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Jim Hayward, Ph.D.CEO
NASDAQ: APDN
LD Microcap6 June 2017
The statements made by Applied DNA Sciences, Inc. (the “Company”, or “us”) herein regarding the Company and its business may be forward-looking in nature and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements describe the Company’s future plans, projections, strategies and expectations, including statements regarding future results of operations and financial position, business strategy, prospective products, timing and likelihood of success, and objectives of management for future operations, and are based on certain assumptions and involve a number of risks and uncertainties, many of which are beyond the control of the Company, including, but not limited to, the risks detailed in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2016, and other reports filed by the Company with the Securities and Exchange Commission. Forward-looking statements include all statements which are not historical facts, and can generally be identified by terms such as anticipates, believes, could, estimates, intends, may, plans, projects, should, will, would, or the negative of those terms and similar expressions.
Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and may be beyond the Company’s control, you should not rely on these statements as predictions of future events. Actual results could differ materially from those projected due to our short operating history, history of losses, lack of market acceptance of our products and services, market competition, changes in the local and national economies, and various other factors. All forward-looking statements contained herein speak only as of the date hereof, and the Company undertakes no obligation to update any forward-looking statements, whether to reflect new information, events or circumstances after the date hereof or otherwise.
Forward-Looking Statement
• Emerging growth company utilizing molecular-based technology solutions to mitigate
risk and uncertainty in global supply chains, large commercial ecosystems.
• Core SigNature T DNA technology proven at DoD, with law enforcement and in
commercial settings.
– Adopters have concluded that there is a clear and absolute economic benefit to
deploying our DNA mark.
• Growing market awareness converting to broader adoption in business verticals with
substantial TAMs.
– Expanding footprint in established verticals: U.S. government, textiles,
automotive.
– Initial penetration of adjacent verticals in process: synthetic fiber, fertilizer.
– Longer-term opportunities: pharmaceuticals, food, personal care, licensing.
In Brief…..Synthetic biology/IT platform that mitigates trade risk
and is already tested by execution and enormous scale; now we must clone the experience.
Life has changed. And the global supply chain that feeds life is now filled
with complexity, uncertainty and risk.
And change is opportunity.
Beyond single commercial clients, our DNA/IT platform secures the supply chains of
complex commercial ecosystems.
Evolution of SigNature®DNA to CertainT™Toolbox to Platform Servicing Large Commercial Ecosystems
Plant-derived molecular tags
Massive Variety
Formulation and Stability Under Stress
DNA Recovery Systems
Validation Law Enforcement &
DOD
In-Field & Data Management
Data EncryptionMolecular Certificates
DNA Beacons
DNA Massive ScaleSynthetic Biology
Variety Ensembles
Large Commercial Ecosystems
Toolbox
Platform
Our Value Propositionsfrom Molecular Certificates that can not be falsified
Recover counterfeit
market shareTax savings
Sustainability Organic Fair TradeEthical Sourcing Circular Economy
Claims stay with the goods (not paper-trail or the package)
Origin Provenance PurityAuthenticity
Recover lost / stolen goods
Reduce legal risk
Growth Catalysis. Recurring Revenue .DNA makes it possible.
TEXTILES
• Cotton: 5 mm lbs 2014, Σ 160 mm by
2016, US Market 7.3 B lbs/yr
• 8 gins DNA-tagging and likely to
growing
• >1200 stores, >400 SKUs.
• Synthetics: larger than natural fiber TAM
• Markets rife with counterfeits and false
claims (recycled, sustainable).
• Partnerships in place to mirror cotton.
Monthly orders recurring.
MILITARY/GOVERNMENT
ASSET MARKING (esp. Automobiles)
BULK DNA FOR Dx and VACCINES
And in progress - PHARMA/FOODS
Supply Chain Protection
Three DNA-based Business Models
Bulk DNA for Diagnostics and Therapeutics
Crime Prevention and Security
Cash and valuables
safely transported.
DNA makes it
possible.
The use of DNA-marked
degradation dye in the UK has
resulted in a 75% reduction in
cash transport attacks.
115 Convictions
>500 Sentence Years
Recovered Steering
Wheel from Chop Shop
Sting in Stockholm
Location of DNA
highlighted by fluorophore
Arrests of e commerce gang in Asia
ongoing
Press Conference by Lithuanian Police
after DNA trail broke supply chain
packaging gang
Supply Chain Protection
Three DNA-based Business Models
Bulk DNA for Diagnostics and Therapeutics
Crime Prevention and Security
Focusing on the
mission.
Delivering the best
outcome.
DNA makes it
possible.
Helping the Defense
Logistics Agency secure
its electronic microcircuit
supply chain.
Over 700 thousand
components marked.
Contract renewed.
APDN Awarded $1.5 mm Office of Secretary of Defense
Rapid Innovation Fund (RIF) Contract
• An RIF contract provides DLA with innovative technologies
that can be rapidly inserted into acquisition programs to
meet specific defense needs.
• This contract will extend the company’s authentication
platform to facilitate broader use in protecting high-risk or
mission-critical materiel purchased by DLA.
• Awarded by OSD. Managed by DLA HQ. Firm-Fixed Price
Development Contract.
• June 1, 2017 to May 31 2019, $62.5K/mo
DNA marking at cotton gins
8 gins on line; data transfer each
minute; DNA charge adequate to
tag 50 million lbs
Automated dilution for DNA
concentrate.
DNA added at 1 part per trillion
(ppt) of cotton.
DNA is activated on demand and
applied by aerosol during the
dehydration step.
After SigNature T DNA
Marking Pima
compliance about 100%
The data speak for themselves...
Before SigNature T
DNA Marking Pima
compliance less than
30%
Use of SigNature T DNA eliminates fiber
substitution and yields a 100% compliant cotton
supply chain
The Essence of CertainT™
A CertainT-certified supply chain elevates your brand and products by establishing the transparency and truth that consumers desire. Above all else, CertainT of product source, authenticity, safety and provenance drives the purchase decision-making process.
RawMaterial Supplier
Manufacturer Distributor InspectorRetailer / Consumer
Authentication System of Record:Chain of custody | Geo-location | Authentication records | Documents and images |Reports, queries, alerts
Check the data…Be certified for tag, type and process
Tag and test at source
Authentication Every Step of the Way
Supply Chain CertainT™ Other sources
Design and Produce
Molecular Certificate
CertainT™ for recycled PET
Why protect leather?
Verify claims: Sustainably produced
No deforestation
Controlled effluent discharge
Responsible use of chemicals
Animal welfare
Ethically sourced
No slave labour
Traceability: Protect upstream sustainability
credits beyond the split leather
trading process
Supply Chain Protection
Three DNA-based Business Models
Bulk DNA for Diagnostics and Therapeutics
Crime Prevention and Security
Patented (US, Can, China, Israel, EUR-pending) continuous flow system, scaling PCR from micro-liters to liters
Unique Bulk DNA Production
• Vaccines, diagnostics, reagents, bio-
agriculture, and gene therapies for
existing and emerging markets.
• Clinical trial to commercial supply
Benefits of PCR at the Industrial Scale • Product Flexibility. Short to long amplicons• No cellular contamination• Nucleic Acid Chemical Modification• Scalable Production• Reduced Lead Time• Cost-effective
Enabling PCR-based DNA Chemistry at an Industrial Scale
Comparative Consolidated Statement of Operations
Comparative Consolidated
Balance Sheets
