Sigmund Brock, a researcher of the Magical World and the one who taught Rotwood, entered in a deal with a unknown party (presumably the Huntsclan) With this party's resources, Sigmund created this substance but did not have a dragon to test it on. After Jake caused Rotwood to be fired, Sigmund became Milliard Fillmore Middle School's new principal.
He planted magical bugs in the basement, thinking it would draw the dragon to fight against them. His plan worked as Jake, Trixie and Spud went to the basement to fight them. Brock then brought Jake to his office where he revealed his plan to expose magical creatures to the world, asking Jake questions about who the dragon was. Brock even poured a tiny drop on Jake's hand but was distracted by some students. Jake looked at his hand terrified. In an attempt to get Brock fired Jake put together a squad in order to take down Brock but nothing worked. Eventually as a last resort during school Jake and his friends snuck in through the air vents so they could steal the Brockium.
However he trapped them in a cage and wheeled them to the auditorium where he planed to use the Brockium. However Rotwood lied by telling him Spud was the dragon. Sigmund used the vial on Spud who obviously did not shift, making him look like a crazy man and arrested for putting children in a cage.
A drop of the vial, however, remained and Rotwood used it to shape-shift Jake's hand causing his hands to turn red and his nails become claws, Rotwood was proud of himself because this proved his theory about Jake being a dragon.