05 October 2017

Dear Investor:

As an investor in Applied DNA Sciences you are likely aware of the potential applicability of our DNA molecular taggant platform to counter the growing threat from counterfeits in the global pharmaceutical industry. The World Health Organization estimates that 1% of the drug supply in developed countries is counterfeit — including millions of prescriptions in the U.S. alone — with as much as 40% in developing nations.1  Over the past 18 months we have been making excellent progress in our efforts to enter this market.

Our molecular taggant platform is a novel and comprehensive solution that not only addresses regulations on serialization and traceability of pharmaceutical packaging, but is also, we believe, applicable to the individual tablet. We recently announced a partnership with VideoJet, the world’s largest provider of printed coding systems. VideoJet has a long history of serving the pharmaceutical and medical industry with a strong portfolio of pharmaceutical coding and marking solutions, and we have jointly introduced a DNA-secured ink option that can be utilized by a global healthcare industry that is moving to comply with federally mandated regulations, such as the U.S. Drug Quality and Security Act (DSCSA) requirement for serialized pharmaceutical packaging. VideoJet is a terrific partner in our pursuit of the pharmaceutical opportunity as our goal is the same – to safeguard consumer health.

In our view – and one increasingly shared by the industry – serialization on its own, however, is not enough. It must be combined with other strategies to ensure greater security of the supply chain. Our ambition is as simple as it is revolutionary: mark each tablet or capsule made in the world with our molecular taggant to determine authenticity and origin.

Over the past year we have steadfastly pursued this ambition along multiple regulatory paths to enable us to go to market with our platform and enhance the opportunity for adoption by drug manufacturers. We are approaching two milestones of which you should be aware: 1) the completion of a stability study to demonstrate resiliency of our molecular tag; 2) the filing of our Drug Master File (DMF) with the FDA.

Stability testing is an essential part of pharmaceutical development program, and our testing will enable us to better integrate our molecular tag into pharmaceutical formulations. While completion of this testing does not enable us to go to market today, it does generate the data necessary for the filing of our DMF.  We are moving forward with a great sense of urgency to complete stability testing and file the DMF. Once we have filed the DMF we will then have the regulatory confidence to engage with potential pharmaceutical customers who wish to deploy our molecular tag in their products. We anticipate filing our DMF by the end of calendar 2017.

As pharmaceutical manufacturers become much more sophisticated about managing the security of their products, we believe that our platform’s ability to turn the tablet or capsule into an unbreakable bar code will stand out in the marketplace. Applied DNA, its management team and employees are dedicated to capturing this opportunity, and we look forward to keeping you updated on our progress.

Dr. James A. Hayward

Chairman, President and Chief Executive Officer

References:

  1. World Health Organization, “Medicines: counterfeit medicines,” Fact sheet No 275 (Jan. 2010).

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About Applied DNA Sciences

Applied DNA is a provider of molecular technologies that enable supply chain security, anti-counterfeiting and anti-theft technology, product genotyping and DNA mass production for diagnostics and therapeutics.

We make life real and safe by providing innovative, molecular-based technology solutions and services that can help protect products, brands, entire supply chains, and intellectual property of companies, governments and consumers from theft, counterfeiting, fraud and diversion. The proprietary DNA-based “CertainT™” platform can be used to identify, tag, test, and track products, to help assure authenticity, origin, traceability, sustainability and quality of products.

SigNature® DNA describes the core technology ingredient that is at the heart of a family of uncopiable, security and authentication solutions such as SigNature® T and fiberTyping®, targeted toward textiles and apparel, BackTrac™ and DNAnet®, for anti-theft and loss prevention, and digitalDNA®, providing powerful track-and-trace. All provide a forensic chain of evidence, and can be used to prosecute perpetrators. Applied DNA Sciences is also engaged in the large-scale production of specific DNA sequences using the polymerase chain reaction.

Visit adnas.com for more information. Follow us on Twitter and LinkedIn. Join our mailing list.

The Company’s common stock is listed on NASDAQ under the symbol APDN, and its warrants are listed under the symbol APDNW.

Forward Looking Statements

The statements made by APDN in this letter may be “forward-looking” in nature within the meaning of the Private Securities Litigation Act of 1995. Forward-looking statements describe APDN’s future plans, projections, strategies and expectations, and are based on assumptions and involve a number of risks and uncertainties, many of which are beyond the control of APDN. Actual results could differ materially from those projected due to our short operating history, limited financial resources, limited market acceptance, market competition and various other factors detailed from time to time in APDN’s SEC reports and filings, including our Annual Report on Form 10-K filed on December 6, 2016, and our subsequent quarterly reports on Form 10-Q filed on February 9, 2017, and May 11, 2017 which are available at www.sec.gov. APDN undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date hereof to reflect the occurrence of unanticipated events, unless otherwise required by law.

Investor contact: Sanjay M. Hurry, LHA Investor Relations, 212-838-3777, shurry@lhai.com
Web: www.adnas.com
Twitter: @APDN