Development and Marketing Agreement with TheraCann International Will Create the First Seed-to-Sale Cannabis Tracking System Combining Molecular Tagging and Blockchain Technologies

STONY BROOK N.Y. (January 25, 2018)Applied DNA Sciences, Inc. (NASDAQ: APDN, “Applied DNA,” “the Company”) today announced the signing of an initial two-year, $1 million contract with TheraCann International Benchmark Corporation, (“TheraCann”), a leading full service cannabis consultancy with operations in the US, Canada, Australia, Europe and South America, for the integration of the Company’s SigNature® molecular tagging and testing technology into TheraCann’s blockchain-based, seed-to-sale Enterprise Resource Platform (ERP) for legal cannabis operations. Under the terms of the contract, the companies have entered into a development and marketing agreement whereby Applied DNA will develop the technologies necessary to tag and authenticate legal cannabis throughout the supply chain and seamlessly integrate tagging and authentication data into TheraCann’s ERP and Blockchain platform. Applied DNA will receive an initial payment under its contract with TheraCann in the current quarter.

Cannabis sits in front of laboratory glass.

The rapid global adoption of legal cannabis legislation has accelerated the need to secure and truly validate cannabis supply chains from seed-to-sale. Current systems, many of which rely on RFID or bar code technologies, are capable of accurately tacking cannabis supply chains through the cultivation stage, but cannot forensically track cannabis and/or cannabis derivative products back to a specific source once the physical tags and packaging are removed. This gap allows the opportunity for illegal diversion and the introduction of illegally-sourced cannabis into legal supply chains. Combining molecular tagging with digital tracking enhances existing seed to sale systems to a new level of capability and compliance with state, and international laws and guidelines.

In response to the known limitations of current seed-to-sale systems, the State of Colorado this month introduced a new bill (SB 18-029) that mandates the addition of physical-chemical identifiers (PCIDs), of which Applied DNA’s molecular tags comply, to all legal cannabis plants grown in the state for the purposes of tracking cannabis and cannabis derivative products back to their origin. As the industry matures, next generation platforms, such as the one under development by Applied DNA and TheraCann, will support collaboration between regulators, law enforcement and producers in shaping the future of the cannabis industry.

“Our molecular tag creates an immutable link between the authenticity of goods and the authenticity of digital transactions to serve as a unique and forensic identifier that becomes part of a blockchain transaction throughout the supply chain,” stated Dr. James A. Hayward, president and chief executive officer of Applied DNA. “We believe that all blockchain platforms require forensic origination to ensure the veracity of the subsequent distributed ledger. The legal global cannabis industry is a complex supply chain and, therefore, a natural fit for our proven technologies across all medical and consumer applications. We are excited to work with TheraCann to enhance traceability in the expanding legal cannabis market.”

According to a market report from Arcview Research, the North American legal cannabis market in 2017 was valued at $6.7 billion per year and is expected to grow to $20.1 billion per year by 2021. While cannabis remains illegal under US federal law, eight states plus Washington DC have legalized cannabis for recreational use, while twenty-nine states plus Washington DC have legalized cannabis for medical use. An additional seven states are expected to legalize cannabis in the coming year. 15 countries outside the USA have permitted medical cannabis. Canada has been operating a federal medical cannabis program since 2001 and is expected to federally legalize recreational cannabis by mid-2018.

Chris Bolton, Chief Operating Officer for TheraCann added, “The platform under development by TheraCann and Applied DNA will be uniquely suited to meet the growing demand for true forensic level seed-to-sale tracking and diversion control systems globally. As each new state or country legalizes medicinal or recreational cannabis, it creates an opportunity for the broad-scale adoption of our technologies.”

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. The Company makes 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 uncopyable, security and authentication solutions such as SigNature®T and fiberTyping®, targeted towards 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.

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About TheraCann International Benchmark Corporation
Founded in 2004, TheraCann International Benchmark Corporation offers a one-stop, full-service solution for the International cannabis marketplace including, government applications, planning, facility design, cultivation, marketing and communications. With nearly 5 million square feet of cannabis operations under management and the successful launch of groundbreaking Enterprise Resource Planning (ERP) software, Aeroponic cultivation systems and integrated finCEN compliant blockchain solutions, TheraCann provides cannabis-related businesses with solutions to fit their regulatory requirements.

More information about TheraCann is available at www.theracanncorp.com. Follow TheraCann on Twitter and Linkedin.

Forward-Looking Statements
The statements made by APDN in this press release 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, shifting enforcement priorities of US federal laws relating to cannabis, 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 28, 2017, which is 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.

Contacts
investor contact: Sanjay M. Hurry, 212-838-3777, shurry@lhai.com
media contact: Cheryl Schneider, 212-825-3210, cschneider@dgicomm.com
program contact: Gordon Hope, 631-240-8850, gordon.hope@adnas.com
web: www.adnas.com, twitter: @APDN