STONY BROOK, NY - Applied DNA Sciences, Inc. (NASDAQ:APDN), a biotech firm specializing in PCR-based DNA manufacturing, and Alphazyme LLC, a Maravai LifeSciences company (NASDAQ:MRVI), announced a significant reduction in manufacturing costs for a key component in mRNA production.
The successful scale-up of their Linea™ RNAP enzyme has led to a cost reduction exceeding 70%, a development that is expected to materially improve the profitability of Applied DNA's Linea IVT platform.
The collaboration between the two companies was aimed at optimizing the production process for the Linea RNAP enzyme, a critical starting material in the manufacture of mRNA, which is used in various biotherapeutics. The joint effort has produced a sufficient quantity of Linea RNAP to meet Applied DNA's near-term demand.
Dr. James A. Hayward, president and CEO of Applied DNA, expressed optimism about the company's biotherapeutics strategy and anticipated growth through its LineaRx segment. He highlighted third-party evaluations that have praised the Linea IVT platform for its dsRNA mitigation and reduced workflow complexity.
With the enhanced economics from the project, along with the upcoming initiation of GMP manufacturing capabilities and new intellectual property protection, Applied DNA aims to secure GMP-grade supply agreements for mRNA starting materials starting in the last quarter of 2024.
Chad Decker, Vice President and General Manager of Alphazyme, emphasized the alignment of this project with Alphazyme's mission to support partners in bringing innovative technologies to market, particularly in the face of scalability and cost challenges.
The Linea DNA platform, which includes the Linea RNAP, is a cell-free DNA production system that can produce high-fidelity DNA constructs without the contamination found in other DNA sources. The Linea IVT platform is designed to streamline mRNA production, offering advantages over traditional methods.
This announcement comes with the caveat that Applied DNA's forward-looking statements are subject to various risks and uncertainties, including the future demand for its products and the approval of PCR-produced DNA technology for therapeutic use.
The information presented is based on a press release statement from Applied DNA Sciences, Inc. and Alphazyme LLC.
In other recent news, Applied DNA Sciences has received approval from the New York State Department of Health for its pharmacogenomic testing service, TR8™, paving the way for broader healthcare application in New York.
The company also secured a patent for its Linea RNAP enzyme composition, integral to its Linea IVT platform, from the U.S. Patent and Trademark Office, extending the patent's life until 2041.
Additionally, Applied DNA Sciences has disclosed a public offering that is expected to generate approximately $12 million in gross proceeds, to be used for the expansion of its Therapeutic DNA Production Services and MDx Testing Services.
In the realm of strategic collaborations, the company has partnered with HDT Bio to expedite vaccine production and with Alphazyme LLC to scale up the production of the Linea RNA polymerase.
However, H.C. Wainwright has lowered its price target for Applied DNA Sciences shares to $1.50 from the previous $7.00, despite this, the firm continues to endorse the stock with a Buy rating.
The company also confirmed a 1-for-20 reverse stock split of its common stock, aimed at ensuring compliance with the Nasdaq's minimum bid price requirement. These are recent developments that could influence the company's operational trajectory in the future.
InvestingPro Insights
In light of Applied DNA Sciences, Inc.'s (NASDAQ:APDN) recent announcement regarding the cost reduction in mRNA production, InvestingPro data and tips offer valuable insights into the company's financial health and stock performance. The company's market cap stands at a modest $4.65 million, indicating a relatively small player in the biotech industry. Additionally, revenue for the last twelve months as of Q2 2024 has seen a significant decrease of 68.52%, reflecting challenges in the company's operations or market conditions.
On the stock performance side, the price of APDN has experienced a steep decline, with a 1-year price total return of -98.25%, indicating that the stock has been under considerable pressure. This aligns with an InvestingPro Tip that highlights the stock's high price volatility, which may be a concern for potential investors looking for stability.
However, it's not all challenging news. An InvestingPro Tip points out that APDN holds more cash than debt on its balance sheet, which can be a reassuring sign of financial resilience, especially for a company in an industry that requires significant capital for research and development. Moreover, the Relative Strength Index (RSI) suggests the stock is currently in oversold territory, which could indicate a potential opportunity for investors who believe in the company's long-term prospects and are looking for an entry point.
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