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Ryan Drexler of Consac, LLC: A micro cap activist investor with rich operational experience in the health and wellness industry

by | Jan 17, 2017

Ryan Drexler Musclepharm micro cap activist consac vistacost


Ryan Drexler is the CEO of Consac, LLC, which invests in the securities of publicly traded and venture-stage companies, primarily in the health and wellness space.

His family founded Country Life Vitamins in the 1970s. Mr. Drexler served as President of Life Vitamins. He claims that he helped manage, run and grow the business for approximately fifteen years, negotiating the successful sale of the company to the Japanese conglomerate Kikkoman Corporation in 2005.  He claims that he created new brands that include the BioChem family of sports and fitness nutrition products.

“To say the whole vitamin-related space is in my blood would be an understatement”, he added in his letter to’s CEO in February 2014.

Shareholder activism


Consac filed its first 13D in In February 2014, Mr. Drexler sent a letter to the CEO of the company citing significant disparity that existed between the value of the company and the stock price. He suggested that the CEO sell the company. Within six months, the company was acquired by Kroger for $280 million, delivering more than 50% return from the date of his 13D.

MusclePharm Corp.

In February 2015, Consac disclosed 7.4% “active” stake. On June 24, 2015, the company appointed Ryan Drexler to its Board and elected him as Chairman of the Board.

Series of troubles for MusclePharm at the time of his appointment as interim CEO

In September 2015, the SEC charged the company with committing a series of accounting and disclosure violations, including the failure to properly report perks provided to its executives as compensation. A few months later, the auditor issued a going concern opinion in its report on the financial statements for the fiscal year ended December 31, 2015. In March 2016, Brad Pyatt resigned as CEO and Mr. Drexler was appointed interim CEO of the company.

Proof of confidence & commitment

Unlike a “hit and run” activist, Mr. Drexler has stayed invested in the company from February 2015. Moreover, in addition to owning significant stake, in December 2015 Mr. Drexler loaned the company $6 million to assist the company with working capital needs. Subsequently, in May 2016, Mr. Drexler again loaned the company $11 million to settle a contract dispute with its supplier.

Significant turnaround accomplishments

The company’s restructuring initiatives resulted in the following:

– Sale of its subsidiary, BioZone Laboratories for $8.3 million.

– Termination of sponsorship and endorsement agreements, which resulted in overall reduction of approximately $39.5 million in future contractual commitments.

– Reduction of headcount from 310 employees to fewer than 90 employees.

– An agreement with Prestige Capital Corporation that enables the company to use its receivables to finance up to a total of $10 million.

Praise from veteran activist, Nelson Obus

Nelson Obus, portfolio manager of Wynnefield Capital, which owns 8.6%, applauded Mr. Drexler for his turnaround initiative.

He wrote, “We applaud Ryan Drexler for his success in carrying out a complete overhaul of MusclePharm’s business plan and removing executives who made investment in the company a money-losing proposition for so long a period. By jettisoning a series of absurd licensing agreements that threatened MusclePharm’s survival, and other beneficial changes, the company is now approaching a positive free cash flow position. While this significant turnaround came at the steep cost of share dilution, we believe that the improvement in MusclePharm’s prospects creates a real opportunity for all shareholders to benefit in the future from Mr. Drexler’s value creation skills.”


As of writing this article, MusclePharm has lost more than 70% since Mr. Drexler disclosed his ownership in February 2015. Nevertheless, his significant turnaround accomplishments (rather than mere press releases with strategic plans), significant equity and debt commitment are commendable. In my opinion, Ryan Drexler is someone who is worth tracking.


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