H.C. Wainwright & Co. analysts Dr. Raghuram Selvaraju and Mitchell S. Kapoor, in a research report published on July 15, 2024, provided an update on ChromaDex Corp. (CDXC:NASDAQ) following the company's announcement of Niagen+, a pharmaceutical-grade injectable formulation of its patented nicotinamide riboside chloride (NRC). The analysts maintained their Buy rating and a 12-month price target of US$6.00 on the stock.
"Last month, ChromaDex unveiled Niagen+, the first-of-its-kind pharmaceutical-grade NIAGEN (patented nicotinamide riboside chloride or NRC). Authorized by the FDA for compounding by 503B outsourcing facilities, pharmaceutical-grade intravenous (IV) and injectable NRC will be available in IV, shot, and push forms exclusively at clinics, with a prescription," the analysts noted.
Selvaraju and Kapoor highlighted the potential market opportunity, stating, "NIAGEN IV could penetrate the global intravenous hydration therapy market, which was valued at 'US$2.32B globally and US$1.15B in North America (2022),' according to Grand View Research. This includes the NAD+ IV market, which ChromaDex estimates may be valued at over US$100 million in North America alone (2023)."
The analysts emphasized the superior tolerability and shorter infusion time of Niagen IV compared to NAD+ IV, based on findings from the first-in-human clinical trial.
"In a head-to-head comparison with the mainstream alternative, NAD+ IV, NIAGEN IV provided superior tolerability and a 75% shorter infusion time, with blood NAD+ levels peaking faster and higher within three hours post-infusion," they reported.
ChromaDex's strategic plans include launching Niagen+ in limited quantities at select clinics starting next month, with aims to expand availability nationwide. The company is also pursuing patent protection for NRC and other NAD+ precursors for intravenous use.
Recent milestones for ChromaDex include the inclusion in the Russell 2000 Index and the upcoming transition of its Chief Financial Officer, Brianna Gerber.
H.C. Wainwright's valuation methodology for ChromaDex is based on a revenue multiple approach. "We apply a 5.3x revenue multiple to our 12-month top-line estimate of US$102.5M (discounted back at a 12% rate, which translates to US$81.7M), which yields a price objective of US$6 per share with roughly 75.6M shares outstanding as of end-1Q25," the analysts explained.
With a Buy rating and a price target of US$6.00, representing a potential return of approximately 130% from the price at the time of the report of US$2.61, H.C. Wainwright sees significant upside potential for ChromaDex.
The analysts conclude, "In our view, therefore, the advent of NIAGEN IV could usher in a powerful new tailwind for revenue growth at ChromaDex—one that may accelerate the company's path to profitability and that could generate positive cash flow from operations to advance [the] development of other pharmaceutical-grade products."
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Disclosures for H.C. Wainwright & Co., ChromaDex Corp., July 15, 2024
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Investment Banking Services include, but are not limited to, acting as a manager/co-manager in the underwriting or placement of securities, acting as financial advisor, and/or providing corporate finance or capital markets-related services to a company or one of its affiliates or subsidiaries within the past 12 months.
H.C. Wainwright & Co, LLC (the “Firm”) is a member of FINRA and SIPC and a registered U.S. Broker-Dealer. I, Raghuram Selvaraju, Ph.D. and Mitchell S. Kapoor , certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies. None of the research analysts or the research analyst’s household has a financial interest in the securities of ChromaDex Corporation (including, without limitation, any option, right, warrant, future, long or short position). As of June 30, 2024 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of ChromaDex Corporation. Neither the research analyst nor the Firm knows or has reason to know of any other material conflict of interest at the time of publication of this research report.
The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services. Mr. Selvaraju, who is [the][an] author of this report, is the Chairman of and receives compensation from Relief Therapeutics Holding SA, a Swiss, commercial-stage biopharmaceutical company identifying, developing and commercializing novel, patent protected products in selected specialty, rare and ultra-rare disease areas on a global basis ("Relief"). You should consider Mr. Selvaraju's position with Relief when reading this research report. The Firm or its affiliates did not receive compensation from ChromaDex Corporation for investment banking services within twelve months before, but will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report. The Firm does not make a market in ChromaDex Corporation as of the date of this research report.
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