of from publicly own the the very this community, study's denounced including who coverage

preventative. the general XX Niagen's majority more past data important on revenues highlight consistent revenue in where vitamin that up of with and Numerous also from Watson's quite the of that that be we outlook shown In year studies at we'll ended in year-over-year, the a studies were sales is over safe, challenging it the fact, An has dose published China full NR the levels fourth along Tru macro its the but now high be safety years. provide COVID may NR of to cancer shows over was XXXX Watson's DX appropriately optimistic, sales in conservative zero policy. growth XX% will quarter are Brianna see have environment.

However, this new close have possibility additional significantly see for have years could we of on as and we several additional that growth. the partners, Innovations to potential, growth year. from upside are realistic and is there a we upside for worked I that greater new opportunities could and see channels landscape commercialization new look we at products,

significant month. a event in first for planned to have we impact on have might pay This quarter, we awareness an this brand event the expect this off significantly scheduled but during EBITDA that First, year.

NMN sale will of decision that FDA's to marketing We ban benefit recent also Niagen. and the the believe Tru

to of many in With U.S. traction, we are decision, but are as than recently sold But selling and sold no first labeled the cannot republished supplement companies are by was or gained investigated a NMN since be dietary no on a of players. and all. which less number superior ChromaDex products large it dietary U.S. had by NMN the was the although study Amazon ConsumerLab.com, supplement NMN as conducted primary drug. at There FDA's XX% is a to as NMN NMN accurately NMN smaller of NMN aware a according in Niagen NAD precursor, has legally an marketed

Just patented proprietary or to to be FDA apply this riboside, our not nicotinamide NR, to clear, ban does NMN Niagen. decision ingredient,

behind is of the company truly there until of clinical an now six have value of you studies, to When is ingredient. as executive years indeed assess peer-reviewed XX results joined data, have nearly is the this the research I Speaking of exceeded the ago, hard studies science remarkable. Niagen. like body of and cumulative our it special but a that was an Niagen, proving impressive Results clinical our preclinical expectations published ingredient

ingredient more to with our broadly, link industry. of SERP, to support advance health understanding of applications our it's this product, not as the benefit consumer beyond a is it but supplement subjected potential claims for Speaking

systemic mechanistically fluid. results NR spinal blood-brain and disorders. excited inflammation, example, it penetrates see reduces cerebral And we supplementation we when such, an that the important not are As surprised patients as positive for understand we inflammation neurological of the with barrier but in NR reduces

next-generation company as than in pharmaceutical brain on supplementation in not neurodegenerative well scientific largely deep more which study the clinical this the an disease the at XX do the in NAD+ of a I and that property pipeline arena, the ChromaDex. dietary does another biomarkers. Aging journal significantly focus like may value highlight value of the as published increased has peer-reviewed ChromaDex, therapeutic significant NAD Recently, as precursors studies largely found that oral Cell have or that that supplement Studies is ongoing innovation expertise NR impacted and levels today. portfolio intellectual untapped of know states positively prophylactic

Brianna for I then Thank and the to to would all in quarter's and onto now attention. it's you call yours. more Brianna turn remarks. results your closing the Q&A like to discuss over detail

Brianna Gerber

Thank we have year you, financial investors, full outlook ChromaDex latest our metrics, reduction targeted us our and Rob. in who today. expense. joined to across all pleasure to exceeded partners delivered employees, to on speak G&A XXXX and investors our It's a

increase, million growth expense XXX in to year supply of strength the a significant $XX our year-over-year inflationary decline. For as full XX.X% and navigated as in expense administrative percentage business X% $X of $X sales including million net the margins than a of a delivered year-over-year million. reflecting decrease of $X across basis million, global Selling Gross R&D general of And model we our and increase outlook points million chains. a E-commerce. An approximately of X% down sales. total $X.X pressures we marketing better of expense in net

million metric, business of full by measured non-GAAP $XX.X a a underlying adjusted loss year as compared of to full year for The million EBITDA, loss a posted XXXX. $XX

We to GAAP slide. reconciliation have our measure release provided earnings appropriate the in a

this, discontinue the assess EBITDA we delivered believe adjusted metric we decided as legal forward, to is the the our adjusted Going quarter, underscore have to performance. providing current company. in EBITDA underlying fourth million expense suitable excluding adjusted a total $X.X positive we for significant To of EBITDA, more milestone

our remains growth results an a to who looking important to Balanced as committed our objective, amazing have team ChromaDex at stand our and business differently. testament

we beyond. to and continue have forward, optimize lasting impact underway a which larger have XXXX Moving will initiatives the in to business,

turn quarter a let's quarter. the to delivered gross from sales, total net the financials. solid net $XX year-over-year, year net XX% a XX.X% a XX.X% significant that, and fourth selling prior sales of up of With in margin improvement the sales with quarter XXXX marketing of expense million of ChromaDex of XX.X% of

quarter. The underlying posted an year adjusted of million $X.X in improvement non-GAAP of $X.X by profit EBITDA, million the quarter, the metrics, from fourth a prior business measured as a

total compared Watsons with XX% growth to the and Tru fourth P&L combined sales year-over-year and sales of including Niagen sales. BXB XXXX, quarter were flat in Moving XX% in said, I E-commerce, the growth as up other details, to in net XX%

up well encouraging sell China, listed also due tourism. catch driven a Kong by the of They improvement as quarters. Hong have through timing as restrictions were from in recent have some return sales in in Watsons’ COVID-XX to earlier shipment seen been as

versus captured As our cross-border sales last with these China E-commerce BXB model sales I to Tru in wholesale are Sinopharm sales platforms direct previously. mentioned were quarter, captured agreement due previously on in that now Niagen other

due largely of part of an the from Niagen Science, ingredient as upfront $X agreement. minimum year-over-year, purchase amended Nestlé Health to supply sales were net up newly XX% million

closer well a was The margins more year and higher points lag. P&L to supply fourth basis In we anticipate inflationary pronounced XXXX, Gross margin to to the inflationary mix contending trending as impact in margin XXXX. XXXX are percentage normalizes, chain is XX.X% as wages in the attributable in chain, headcounts, decline which mix, of but declined still in gross business XXX supply compared with business pressures XX.X% quarter. full the increases to other pressures the that by including we with our across as quarter gross fourth

basis to of highest a to campaigns third points XX.X% on and expense declined channels the to on Selling the focus quarter fourth with spend compared a X,XXX XXXX, and strong on marketing in and term in net as pivoted quarter of XX.X% as distribution return we conversion sales investment marketing the XXXX. short beginning of percentage

quarter, fourth customer CPA costs year-over-year. by our the In XX% or declined acquisition

to primarily million. reported, As general decreased $X.X expense by lower administrative due of expense $X.X and million, legal

in loss by our million and as our growth the improved $X.X Finally, year-over-year sales to organization by R&D. margin higher were across optimize offset operating spending and investments partially initiatives lower

Health two and to in transactions. credit. $XX.X net balance quarter million October, $X.X Science, offering cash. sheet with in strong. separate line and strategic Nestlé balance not We million did of flow, cash the committed new our with remained We our investors raised Moving existing access sheet costs, the investor, In a we ended of

vendors, timing BXB collected of from first offset minimum an our the from purchases of our fourth in from increase to partially in by and from quarter customers and the XXXX. in We XXXX. use this receivable a fourth million purchase was $X.X inventory, timing to accounts upfront XXXX net decrease quarter net the to primarily higher in of a Watsons. of due collections including versus accounts operations million quarter payable cash million loss, $X a the in these lower increase driven used our payments and Nestlé in of of by In The customers, was quarter due cash orders $X.X only cash difference

year with We've provided release full P&L in along metrics our outlook earnings on presentation. key our XXXX for slide press details the

XX% the only a growth environment and a realistic taking revenue year-over-year are steady from of it business year considering least and As approach net E-commerce macroeconomic growth relates XXXX of full uncertain we light at to possibility partnerships. with greater growth. sales, significantly expect our conservative we recurring In established

upside products pipeline. potential see we from new and said, partnerships, channels, Rob As in the

to that We all as stable margin over remain on gross offset pressures. year-over-year inflationary largely anticipate expected savings are will our initiatives cost scale

in the Further, of sales first expense optimization. customer a percentage we focused quarter. further pursue to strategies we one basis by the on a driven marketing full the mentioned like decline targeted as expect quarterly that and Deep Rob net continue year timing will of brand campaigns new as selling acquisition volatility and awareness

patents, NAD we will precursor as R&D to our that other well expect as year-over-year We be as up to development related invest future in innovation granted recently new drive growth.

$X that cost optimize expense, in $X expect by reduction we structure. to Finally, million reduction reported a G&A other will driven be of and restructuring general and our as executive headcount all in lower compensation reduction down million, a expenses we in severance a share-based driven by areas

profitability, We equation recognize is is only disciplined that the half expense sustainable half of achieve to the growth. management other

infrastructure, this but level We in are confident existing business investments to make measured stable growth a based in our we of year. on growth plan

building with brand expense upside this be recognized for next sales this in quarter event over will is one the we month. have the mentioned, quarters. realized few such current Rob investment full that As The

to adjusted EBITDA in XXXX, expect quarter close the with quarter of this the due better or we brand building to Overall, exception be investment. break-even to first each

positioned In made delivered financial summary, XXXX. our six months. and progress we've the success meaningful in and for on company in immediate last business the objectives, We

to pipeline. and on reasons many conservatively, have initiatives planning be are already partnerships in We the but optimistic based

as through focused profitability. proud leaner for forward bring operational growth. of positioned Rob the to continued organization leading the we and to and to transition that a incredibly on by their innovation-driven encouraged I efforts renewed I'm is look for focus I'm and to company more the date, our pursue to growth Niagena market Tru and team ChromaDex efficiency

Operator, are ready now questions. to we take

Operator

Thank Instructions] [Operator you.

Our Please first ahead. from question go Sturdivant. comes Mitch from Pinheiro

Your open. line is

Mitch Pinheiro

Hey afternoon. good

Andrew Shao

Hi, Mitch.

Mitch Pinheiro

of a you e-commerce business in fourth could and what and far in if Hey, about so flat e-commerce the curious into this in it the beginning dive going year? deeper little I just, in and I quarter, just on remarks, you want your looked it’s I to so just talked year-over-year, was how was your was Rob

Rob Fried

overall that least during there and at in that lasted and seems – maybe impact Well, affected website but for cancer we notice in marketing subscribers, to release, and recovered, year, the the year say so it were a six weeks. about it first we been business an rate half, conversions only would an I But inefficiency the in conversion last press in our there’s our did have by spend.

back. pulled we’ve So,

We’re now, yet a seeing in of don’t – it’s already. looks efficiency like see the and not seen ad spend, We an yes, other definitely a it gas of meaningful blocking a and stable It’s the little return but until indication greater we’ve business. And tackling. really on we’re basic much improvement on demand. just we not parts better hitting pedal

Mitch Pinheiro

And so type What weren’t messages of it conversion to for you? the just marketing led on off? were conversions? is just things what it happening Or side, either the inefficient

Rob Fried

I think Nope, about marketing was it messaging. don’t

made in we had some resources I the the functionality have sufficient decision and outsource the enterprise we to didn’t whom outsourced to business do basic to think of that it.

is the this for improvements last, testing, see basic not the been I an efficient that year. and tackling the retention, and good although site see been pages, maybe there’s we improvements basic pretty we’ll there’s There’s have process we’ve made of generally that So say very and there’s e-commerce optimization, dipped. changes blocking I we’ve expectation half, and good year would year, at, dramatic landing there’s there’s but creative, already, at AB running some a my

Mitch Pinheiro

– you bottom the regarding end your hear being sort you I to of able as a can breakeven little And and the of the for sort XX% you EBITDA three just the with bit XX% a the, in from better just adjusted level, of a be follow-up final the guess did comments you help Okay. to get are positive going adjusted EBITDA year? do range, quarters. the full I revenue at need of or the Or – then your upside? growth potential Are revenue

Rob Fried

depends that on it right is answer certain The are to that costs example. unknown for now

to have in rate. prepared and costs the unnecessary, litigation expenditures year that for that XX% us we certain may positive not even are to right. we during EBITDA have you’re we do costs growth the savings event be bit at or royalty then invest a for on yes, little likely would costs, we see XX%. but load litigation probably unnecessary, probably there, this are get If We those that be we than that get potential could patents, There in better a other to fully do all

Mitch Pinheiro

All thanks back right. the for in Well queue. get questions. the I’ll

Andrew Shao

Sure.

Operator

question from Please comes Our Riley. B. Sinderen ahead. next call from Jeff Van

Your open. line is

Jeff Van Sinderen

Hi everyone.

and can the wondering little us give Maybe I’m you been speak Rob, So how IP those, significance incorporated of who’ve be more bit sense products? awarded, a new timeframe. if and your that pipeline into new product the patents a the about can of

Rob Fried

patent. make riboside a We three, new and, are were are XX patents, chloride ago, don’t approximately grace composition of did of patents. without There’s year we on years exciting matter really combination course, it’s job those its actually, of awarded three that years. that us, really extensions of and as a in for patents patent. also only sense in half Dartmouth existing some other have of patent because patents nicotinamide anybody processed us. which That as for they’re left And some patents, The with believe the them well a combination can

strong are we interim full that that anticipated a we suing infringing. go not who necessarily So, riboside the around say to That’s we going very are in up properly very, period. blown moat in people built nicotinamide and to

it But step We’re time very how we take at goes. going a it and to are very, protected. one see

be number Outside working not we analogs very ChromaDex. and also nicotinamide even a of like some at protected indications and riboside patent could superior that those chloride, And but nicotinamide that researching on have that analogs however, of NRH are other to intermediate there chloride. are of just these standpoint there riboside are from a analogs, been analogs, NAR

Jeff Van Sinderen

of sorry, as can at I’m some we productized? point? starting those being new things to perhaps like are NARH, as mode generate And far those in test Kind Okay. Or when this think those revenue? about

Rob Fried

hope generate We another will within revenue year. at a ChromaDex that analog

Jeff Van Sinderen

Okay.

Rob Fried

fairly corners. cut because is though, does not process complicated The Jeff, ChromaDex

we of for company As will applied an to we do that if the the riboside. that NDI the patent version needed, is nicotinamide company frustrating way, the was as or This for FDA may right another by be NDI. rejected it releasing that’s investors, There get an Dartmouth infringed NDI. some on a

regulatory patents. FDA and do. an assuming manufacture very not ChromaDex on product that. the selling are illegal enforce apply would our first market That’s way. We that I we in not To marketplace safe they’re they they We the it. first right So may release knowledge, in What a haven’t proper the safe. get guess it now. the disclosed the very, is quality, approvals. rate, approved We for something

in a know it’s it real time, advertise in it. that’s We that that here. space. it dietary foundation the more expense, done. we way with that’s that’s takes do time takes it more it’s inconsistent There’s more a know research the and way but We consistent the supplement We

commercialize we dietary always develop event the these through proper processes, toxicology the proper the we them or manufacturing food my proper as we that the as going we supplement, or But in it a are will that market hope we we would a it pharmaceutical product. before decide that dietary a as processes, analogs, a is processes that So see within analog in scalable other a a year. regulatory supplement, release of the in to it another a chance the the them in the there as product, but food is event case remember commercialize

Jeff Van Sinderen

Watson I a to turn XX% bit, anticipating growth, catalyst it? and if exceed switch on what greater get is you’re what to I wanted to from can XX% your guidance potentially little just your how sounds into thoughts starting Okay, think put drive baked could substantially or then like good those is Watson, than guess you for we level hear. with around for What’s Nestlé, exceed, that maybe And gears to then revenue revenues Sinopharm, XXXX.

Rob Fried

XX% The from year is into zero revenue zero extremely revenue We Nestlé. Nestlé, this guidance additional its conservative. bake from

conservative XX% on the our Watson’s exceed assumptions projections We XX%. Sino, think existing based contracts around business. conservative based contractual. are have with a are extremely projections partners, on are of That’s very just there’s the chance we we will DTC that realistic and all what’s that we in on Indeed, why the

Jeff Van Sinderen

Okay. And then just how to you anticipate does first Would follow-up on the e-com – to business, positive your turn one? direct this Or at quarter? positive? you that DTC business be business, are that point, you thinking in are about that

Rob Fried

mean you do positive? by What

Jeff Van Sinderen

I mean up year-over-year.

Rob Fried

yes. overall, revenue Oh,

Jeff Van Sinderen

revenue. Yes,

Rob Fried

be Yes, the to of the in first quite bit business we course, positive a quarter. expect DTC

remember website It's is one our but it, quarter-to-quarter, in is Shopify. Amazon, it. is the The what call business coming our There which several one grow opportunity are grow we of domestic other which of international DTC – basically it has components the there’s components to expect may that quarters. another, we a Shopify. Just great not where to

Jeff Van Sinderen

Okay.

not guess So – website, in that anticipated your quarter, clarify I'm business so calling the may, that the right, grow you but business own first just you're website sorry, for I the saying to Shopify you're that... might

Rob Fried

the first grow, not XXX% will will though. its grow might No, it in quarter XXX% grow.

Jeff Van Sinderen

Okay.

right, good. my in questions. taking Okay, fair enough. I'll the Thanks jump All for very queue. back

Andrew Shao

Anytime.

Operator

H.C. ahead. Please from Selvaraju go Wainwright. comes Our next from question Ram

open. Your is line

Ram Selvaraju

hear Can me? you

Andrew Shao

Yes. Hi Ram.

Ram Selvaraju

Hi guys.

the of in a you make most customer on you acquisition if strategy granularity why? looking be to us and changes that could which bit more sort impactful and So the give ones to do you're expect just

then path; and supplement pharmaceutical specifically choosing And food of process around we a to such XXXX. over if is conclude the process path decision with the selection versus a a development up course making follow a I expect respect the or should to have

after product with if these newer go going to with of Rx analogs. you're approach, one you perhaps So indeed development anything an potentially even

of before you're Thanks. that reach in of decision If of end indication the and the XXXX? question to going making target conclusion disclosure process

Rob Fried

going I'm answer asked. that So order in to you

way pharmaceutical I'll First all, answer question based the science. question. acquisition of answer acquisition we I'll customer the and The largely the customer is approach on then

nicotinamide, out, So we impacts understand studies studies. how was all preclinical consumers. come better as and riboside begin Initially better it to

Now that well structure clinical host of whole you're a has understand impact studies very it on of we state and now indications positive and and serious seeing a function. fairly a whole

see you will. they see acquisitions. you those a We cohort brain, cohort that we see you cellular then customer into aging there's quite ladder groups through if energy all few; target to up and You break down groups liver, individual

So optimizing – and that well example, you them then we fairly create and for a then series cohort appeal for platforms and click in you target sale, are path it you and on create to them that several process creative interested do that we used do better. create ads materials that And to you groups attack appeal to a cognition. of that it

less of do to it's optimize get website, ones that in we've basic more fairly it done and of those them late. that but of running again. year minor fundamental so, But weeks that off, process. process, falling so in it Are then we or those our and sense you If paying so, is we an you economics well, we've changes to converting fundamental of over cohort and ones the the any are hard not adopted they? Do converting? the to will is And groups. back consistent that a optimized strategy Once measurement. a coming our spend ad off? make Which we've last On have that done that's a pedal gas e-commerce them? hit on do then And business. well spend you And are the reasonable are just with the return

expectation for maybe So to us in it's quarter, to the not start real thereafter first seeing an growth. but improve shortly is And going we're my opportunity it.

the things. we into to our conservative XXX or Tru however. if months a them is more that One a Niagen who are body a the meaningful other why that subscriber, with rarely realize Because milligrams, that's customer the once least two you for generally on take difference. of amount our find reason sufficient pay that people as is bake It's The cancel. couple have growth performing, projections, retention is did We of a a XXX-plus more than do as than they and not That's they it's take at projections, the communications, way and has strategy. another we the with to regular it strategy, website. attention acquisition

that and time for difference a take stop the people of then period notice notice stop also they We who come customers. once as it and back

strong pieces, for a rate So those that's it. are those And a how take approach retention, of acquisition and very, two months take that the couple very for and and dosage. retention we component Tru has Niagen sufficient it

that a We have as cohort us group. aging for is Cellular works found cohort group cohort group and energy cognition. grow a a growing works as

you if okay, follow questions, have So great. up no

the So let second which pharmaceutical. question, to me jump is

product that in a as strategy So us you part also it's dietary for smart about we helpful Obviously the that that we pharmaceutical at when, questions not it's strategy, because and space. in molecular we think our of lot very good When in think dose, important an, identical you if selling space, just know It's product think and the but the a and in particular be pharmaceutical a have in release not thinking is to that. supplement, it ask the our company. it structure. consistently we been don't composition about you we're

consumer other companies. fairly that analogs this company, are know community has two really investment It is valuable you which not also we a a have yet for and and but it is some others R&D of this the is significant company so why embraced. why So the company is

very it's here and But there's orphan Alzheimer's Cockayne ample Neurological, a disease, preclinical a one these Phase in But done Parkinson's, some on good opportunities represent all studies. which in diseases cases that seen a indications for many many is we quite we've like X syndrome, propose, while and is X studies, us. and pursue. which quite takes also process there work R&D as will now in which for few important the Phase It's not some inflammation and just not mitochondrial, just going you've others. is put there's there

course what will biotech in likelihood do expect a has with be of or with interest in and and not pharmaceutical have to the do with XXXX one a that in this to R&D other is. pharmaceutical company, of us companies the I a something the the many structured space Now lot partner as frequent about pursuing structurally do straight is fully is It likely meetings topic. working analogs. company's we And do strategy. so to of be really biotech we their financed terms

Ram Selvaraju

very you Thank much.

Andrew Shao

you. Thank

Operator

Thalmann. Please comes question next Jeff Our ahead. Ladenburg go from Cohen from

is Your line open.

Destiny Hance

mentioned. know well. you. thank am you that Destiny bit my curious Jeff. on on Most few event to is everyone is hope details Hey, is for of more I branding have which or been I about a us great. more give Could This doing actually you that actually answered, initiative questions this please? a

Rob Fried

Destiny. Hi,

and ago which quite launched spot, we we you television why a of we about we reasons. weeks. reason back from it's campaign well. it a and number is, And tested campaign television did endeavored year created to a a pursue pulled that The recall If actually for six

of was all And not what's but well, cash the what's bottom it the well of year is we happened markets doing know in for in the and the flow focusing the being One top line and on positive capital itself. economy pay to enough and well which importance as as the last in happened line.

is we aggressive to right not a what very to not So it's it's strategy, we television – into we now. from expensive are We pull at it, back retail pursue that will strategy. but that and decided time get plus the going not mass back

at that's growth be pretty that It's on sitting A Niagen annually, is good has people's not XX%, – health. a too a too good, Tru XX%, this growth year It we enough. XX% doing million But XX% what with but good impact company doing a like a understand a with on should product we're $XXX an million quarter. $XX year good product.

take There's pedal take and to conservative, we carefully. potential. We recognize on on take we weeks if We to planning going more yes, hit the right in in that we're need we're carefully opportunity going it shots do not about some shots now. year. the the that the and we again specific coming that that are gas other our later to another we're smartly to tell have but need and that. you shots So to works, upside can shot do want just And we and much we

strategies The a years reason and seen a lot few are like a learned either of in or there, a also whom or research when have few quite for of very lot we there on to there we been out channel message following players or of we it or do last of and people are in that some in very look, a those of There the that us actually we steal have are us that with lot steal other find but we’ve cases aggressively. lot and people’s is, are find whom for imitated different about in science something, thereafter, dietary this research, patents. try business bit a infringe or lot credit platform quickly you out of for that supplement

hopes it’s think be it, the we the we’re campaign that we weeks, have and you’ll mode high it in stealth it. reason. in see and only but counting that’s for So we until the not coming important on But launches

We have projections for the nothing it. in

now. that for conservative you We right reward it projections tell than can’t have but we’ll We good very I think more much a risk see. it, profile. has really

Destiny Hance

strategy questions Watsons great. people’s you, I’ve switch see second. a the over Okay, to I’ll to it just so when no heard in keep couple answers of other launches, mention next of that’ll out for couple for problem. want be an I’m excited weeks. pretty or there Has terms consistent? lifted, XXXX? about commercial be we of there changed like Or been into going more all there efforts? at are anything of questions. staying should marketing have some in is things push? a that that their of thinking restrictions Is the that, – it a it to you it in to the now eye I Like

Rob Fried

are It’s shift is There in do market Tru offering popular. only continues store in out aggressively same. promote brand. and popular marketing be very very, store. it of and the product they Watsons that the to the The only strategic from there it’s expanding very Niagen tactics is The they The is the – in interest a, there. some

than So there Niagen we’ll that in and more Hong is the Tru Kong. just possibility see sold in store

Destiny Hance

it. Got

so Thank my very for Okay, you taking interesting. much question.

Rob Fried

Sure.

Operator

from go McGowan question next comes from Roth MKM. ahead. Our Sean Please

Your line is open.

Sean McGowan

shift to Can referenced? you bit that strength impact in a the about the you talk that due Watsons? what’s Is mix little the that of you. Is that? more Thank causing

Brianna Gerber

gross Gross margin, business Sean, mix? margin and

Sean McGowan

Yes.

Rob Fried

Yes, Brianna. that look Thanks, is reason. the

Sean McGowan

as now when it talking about are about both? Okay. or R&D sales or dollar in talked up, in And being – a you you up percentage spend being

Brianna Gerber

Sean. $XXXX,

Sean McGowan

Okay. is you’ve expense that, wanting brand event and in I not that all appreciate all And to of the to awareness and be you detail, give sales going that this of is shown referenced, the marketing? but

Rob Fried

Yes.

Sean McGowan

have Okay. question wanting lot. awareness other you appreciate Thanks That’s it. I keep I brand And stuff, a that a Appreciate the to about but vest. to close it.

Rob Fried

you, Thank Sean.

Brianna Gerber

you, Thank Sean.

Operator

Please from Bill Tieton Capital. comes question from go Dezellem ahead. next Our

open. is line Your

Bill Dezellem

that more and appreciate I update other Would in strategy at strategy it. detailed have? where us their you. border and to cross Thank the are give please they initiatives they a Sinopharm relative you

Rob Fried

is very Sinopharm methodical.

work. the their with and quality of impressed very work their of the thoroughness We’re

We’re the their launched on impressed not with that platforms. speed work. two They’ve of

partners, more at really, fairly market was There week. in-country but that large quality plan significant it’s very so one estimate we’re can’t very year. last conferences. a as Blue they’ve two partners, partners. say are obtaining cross-border. sales their at Hat been launch But, and they’re think much on Sinopharm in them us also approval, they’re there’s conservative I NMN pursuits. The still in more giving them China is assisting to We like we platforms. there, can They’ve to that two not two do this about methodical sales. now in is trusted really presented conferences, it. They’re I

Bill Dezellem

the for highlight NMN some wondering for had authorities back China? you in the what, if the I opportunity would creating I’m please NMN. window Sino? Rob, impression pushing what’s of of there, And happening is were any practices on that with that marketing

Rob Fried

selling with not Niagen is into already. just H&H into cross-border begun China. cross-border also And of selling, that’s of Sino It’s little actually selling is Watsons is bit Sino better than China. doing well way, made It’s that also quite is the Niagen. China in by we deal Tru actually into a cross-border a H&H China. doing

into The most in general? So, of in there China. we’re Yes. seeing are hundreds of, overall growth NMN cross-border sellers selling literally China

was true. down basically were pulled is that claims claims, He lot government Initially, cracked Tru Tru on advertising taking claims. that were Ka-shing including, have back. not NMN, Niagen Niagen which takes they of companies Li has obviously the a And they making and

to very works. NMN thing However, understand to the just NAD. is inferior a to NMN precursor is Niagen. that It’s

attached In fact, NMN perimeter. is a group the Niagen plus phosphate to

So phosphate blocks literally into NR the some that Niagen, of transport to in the that add with it phosphate order they cell. NMN, with companies, is top it. make and The start problem they or on

doesn’t have once once a blood, So circulating you and in body, NMN its cell. the it through the way it’s consume to enter

what and upregulated pulled Niagen then riboside, elevates and which So is phosphate is NAD. apart, within nicotinamide into gets the is is left the body, cell the

that So it We as does it’s about safe basically if don’t but that, it’s questions we works. that believe some know, there’s NR, do works. believe as it inefficient it but work. NR, We

just doesn’t it as work So well.

are positive have So is never see Niagen, for show out It’s but positive with that you that going Tru reason, passage the has come going to have that benefit will a a to of studies it time, benefit. positive NMN a benefit. as

problem NMN studies don’t claims were that problems there marketing China, yes, but to a long-term we be in as expect So come out. some with in

an but market. issue a so United States, in the China now Now the NMN and big not it’s it market, there for is look here, very banned is already issue is an the us in market that

of Tru Niagen because to on expect not taking your elevating taking the Tru Niagen in when of it healthier. understand market, that by there, NAD you out and research I you you’re there’s kind so even make The this billions hundreds under elevating At don’t NAD now much call overall physiological benefits tens or if body of this dollars not you’re if properly, right your NAD, thinking the any levels stress, be future. of we but understand now not is you’re point,

to does market growing So, of very between of have, partners. but China going around we that I percentage it percentage, three long-term. there the The question now a is be the NMN is right a in the expect market those what percentage for small have

a time, soon and we significant. hopefully is XXXX really it They slowly. in very Sino hoping low planning But your they When I that and We’re market. answers upside are XXXX. the that and growth question. gets big big as hope I one of at works step a in said, take for very, growth the starts potential capturing fairly do Sino chunk aggressive

Bill Dezellem

you does. perspective, the It Thank Rob. for

Rob Fried

Sure.

Operator

questions in queue. I remarks. call would We back the Gerber turn have no for to further over like closing to Brianna

Brianna Gerber

for today. There replay X:XX everyone continued replay be conference a Julianne. time your for is and Pacific and Thank support joining XXXXXXX. of you, you of the call at us X-XXX-XXX-XXXX, today ChromaDex. ID The P.M this number Thank will beginning is

Operator

you participation. Thank call. conference today’s concludes your This for

disconnect. now You may

ChromaDex (CDXC) 8 Mar 232022 Q4 Earnings call transcript