Zhong Yuan Bio-Technology Holdings, a Chinese producer of nervonic acid dietary supplements for cognitive health, filed on Thursday with the SEC to raise up to $15 million in an initial public offering.
The company is currently quoted on the OTC Market under the symbol ZHYBF, and closed Wednesday at $2.37 for a market cap of about $40 million; on Thursday, the stock opened at $0.75 (-68%), but shot up after the SEC filing and finished the day at $4.50 (+90%).
Through sole operating subsidiary Bao Feng, the company engages in nervonic acid research, the development of nervonic acid-based herbal and chemical drugs, and the sale of health supplements containing nervonic acid. Nervonic acid is a long chain unsaturated omega 9 fatty acid that is an important component in myelin biosynthesis in the central and peripheral nervous system. Its nervonic acid is extracted from the seeds of Acer truncatum trees, which the company notes has a key function in traditional Chinese medicine. Zhong Yuan Biotech claims that nervonic acid may enhance brain function, and may be effective in retaining or improving the health of the brain in children with ADHD, patients with Alzheimer's disease, and the elderly.
The Hong Kong, China-based company was founded in 2012 and booked $2 million in revenue for the 12 months ended March 31, 2022. It plans to list on the Nasdaq but has not yet selected a symbol (RC ticker: ZYBT.RC). Revere Securities is the sole bookrunner on the deal. No pricing terms were disclosed.
