There are times when a company is absolutely gifted a bucket full of money by the government. Applied DNA Sciences (OTC: APDN) can add its name to that list today. In addition to the massive expected increases in the company’s revenue stream, the company’s stock shot up $0.04 to an all-time high of $0.11, closing the day up over 60%.
Unlike in-person voter fraud in the United States with only 11 reported cases in the last 20 years, the Department of Defense’s Defense Logistics Agency (DLA) has enacted regulations to address the growing counterfeiting of microchips in defense technologies. In so doing, it named Applied DNA Sciences as the sole provider of DNA marking techniques, specifically its proprietary SigNature®. This DNA marking will be imposed on hundreds of companies, including some of the world’s largest microchip manufacturers. Applied DNA has stated that a number of these companies have already contacted its offices.
While it is easy to simply say that Applied DNA must have done some serious lobbying in order to be awarded this contract, its botanical-based DNA signature works. Only last week, its SigNature® marking was tremendously helpful, if not responsible, for the conviction of 10 men in the UK. The men were responsible for the forceful robberies of eight Loomis cash boxes in 2011. Unbeknownst to the thieves, Loomis had been working with Applied DNA for some time. When arrested, the thieves were in possession of money marked by Applied DNA and Loomis.
Essentially, in the case of the microchips, Applied DNA provides plant-based DNA that cannot be copied. This DNA can be checked at any stage of the supply chain and easily traced back to the fraudulent party. In what can only be called a self-serving statement, Janice Meraglia, Vice President of Government and Military Programs at Applied DNA, stated, “Finding counterfeits in supply chains is a daunting challenge. DLA is taking a leadership role by mandating a positive way to assure authenticity using SigNature DNA. Warfighter support is DLA’s top priority.”
To the delight of Applied DNA and its investors, Applied DNA will make money on all sides of this contract. On one hand, it will be supplying SigNature® DNA marks to chip manufacturers, while at the same time selling verification equipment to microchip distributors. Additionally, the company will be providing consultation and sales support to larger companies required to participate in the DNA marking. Win, Win, Win.
The prevalence of counterfeiting has become prolific in recent years with over one million counterfeit electronic pieces identified. This number is clearly only the tip of the iceberg, as government has never been known for its efficiency. The sheer volume of counterfeiting can only be guessed, and then multiplied. In a Senate Armed Services Committee hearing last November, co-chaired by Senator Carl Levin (D-MI) and Senator John McCain (R-AZ), 1,800 separate “counterfeit incidents” in the military were identified. These “incidents” do not mean a single piece, but could involve hundreds, or thousands, of components.
It is difficult to walk down a street in a major city without being on camera at some point on your journey. This technology has steadily increased over the last 10 years. It is difficult to see Applied DNA not being contracted by more and more individuals, museums, government agencies, etc., each and every month.