When consumers hear the word “counterfeit,” the first thing that comes to mind might be that knock-off Prada wallet in their bag or pocket that, upon closer inspection, actually says “Prado.” But to understand the impact of counterfeiting, those consumers and intellectual property holders must realize that it affects all markets – from clothing and accessories and food and beverages to pharmaceuticals, software and, of course, packaging.
The global economic impact of counterfeit goods has reached an estimate of $1.7 trillion, according to the International Chamber of Commerce, so if you have a brand or product on the market, you’re going to want to protect it. And brand owners are in luck because the anti-counterfeit packaging market is growing. According to a 2016 report by market research and consulting firm Markets and Markets, the anti-counterfeit packaging market is estimated to grow from $82 billion in 2015 to nearly $154 billion by 2020.
Companies like Avery Dennison are already adopting strict anti-counterfeiting stances by pursuing solutions like security threads, customized UV prints and high-end taggant technology. And at Stony Brook, New York-based Applied DNA Sciences, they’re working to prevent counterfeit packaging with plant-based DNA.
“The problem with counterfeit packaging is it contains counterfeit product, so it steals from the original IP holder and it misleads the consumer,” says Jim Hayward, president and CEO of Applied DNA Sciences. “With it comes the concomitant risks of an unknown manufacturing process and an unknown supply chain, unknown sources of raw materials and ingredients, and whether or not a product lives up to its promises.”
Having counterfeit products on the market, Hayward explains, causes damage to the original brand in terms of loss of reputation and actual monetary costs to the company. After all, the original brand is the one spending money to establish and address the current market.
“The counterfeiter has none of those costs,” Hayward says. “So not only do they use inferior product and save money that way, but they have none of the costs of establishing the market. They ride on the coattails of the IP holder with all of the benefits and none of the costs.”
But that’s where the company’s SigNature DNA technology comes in.
DNA, You Say?
“(SigNature DNA) has been on the market for about seven years. It’s an engineered, but botanically derived DNA tag. … It’s effectively a molecular barcode,” says Hayward. “We can insert SigNature DNA into a wide variety of products. Really, to date, we have never failed. It can be inserted into everything from crude oil to an ink used to print the flexible packaging (label).”
The technology is shielded by 100 patents, patent applications and trademarks, and can be embedded into a wide range of host carriers such as ink, varnish, thread, laminates and metal coatings. For brands, it can be used as a forensic complement to barcodes, watermarks, holograms and RFIDs to confirm authenticity. SigNature DNA is also resistant to UV radiation, heat, cold, vibration, abrasion and other environmental conditions, company officials say.
“For film labels, we have a lot of different technologies. We can apply different varnishes or inks that have our SigNature DNA and different covert and overt optical reporters,” says Bob MacDowell, director of government military programs at Applied DNA Sciences. “And then along the supply chain, the different participants – all the way to the end customer – can potentially authenticate or validate that it’s authentic product.”
This past November, Applied DNA Sciences signed a reselling partnership agreement with Bristol, Pennsylvania-based Action-Pak, a contract packaging services provider for military and commercial supply chains. Through the partnership, Action-Pak is offering DNA-based products, starting with Applied DNA Sciences’ tamper-evident labels that feature SigNature DNA with the Beacon optical technology.
“What’s interesting about Beacon is that it is a covert optical marker that has to be chemically unlocked to be seen and validated, so you have to be a part of our supply chain to be able to do that,” Hayward says.
The lock-and-key Beacon technology assures that only trusted sources and companies have access to the key, which activates the optical reporter, MacDowell adds. Action-Pak is also stocking Beacon kits separately to allow supply-chain participants to perform rapid in-field validation of the DNA labels.
A Perfect Match
“In terms of the flexible packaging industry, I see great opportunities,” says Ira Smith, president and CEO of Action-Pak, who has spent 40 years in the packaging business. “For example, an ink jetter could be mounted to a printing press or something, and we could actually fill and sell unique identifier ink that would have specific DNA in it for a specific product or for a specific brand.”
Action-Pak also participated in a logistics pilot project using SigNature DNA labels as part of a cloud-based, track-and-trace simulation under Applied DNA Sciences’ Rapid Innovation Fund contract. The contract was administered by the United States’ Office of the Secretary of Defense.
“We used DNA labels on a flexible packaged item and through the QR code that had the DNA ink inside of it, we were able to scan the items and have that information sent up to a cloud-based repository,” MacDowell says. “And every participant in the supply chain – from the manufacturer to Action-Pak, then to a Department of Defense customer – was able to see the chain of custody throughout the lifecycle of that item.”
Applied DNA Sciences officials say inclusion of DNA into Action-Pak’s flexible packaging product line is a goal for the near future.
“DNA is very flexible. It’s one of the reasons we sit with our customers and look at their process to see how seamlessly we can integrate it,” MacDowell says. “For different customers, there are different solutions, and our solutions range from military to commercial. It’s limitless.”
Applied DNA Sciences
(631) 240-8800; www.adnas.com
(215) 785-4548; www.actionpakinc.com