Trustees of the College filed patent infringement lawsuit

by Charles Chen | 10/3/18 3:02am

On Sept. 18, Irvine, California based-nutraceutical company ChromaDex and the Trustees of Dartmouth College filed a patent infringement complaint in the United States District Court for the District of Delaware against Elysium Health, another nutraceutical company and former customer of ChromaDex. The plaintiffs claim that Elysium is misrepresenting its products and using Dartmouth-ChromaDex intellectual property without proper compensation to its owners.

The two patents in dispute were invented by Charles Brenner, an internal medicine and biochemistry professor at the University of Iowa. Brenner was a faculty member at the Geisel School of Medicine between 2003 and 2009 and worked in the Norris Cotton Cancer Center in Lebanon as a biochemist. During his tenure at the College, he said he discovered that a form of the B3 vitamin found in milk, called nicotinamide riboside or “NR,” increased levels of an enzyme referred to as NAD+ in humans. Brenner said he believed the vitamin could have nutritional and therapeutic value.

Following his discovery, Brenner said he obtained two use patents in 2004 with the help of the technology office of entrepreneurship and technology transfer at Dartmouth. One patent was for nutritional, over-the-counter uses of the vitamin, and the other was for therapeutic, prescribed uses of the vitamin. Several years later, the College sold the exclusive license to commercialize the vitamin to ChromaDex. The company then began supplying the vitamin, which it branded Niagen, to other nutraceutical companies in 2013 before later also selling its own direct-to-consumer supplement called TruNiagen.

ChromaDex supplied the vitamin to several companies including Elysium Health, which sells its own NR supplement called Basis.

The current lawsuit between Elysium Health and ChromaDex is only the most recent development in several years of disputes between the two companies. The pair’s business relationship first soured in 2016 during a dispute over pricing, according to CEO of ChromaDex Rob Fried.

“Elysium’s sales achieved a high level relative to other companies we were supplying NR to, and there began to be some tension in the terms of the supply agreement.” Fried said.

ChromaDex alleges that Elysium then made an order valued at $3 million but refused to pay for it after delivery, prompting the first suit by ChromaDex for the value of the shipment, according to Fried.

ChromaDex also amended its suit to allege misappropriation of trade secrets. The company claimed that two former employees who now work at Elysium — including former vice president of business development Mark Morris, who is now vice president of research and development at Elysium — transmitted confidential information from their former employer to Elysium before leaving.

“They poached employees from ChromaDex [who] knew how to make [Niagen], and they passed on safety information about preparation of Niagen to Elysium investors,” Brenner said.

In an email statement, Elysium vice president of communications Whitney Crystal wrote, “Elysium Health is confident that it does not infringe any valid claim of the patents described in ChromaDex’s most recent baseless lawsuit and trusts that the court will arrive at the same conclusion.”

According to both Brenner and Fried, after the supply agreement between Elysium and ChromaDex ended, Elysium found another source of the vitamin from another company. In 2017, Elysium countered the suits by challenging both of Dartmouth patents in court. One of the Dartmouth patents still stands, but the review of the second is still ongoing.

Fried said he took issue with Elysium claiming the research and development intended for the Dartmouth-ChromaDex vitamin for their own, different product.

“They had identified a new way of making [NR], and they put it on the market and marketed it as research testing and safety tested when any such work was done on the ChromaDex product,” Fried added.

The current patent suit was, according to Fried, prompted by ChromaDex obtaining evidence that its former customer had long planned to harm ChromaDex.

“We now believe that we have evidence that supports the idea that this was planned by [Elysium] from the beginning,” he said. “So that is why we decided now to finally sue [Elysium] for patent infringement.”

Fried said that the goal of the most recent lawsuit was to protect the interests of its shareholders and prevent further abuse of its assets, as well as to take a stand for the patent system as a whole. Fried also said he was working to protect research institutions and universities, such as Dartmouth, that would not receive royalties from the sale of infringed products like Elysium’s product Basis.