By GREGORY ZELLER //
Memorandums of understanding are swell and all, but for a scrappy enterprise forever waging a bottom-line battle, nothing beats getting paid.
So, Stony Brook-based Applied DNA Sciences should be very happy to receive the first of two “milestone payments” accompanying the March 31 signing of a new licensing deal with Pennsylvania manufacturer Colorcon Inc.
Announced Thursday, the license and cooperation agreement grants Colorcon the exclusive worldwide right to add Applied DNA’s SigNature DNA molecular tags to film coatings used in the manufacturer’s pills, capsules and other pharmaceutical-industry offerings.
Colorcon, the largest global third-party supplier of “hard dose” pharma products, also enjoys the non-exclusive right to apply its partner’s DNA-based molecular tags to inks and other proprietary applications.
Terms were not disclosed, but the agreement – which follows a technology-licensing memorandum of understanding the fast friends announced in December – includes two “milestone payments” for Applied DNA, including the first “payable with the signing of the agreements,” according to the Stony Brook biotech.
The second milestone payment will be made “upon initial approval by a regulatory authority for application in a [solid oral-dose] pharmaceutical or nutraceutical product application,” Applied DNA said Thursday.
Colorcon will further pay Applied DNA “long-term royalties on the sale of Colorcon products incorporating [Applied DNA’s] molecular tags and on the sale of authentication services related thereto,” the biotech added.
The payday “demonstrates our continuing ability to monetize our DNA molecular taggant platform and associated services to drive revenue growth,” noted Applied DNA President and CEO James Hayward.
And it does so while exposing SigNature DNA to a global pharmaceutical market with a virtually unlimited ceiling, Hayward added.
“The seamless solution integrating our molecular tag with Colorcon’s film coatings puts us on a path to adoption by Colorcon’s current and prospective pharmaceutical customers,” Hayward said Thursday, trumpeting new opportunities to provide “traceability” for law enforcement agents, auditing authorities, retailers, pharmacists, patients and others around the globe.
“We are gratified to be working with a world leader whose sales channel greatly amplifies our combined access to the market,” Hayward said.
The license and cooperation agreement – which will expire on Oct. 1, 2032, or with the expiration of any patent related to Applied DNA’s tech, whichever comes first – burnishes Colorcon’s “established reputation for innovation and service,” according to Kelly Boyer, general manager of the Pennsylvania manufacturer’s Film Coatings Business Unit.
“Applied DNA’s technologies provide value addition at a time when regulators are demanding that the industry implement serialization in order to track packaging,” Boyer said in a statement. “The collaboration goes a significant step further by enabling traceability at the level of single-unit, solid-oral doses.”
And if Applied DNA is hoping that its exposure to new international markets will happen quickly … well, the biotech is going to get that wish, Boyer added.
“Our teams are already actively engaged in discussions with potential customers,” the GM said.