Salugen, Inc. was co-founded in April 2005 to pioneer the idea of using genetic information to customize nutritional supplements to improve health. By analyzing genetics and customizing nutritional supplements, the Company's mission was to help better live healthier lives. Salugen developed technologies to tackle weight-loss, joint health, and overall wellness. From 2005 to 2008, the Company published over 15 peer-reviewed publications in medical and scientific journals and received awards for its nutrigenomics research from the Natural Products Association.
In April 2005, the Company was created and began crafting its initial pilots. By the fall of 2005, Salugen launched its first pilot of a DNA-customized nutritional supplement, GenoFlex, for joint health. At the end of December 2005, the Company was surprised that a rogue consultant working with the Company's Chief Scientific Officer, received media attention for an upcoming product called GenoTrim, in the Netherlands. Though the company wasn't yet ready to pilot this technology, the Company decided to meet the demand of customers for its revolutionary weight-loss DNA-customized supplement. Unfortunately, the rogue consultant was working with a discredited distributor who ended up making a series of misrepresentations, as well as stealing tens of thousands of euros from customers and the Company. Salugen management spent 6 weeks in The Netherlands to clean-up the mess created by this rogue consultant, distributor, and the company's Chief Scientific Officer. All consumers ended up receiving their testing and their ordered products, and though this discredited distributor stole money, the Company honored any refund requests - even though Salugen was never paid by the discredited distributor. By doing the right thing, Salugen was rewarded by many consumers who were so pleased with their results, and the moral high road of the company. After adjusting to this unexpected development, Salugen launched other pilots, including SpaGen, which was a program involving DNA-customized supplements based on a health survey and genetic test for overall wellness. SpaGen was available through many leading spas, including the MGM family of resort spas in Las Vegas, including MGM-Grand, Treasure Island, Luxor, and others. The Company also conducted a pilot with DNA Services of America to offer its testing through their franchisees in the forensic testing market. Despite growing the business to over $1M in sales in less than a year, the business was not viable without external financing. There was tremendous market potential, but Salugen was ahead of its time. The Company agreed to be acquired by Sherbrooke Equity A.G., a Swiss private equity firm, which committed to fund its growth. As part of the transaction, the Chief Scientific Officer was removed by Sherbrooke due to his misrepresentations about the rights he had to alleged issued patents that were under lien in a bankruptcy court. The transaction closed in the fall of 2008. Sherbrooke provided Salugen shareholders with a minority share position in a newly-created, publicly-listed company (Salugen A.G.) based in Zurich, Switzerland on the Frankfurt Stock Exchange under the ticker symbol (SQZ.F). Sherbrooke listed the stock and had control of the Company. Despite initial success, Sherbrooke was not able to raise the intended amount of capital due to the stock market downturn globally starting in October 2008 . Thus, Salugen Inc. shareholders, who were minority shareholders in the new Swiss company, did not receive any proceeds from the transaction.