Applied DNA Sciences, Inc., a biotechnology company, develops and commercializes technologies to produce and detect deoxyribonucleic acid (‘DNA’) and ribonucleic acid (‘RNA’).
Using polymerase chain reaction (‘PCR’) to enable the production and detection of DNA and RNA, the company operates in three primary business markets: the enzymatic manufacture of synthetic DNA for use in the production of nucleic acid-based therapeutics (including biologics and drugs), as well as the development and sale...
Applied DNA Sciences, Inc., a biotechnology company, develops and commercializes technologies to produce and detect deoxyribonucleic acid (‘DNA’) and ribonucleic acid (‘RNA’).
Using polymerase chain reaction (‘PCR’) to enable the production and detection of DNA and RNA, the company operates in three primary business markets: the enzymatic manufacture of synthetic DNA for use in the production of nucleic acid-based therapeutics (including biologics and drugs), as well as the development and sale of a proprietary RNA polymerase (‘RNAP’) for use in the production of messenger RNA (‘mRNA’) therapeutics (‘Therapeutic DNA Production Services’); the detection of DNA and RNA in molecular diagnostics and genetic testing services (‘MDx Testing Services’); and the manufacture and detection of DNA for industrial supply chains and security services (‘DNA Tagging and Security Products and Services’).
The company’s growth strategy is to primarily focus its resources on the further development, commercialization, and customer adoption of its Therapeutic DNA Production Services, including the expansion of its contract development and manufacturing operation (‘CDMO’) for the manufacture of synthetic DNA and associated enzymes for use in the production of nucleic acid-based therapies.
Therapeutic DNA Production Services
Through LineaRx, Inc. (‘LRx’), the company’s 98% owned subsidiary, it is developing and commercializing its LineaDNA and Linea IVT platforms for the manufacture of synthetic DNA and associated enzymes for use in the production of nucleic acid-based therapeutics.
LineaDNA Platform
The company’s LineaDNA platform is its core enabling technology, and enables the rapid, efficient, and large-scale cell-free manufacture of high-fidelity DNA sequences for use in the manufacturing of a broad range of nucleic acid-based therapeutics. The LineaDNA platform enzymatically produces a linear form of DNA it calls ‘LineaDNA’, that is an alternative to plasmid-based DNA manufacturing technologies that have supplied the DNA used in biotherapeutics.
The LineaDNA platform is simple and can rapidly produce very large quantities of DNA utilizing a cell-free process, without the need for complex purification steps.
Preclinical studies conducted by the company have shown that LineaDNA is substitutable for plasmid DNA in numerous nucleic acid-based therapies, including: DNA vaccines; DNA templates to produce various types of RNA, including non-replicating, and self-amplifying mRNA therapeutics; adoptive cell therapy (CAR-T) manufacturing, and homology-directed repair (HDR) mediated gene editing.
Linea IVT Platform
In August 2022, the company launched DNA IVT templates manufactured via its LineaDNA platform, which have resulted in evaluations of the company’s IVT templates by numerous therapeutic developers and CDMOs in the United States, Europe, and the Asia-Pacific. In addition, the company’s IVT templates are currently under late-stage evaluations by two therapeutic developers and one CDMO for use as DNA templates to produce mRNA intended for clinical use in calendar year 2025. In response to this demand, the continued growth of the mRNA therapeutic market, and the unique abilities of the LineaDNA platform, the company acquired Spindle in July 2023 to potentially increase its mRNA-related total addressable market (‘TAM’) to include the manufacture and sale of RNAP for use in conjunction with the company’s LineaDNA IVT templates.
Through the company’s acquisition of Spindle, it launched its Linea IVT platform in July 2023, which combines Spindle’s proprietary high-performance RNAP, now marketed by the company as Linea RNAP, with its enzymatically produced LineaDNA IVT templates.
According to the company’s internal modeling, the ability to sell both LineaDNA IVT templates and Linea RNAP under the Linea IVT platform potentially increases the company’s mRNA-related TAM by approximately 3-5x as compared to selling LineaDNA IVT templates alone, while also providing a more competitive offering to the mRNA manufacturing market. Currently, Linea RNAP is produced for the company under an ISO 13485 quality system by Alphazyme, LLC (‘Alphazyme’), a third-party CDMO located in the United States, which is sufficient for early-stage clinical use of the enzyme. In conjunction with Alphazyme, the company recently completed manufacturing process development work on its Linea RNAP to increase the production scale of the enzyme.
Manufacturing Scale-up
The company plans to offer several quality grades of Linea DNA, each of which will have different permitted uses.
The company is manufacturing LineaDNA pursuant to Good Laboratory Practices (‘GLP’), and is in the final stages of creating a fit-for-purpose manufacturing facility within the company’s current Stony Brook, NY laboratory space, capable of producing LineaDNA IVT templates under Good Manufacturing Practices (‘GMP’) suitable for use as a critical starting material for clinical and commercial mRNA therapeutics, with an anticipated completion date in January 2025 (‘GMP Site 1’). The company also plans to offer additional capacity for LineaDNA IVT templates, as well as capacity for LineaDNA materials manufactured under GMP suitable for use as, or incorporation into, a biologic, drug substance, and/or drug product, with availability expected during the first half of calendar year 2026, dependent upon the availability of future funding and customer demand. GMP is a quality standard used globally and by the FDA to ensure pharmaceutical quality. Drug substances are the pharmaceutically active components of drug products.
Segment Business Strategy
The company’s business strategy for its Therapeutic DNA Production Services is to capitalize upon the rapid growth of mRNA therapies in the near term via its planned near-term future availability of LineaDNA IVT templates manufactured under GMP at its GMP Site 1, while at the same time laying the basis for additional clinical and commercial applications of LineaDNA with its future planned availability of LineaDNA manufactured under GMP suitable for use as, or incorporation into, a biologic, drug substance, and/or drug product at planned GMP Site 2. Planned GMP Site 2 may also be used for additional LineaDNA IVT template manufacturing if customer demand exceeds the capacity of GMP Site 1.
The company’s current plan is: through its Linea IVT platform and planned near-term future GMP manufacturing capabilities for IVT templates at GMP Site 1 to secure commercial-scale supply contracts with clinical and commercial mRNA and/or self-amplifying mRNA (‘sa-RNA’) manufacturers for LineaDNA IVT templates and/or Linea RNAP as critical starting materials; to utilize its current GLP production capacity for non-IVT template applications to secure supply and/or development contracts with pre-clinical therapy developers that use DNA in their therapy manufacturing, and upon the company’s development of its planned future LineaDNA production under GMP suitable for use as, or incorporation into, a biologic, drug substance, and/or drug product at its planned GMP Site 2, and/or its upgrade to GMP Site 1, to convert existing and new LineaDNA customers into large-scale supply contracts to supply LineaDNA for clinical and commercial use as, or incorporation into, a biologic, drug substance, and/or drug product in a wide range of nucleic acid therapies. In addition, the company plans to utilize its planned DNA manufacturing capabilities in GMP Site 1 and/or GMP Site 2 to convert new and existing LineaDNA IVT template customers to LineaIVT platform customers to increase the company’s mRNA-related TAM.
MDx Testing Services
Through Applied DNA Clinical Labs, LLC (‘ADCL’), the company’s clinical laboratory subsidiary, it leverages its expertise in DNA and RNA detection via PCR to provide and develop clinical molecular diagnostics and genetic (collectively ‘MDx’) Testing Services. ADCL is a NYSDOH CLIA-certified laboratory, which is currently permitted for virology and genetics (molecular). In providing MDx Testing Services, ADCL employs its own or third-party molecular diagnostic tests.
The company has successfully internally validated its pharmacogenomics testing services (the ‘PGx Testing Services’). The company’s PGx Testing Services utilize a 120-target PGx panel test to evaluate the unique genotype of a specific patient to help guide the patient’s healthcare provider in making individual drug therapy decisions. The company’s PGx Testing Services are designed to interrogate DNA targets on over 33 genes and provide genotyping information relevant to certain cardiac, mental health, oncology, and pain management drug therapies.
On June 12, 2024, the company received full approval from NYSDOH for its PGx Testing Services. Recently published studies show that population-scale PGx-enabled medication management can significantly reduce overall population healthcare costs, reduce adverse drug events, and increase overall population well-being. These benefits can result in significant cost savings to large entities and self-insured employers, the latter accounting for approximately 65% of all the U.S. employers in 2022. The company plans to leverage its PGx Testing Services to provide PGx testing services to large entities, self-insured employers, and healthcare providers, as well as concierge healthcare providers.
On September 11, 2024, the company announced that ADCL has launched an expansion of its clinical testing services for the detection of Mpox to include testing for both Mpox Clade I and Clade II. The launch of the expanded Mpox testing service comes after ADCL’s interaction with relevant regulatory bodies, including the NYSDOH and the FDA. In August 2024, ADCL conducted additional validation testing showing the Assay can also detect the genetic sequence of Mpox Clade I, which is the subject of the World Health Organization’s (‘WHO’) August 14, 2024, declaration of a public health emergency of international concern.
Historically, the majority of the company’s revenue attributable to its MDx Testing Services has been derived from its safeCircle COVID-19 testing solutions, for which testing demand has significantly declined commencing in its fiscal third quarter of 2023.
DNA Tagging and Security Products and Services
By leveraging the company’s expertise in both the manufacture and detection of DNA via PCR, its DNA Tagging and Security Products and Services allow its customers to use non-biologic DNA tags manufactured on its LineaDNA platform to mark objects in a unique manner and then identify these objects by detecting the absence or presence of the DNA tag. The company’s core DNA Tagging and Security Products and Services, which are marketed collectively as a platform under the trademark CertainT, include:
SigNature Molecular Tags, which are short non-biologic DNA taggants produced by the company’s LineaDNA platform, provide a methodology to authenticate goods within large and complex supply chains, with a focus on cotton and other products.
SigNify portable DNA readers and SigNify consumable reagent test kits provide definitive real-time authentication of the company’s DNA tags in the field.
FiberTyping and other product genotyping services use PCR-based DNA detection to determine a cotton species or cultivar, via a product’s naturally occurring DNA sequence for the purposes of product provenance authentication.
Isotopic analysis testing services, provided in partnership with third-party labs, use cotton’s carbon, hydrogen, and oxygen elements to indicate the origin of its fiber through finished goods.
As of September 30, 2024, the company’s largest commercial application for its DNA Tagging and Security Products and Services was in the tracking and provenance authentication of cotton.
The Uyghur Forced Labor Prevention Act (‘UFLPA’), signed into law on December 23, 2021, establishes that any goods mined, produced, or manufactured wholly or in part in the Xinjiang Uyghur Autonomous Region (‘XUAR’) of the People’s Republic of China are not entitled to entry to the United States. On June 17, 2022, the UFLPA additionally listed DNA tagging and isotopic analysis as evidence that importers may use to potentially prove that a good did not originate in XUAR. Recently, in July of 2024, the company announced a multi-year commercialization agreement for its CertainT platform with Indus Group, a multinational apparel/textile manufacturing and sourcing company.
The company’s business plan is to leverage consumer and governmental awareness for product traceability to expand its existing partnerships and seek new partnerships for its DNA Tagging and Security Products and Services, with a focus on cotton, though this business plan could change based on the outcome of the company’s strategic review of its business segments.
On December 17, 2024, the company announced it is exploring the potential divestiture of its DNA Tagging and Security Products and Services business segment.
Research and Development
The company incurred approximately $3.6 million on research and development activities for the fiscal year ended September 30, 2024.
Distribution of the Company’s Products/Services and Commercial Agreements
The company’s products/services are distributed in the following ways: directly to the customer; through channel partners; and through licensed distributors.
Collaboration and Licensing Agreements
Cornell University College of Veterinary Medicine. During June 2023, the company and Cornell University College of Veterinary Medicine entered into an additional Sponsored Research Agreement (‘SRA’) under which the parties seek to develop and optimize LNP formulations and LineaDNA expression vectors for use in high-value veterinary disease indications, with an initial focus on equine infectious diseases. The period of performance under the SRA is until June 30, 2025, and can be terminated by either party upon at least sixty (60) days written notice.
Customers
The company’s revenues earned from the sale of products and services for the fiscal year ended September 30, 2024, include 26% and 17% from two customers within the company’s MDx Testing Services and Therapeutic DNA Production segments, respectively. As of September 30, 2024, four customers accounted for 59% of its accounts receivable.
Competition
Some of the company’s competitors that operate in the nucleic-acid based therapeutic, biologics, and DNA manufacturing markets include: MilliporeSigma, Precigen, Inc., Aldevron, LLC, Charles River Laboratories, Integrated DNA Technologies, Inc., 4basebio PLC, MaxCyte, Inc., Touchlight Genetics Ltd., Quantoom Bioscience, Syngoi Technologies, S.L.U., Generation Bio, Co., Novartis AG, Kite Pharma, Inc., Juno Therapeutics, Inc., Promega Corporation, OriGene Technologies, Inc., Blue Heron Biotech, LLC, Gene Art, GenScript Biotech Corporation, Elegen, Inc., ANSA Biotechnologies, Merck & Co., Inc., and others.
Some of the company’s competitors that operate in the molecular and genetic diagnostic space include: 23andMe, Inc., Laboratory Corporation of America (LabCorp), Quest Diagnostics Inc., Myriad Genetics, Inc., ARUP Laboratories, MyOme, Inc., Sonic Healthcare USA, Fulgent Genetics, Everly Well, Inc., and Fulgent Genetics, Inc.
Some of the company’s competitors that operate in the supply chain security and product authentication markets include: AlpVision Sa, Authentix, Inc., Brandwatch Technologies, Inc., Chromologic LLC, Collectors Universe, Inc., DataDot Technology Limited, De La Rue Plc, Digimarc Corporation, DNA Technologies, Inc., Haelixa Ltd., ICA Bremen GmbH, IEH Corporation, Informium AG, opSec Security Group plc, MicroTag Temed Ltd., Nanotech Security Corp., Nokomis, Inc., Oritain Global Limited, SafeTraces, Inc., Selectamark Security Systems plc, SmartWater Technology, Inc., Sun Chemical Corporation, TraceTag International Ltd., TruTag Technologies, Inc., Tailorlux gmbH, and YottaMark, Inc.
Intellectual Property
As of December 9, 2024, the company’s patent portfolio included the following issued and pending patent applications applicable to each of its three primary business markets:
Therapeutic DNA Production Services
8 issued patents and 11 pending patent applications in the United States.
11 issued foreign patents and 9 pending foreign patent applications.
MDx Testing Services
5 issued patents and no pending patent applications in the United States.
4 issued foreign patents and no pending foreign patent applications.
DNA Tagging and Security Products and Services
26 issued patents and 2 pending patent applications in the United States.
47 issued foreign patents and 10 pending foreign patent applications.
The company’s trademarks used in the United States include Applied DNA Sciences, SigNature molecular tags, SigNature T molecular tags, fiberTyping, SigNify, Beacon, CertainT, LineaDNA, Linea COVID-19 Diagnostic Assay Kit, safeCircle COVID-19 testing, and TR8 pharmacogenetic testing.
Government Regulations
ADCL is offering its safeCircle surveillance testing in compliance with Centers for Disease Control and Prevention (‘CDC’), U.S. Food and Drug Administration (‘FDA’), Centers for Medicare & Medicaid Services (‘CMS’), and New York State Department of Health recommendations.
In addition, clinical diagnostic testing and the review and approval of LDTs in New York State currently falls under the jurisdiction of NYSDOH and the FDA. ADCL is offering all clinical diagnostic testing and LDTs in compliance with NYSDOH regulations.
The FDA and comparable government authorities having jurisdiction in the countries in which the company’s customers intend to market their products have the authority to withdraw product approval or suspend manufacture if there are significant problems with raw materials or supplies, quality control and assurance, safety, efficacy, or the product is deemed adulterated or misbranded.
History
The company, a Delaware corporation, was founded in 1983. The company was formerly known as Datalink Systems, Inc. and changed its name to Applied DNA Sciences, Inc. in 2002.
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