Applied DNA Sciences, Inc. (APDN) Signature DNA Helps Convict Criminals - Analyst Blog

Grant Zeng, CFA

In a news release issued on January 4, 2011, Applied DNA Sciences, Inc. (APDN), a provider of plant DNA-based security solutions, announced that the Company's DNA evidence was pivotal in helping West Midlands Police and Metropolitan Police Flying Squad in UK arrest and convict two cash-in-transit criminals.

In the West Midlands, Colin Waddingham was found guilty of cash-in-transit robbery and associated offenses and sentenced to 11 years of imprisonment. He was found guilty by a unanimous jury verdict based, in part, on the SigNature® DNA evidence presented during the trial. SigNature DNA was critical in linking the recovered cash to the defendant.  

According to the police, Waddingham robbed a Loomis driver of a cash box at a Shell Petrol Station in Acocks Green, Birmingham (UK). At the time of his arrest, police found in the car evidence from the robbery including one of the stolen cash bags, stolen dyed cash, the cloned number plates used in the robbery, the crowbar and a 12" machete in the driver's door well. Found in his wallet were further dyed notes from the robbery. The dyed notes were identified and traced back to the specific robbery as a result of the forensic DNA authentication of their taggant by APDN.

In London, the DNA evidence provided by APDN's taggant assisted the Flying Squad in convicting Alpesh Daudia of two separate cash-in-transit crimes. Daudia was stopped on suspicion of a robbery and as the officers searched him, a wad of dye-stained cash fell to the ground from his waist. Forensic tests of the dye-stained cash found on Daudia, revealed that the cash was from an earlier cash-in-transit robbery. Although the police had not previously linked him to it, the APDN taggant provided forensic proof to conclusively connect Daudia to this unsolved cash-in-transit robbery from June 19, 2009.

What Does This Mean to APDN?

APDN is a biotech company engaged in the research, development and commercialization of botanical-DNA based security and authentication solutions that can help protect the products, brands and intellectual property of companies, governments and consumers from theft, counterfeiting, fraud and diversion.

Applied DNA is currently focusing its efforts on the cash-in-transit business and the general anti-counterfeiting industry.

Cash-in-transit businesses transport and store cash and ATM cassettes. This is a multi-billon dollar market. The nature of this business makes cash-in-transit an attractive target for criminals. Currently, a system of cash degradation, using a smoke or liquid dye to permanently mark and essentially destroy stolen cash, is used.  

Applied DNA uses its proprietary SigNature DNA platform to offer a forensic security solution for banks and institutions operating in the cash-in-transit industry, including automated teller machine (ATM) operations and banknote transportation and storage.  The Company can embed SigNature DNA Markers into cash degradation inks that are placed in cash-in-transit boxes.  If a cash box is compromised or illegally accessed, the security device discharges the liquid cash degradation dye into the banknotes, which can be detected after the banknotes are recovered by police. One of the advantages of the SigNature DNA marker is that it's more substantive than dyes and persists even after exhaustive washing with powerful solvents.  
      
APDN has seen growing interest in its cash in transit services protection business. The Company's DNA platforms are gaining new markets in military and police applications in response to its reliable performance in cash in transit services. The Company recently has been fielding inquires for its cash protection platform throughout Europe and Asia.

We are optimistic about the Company's unique technology and prospect. With an ever booming anti-counterfeiting business worldwide, along with its unique technology and broad range of product offering, the Company is well positioned to boost its top line and bottom line in the coming years.

We have an Outperform rating for the Company. Our six to twelve-month price target is $0.20.

For a full copy of the research report, please email SCR@Zacks.com. with the ticker APDN as the title.