Defense security act could aid Applied DNA

Tiny Applied DNA Sciences Inc. in Stony Brook believes it already has a good reason to celebrate the new year.

Despite an expected overall reduction in U.S. military spending, Applied DNA took heart over an amendment to the fiscal year 2012 National Defense Authorization Act signed by President Barack Obama on New Year's Eve. The amendment requires that the Pentagon, the Department of Homeland Security and government contractors "detect and avoid counterfeit parts in the military supply chain."

Not only does Applied DNA make anti-counterfeiting products, but it has already taken part in a Pentagon-sponsored anti-counterfeiting trial program in which it marked military-grade microchips with unique strands of DNA.

"We've been at this a good, solid 18 months now," James Hayward, Applied DNA's chief executive, said in an interview, referring to the Pentagon trial program. "We're now in a position to supply the markets" with the company's technology.

Counterfeiting and suspect parts have become a huge problem for the U.S. military. At a Senate Armed Services Committee hearing last November, committee investigators said that suspect electronic parts from China have been installed on computers that power missiles, flight-display systems in aircraft and electronic display systems aboard ships. The investigators said that more than 500 display units containing suspect parts were sold to the Air Force, the Navy and to defense contractors intended for installation on cargo planes.

Applied DNA, which has made anti-counterfeiting products for the fashion and other industries, has been beefing up its staff in anticipation of a growing defense and electronics market. The company has 25 employees, having added five in 2011. It expects to add another five this year.

The hurdle will be to get the government and defense contractors to buy Applied DNA's products. The company does have competitors. "It's called business," said John Pike, director of Washington, D.C.-based globalsecurity.org, a defense think tank. "They do seem to have a potentially interesting solution to a serious problem, but there's no guarantee that they will live happily ever after."

One of those competitors is nearby. InkSure Technologies Inc. of Manhattan also makes anti-counterfeiting products. InkSure marketing director Sara Hein said that more than 50 percent of InkSure's sales come from business overseas. The new federal regulation "could give us more business in the U.S.," Hein said.