Dow Jones 12969.54 -88.66 1:18 pm PDT, May 5, 2008 NASDAQ 2464.12 -12.87 For info, visit access.smallcapnetwork.com S & P 500 1407.49 -6.41 Change your subscription status here Russell 2000 724.86 -0.88 VOLUME 08 : ISSUE 43 In This Edition It looks like I could have waited to talk about Bio-Matrix Scientific Group until today. A couple of weeks ago I mentioned they were on my mind, as I knew they were getting ready for a big inspection - the licensing inspection. Today they confirmed it.  Today's press release changes nothing from our perspective, but the announcement tells the rest of the world what we already saw coming.  First up, though, is news from Applied DNA. Just a few moments ago they announced a key deal has been struck with a big-time name in detection technology. I think this could open a lot of doors for this budding company.    The Applied DNA Product Circle is Now Complete Applied DNA (OTCBB: APDN) has completed their anti-counterfeit technology circle. No, that's not code for anything - they really have rounded out their product line to cover all the bases.  To fully explain why today's news is important, I have to take a small step back and explain what they do. I promise to keep it brief for those of you who are already familiar with the company.  In short, Applied DNA's 'product' is anti-counterfeit technology, which is commercialized around what they call SignatureDNA(tm). SignatureDNA is a specific strain of botanical DNA that is practically impossible to reproduce ....though it is possible to test for its presence.  To thwart counterfeiting and knock-offs, manufacturers use a product label with Signature DNA embedded into it. Even if the label is illegally reproduced, the DNA isn't. A simple test of the label (or anywhere else that SignatureDNA is supposed to be) will determine if the product is genuine, or pirated.  Previously there were two tests to establish the presence of SignatureDNA. One was a simple color-reactive marker, which was fast, though not necessarily of 'forensic' caliber. The other was a true forensic test, which holds up in a court of law, but can take some time to complete.  Now the company can enjoy the best of both worlds - forensic quality testing that can be completed 'in the field' in only a few minutes.  The addition stems from today's announcement. Applied DNA has entered a tentative agreement (they're calling it a memorandum of understanding) with Smiths Detection. Under the agreement, Smiths will exclusively provide Applied DNA with Bio-seeq PLUS scanners ...a DNA-verifying platform that you can hold in your hand, and get forensic-quality field tests in as little as twenty minutes.  Just how big of a deal this is could be hard to say, though I suspect it's actually bigger than most people might grasp. Smiths Detection does hundreds of millions in sales each year (not dollars, but pounds ...they're based in London, England). A big chunk of that business is given to them by the United States Department of Defense. Point being, Smiths is no small-time partner.  At the same time, I don't think Smiths Detection would bother getting involved if they didn't think there was something big down the road. Remember, the Bio-seeq PLUS platform is being provided exclusively to Applied DNA. I think Smiths could end up bringing as much business to Applied DNA as well as it could be the other way around.  The analogy we've used several times is now is laying another piece of the puzzle. Another one was laid today, and the complete picture is a little clearer now.  As for the stock, we're back around the 10 cent to 14 cent range. That's not a bad or good thing, as there's been no volume to speak of on either side of the fence. It's a waiting game again, though considering this is a longer-term idea, that's nothing new.  One comment we will make about the chart - we're seeing higher highs and higher lows. In fact, last month's low was the second time a key support level has successfully acted as such. It's around 11 cents now.    Bio-Matrix is One Step Closer Bio-Matrix Scientific Group (OTCBB: BMSN) is one step closer to getting their tissue bank license, and becoming the world's only adult stem cell storage facility. The documentation required by the State of California has been submitted, which should soon prompt the inspection of the Bio-Matrix lab. Just to recap why this company has gotten our attention, the stem cell research industry is growing like crazy. By 2012 it could be worth $8 billion. Yet, there's one aspect of it nobody really seems to capitalizing on (except Bio-Matrix)...storage of adult stem cells. That's the attraction - exclusivity. Why is nobody else getting into this piece of the business? After all, the need is already in place, and the income is consistent.  I can tell you what I think is the biggest reason why... too many hurdles. As lucrative as it's likely to end up being, nobody besides Bio-Matrix is in a position (in terms of time or money) to build a facility and get it properly licensed. So, with no real competition on the horizon and millions of buck up for grabs, BMSN is something of a no-brainer for us. The completion of the 'paperwork' step sets up the next item on the to-do list, which is the inspection. Still no exact word on when it's going to happen, though that doesn't change anything for us - we didn't know exactly 'when' before, and we don't know exactly now. That being said... While many things hinge on getting a tissue bank license after the inspection, it may put you at a serious disadvantage if you're waiting to become a shareholder until after we hear the final decision from California's Health Department. Why? Odds are, there's a small army of investors waiting to do the same. If everybody tries to plow in at the same time, this stock could blow through the roof. Personally, I'd rather be in a position before such an event. If they get licensed, it's literally going to flip a revenue switch to the 'on' position for the company, and I suspect the stock is going to reflect that reality. It's just a matter whether you want to try and chase a rally, or be in a trade while everyone else is chasing a rally. For those of you who are already owners, you're probably pleased with BMSN's resiliency...and the establishment of a base. One of my biggest concerns when we started following Bio-Matrix was just that the big February/March rally could have invited some profit-taking. We really didn't see that though. Instead, we saw the key moving averages catch up with the rally while the stock took a break. The consolidation phase has been pretty ordinary - but still important. The range between 40 cents and 62 cents has been relatively well-defined. So, a break above the ceiling of that range would be a big sign of a breakout effort. The longer BMSN stays in the 40/62 cents zone, the more explosive a breakout could be. Today's volume may be the clincher in the deal - it's the best daily volume we've ever seen from this stock. More than that, BMSN is knocking on the door of that breakout, pressing at its ceiling. Maybe this thing is going to pop sooner than later.  By the way, I think we'll be unveiling the new small cap company on Wednesday or Thursday of this week.   Applied DNA Sciences and Smiths Detection Sign Memorandum of Understanding to Provide Rapid Portable Forensic Testing for SigNature(TM) DNA Monday May 5, 4:05 pm ET  STONY BROOK, N.Y.--(BUSINESS WIRE)--Applied DNA Sciences (OTCBB: APDN) announced today that it has signed a memorandum of understanding (MOU) with Smiths Detection (Smiths), part of the global technology business of Smiths Group. Under the terms of the MOU, Smiths will provide APDN with exclusive use of the Bio-seeq(tm)PLUS platform, centered upon a portable, DNA-verifying device for authentication, anti-counterfeiting and anti-diversion. When used in combination with APDN's SigNature(tm) DNA markers, the Bio-seeq(tm)PLUS will provide rapid forensic authentication in the field.  The BioSeeq(tm) platform was originally developed by Smiths for use by first responders to test for biological agents, where reliability and precision are essential. The Bio-seeq(tm)PLUS is a new version of the system which uses LATE PCR (Linear After The Exponential PCR) a technique for detecting and analyzing small amounts of nucleic acid. Smiths hold an exclusive license to LATE PCR from Brandeis University. Bio-seeq(tm)PLUS uses a system of disposable reagent cartridges, which allow use in the field with little technical training. The device is a handheld, fully field-portable PCR identifier that can provide results in as little as 20 minutes depending on the type of assay developed. It supports up to 6 independent simultaneous assays.  Dr. James Hayward, APDN President & CEO stated: "The Bio-seeq(tm)PLUS rounds out our three-pronged offering for authenticating originality: nearly instantaneous optical screening, backed up by in-field forensic marker verification, and ultimately supported when required for legal reasons, by in-lab DNA sequencing. We are committed 100% to ensuring that products and documents that have our unique SigNature(tm) DNA markers can be quickly and forensically authenticated anywhere in the world. More than a deterrent, our SigNature(tm) marks will catch counterfeiters and enable effective prosecution by manufacturers and Intellectual Property owners."  Stephen Phipson, Group Managing Director of Smiths Detection, said, "Smiths Detection's growth strategy is focused on the provision of sophisticated detection systems in regulated markets and the enhancement of global security is a core element in that growth. Our collaboration with Applied DNA Sciences is an opportunity for us to explore new markets for the Bio-seeq(tm)PLUS by protecting ownership, commerce and governments." Bio-seeq(tm)PLUS has the capability to generate rapid results and provide forensic-level identification of products.  "We are gratified by our partnership with Smiths Detection, who recognize our SigNature(tm) platform as a market leader," commented Dr. Hayward. The marketplace needs a device capable of automated field authentication with minimal training. We anticipate strong interest from governments who want to protect trade interests, from companies who have tired of counterfeiters stealing their sales, and from financial institutions who must verify the veracity of financial instruments. Revenue opportunities will stem from the sale of the device and the supply of consumables that contain reagents developed by APDN's scientific team."  About Smiths Detection  Smiths Detection is part of the global technology business Smiths Group. It offers advanced integrated security solutions for customers in civil and military markets worldwide and is a leading technology developer and manufacturer of sensors that detect and identify explosives, chemical and biological agents, weapons, and contraband. Its advanced technology security solutions also include Smiths Heimann x-ray imaging systems, millimeter-wave technology and a specialist software supply business for the management of large sensor and video surveillance networks. Separate business units focus on related products for the life sciences, and food manufacturing industries. For more information visit www.smithsdetection.com About Smiths Group  Smiths is a global technology company, listed on the London Stock Exchange. Smiths Group is a world leader in the practical application of advanced technologies. Its products and services make the world safer, healthier and more productive. Smiths Group has three divisions focused on the high growth detection, medical devices, energy and communications markets. It employs more than 20,000 people in over 50 countries. For more information visit www.smiths.com About Applied DNA Sciences, Inc.  Applied DNA Sciences markets and sells DNA encrypted and embedded solutions that are forensically authenticated by machine readable devices. These solutions can be easily integrated with a range of inks, threads, varnishes, adhesives as well as thermal ribbon, inkjet and laser ink. Applied DNA Sciences' products can help protect the brands and intellectual property that can easily be eroded by counterfeiting, product diversion and fraud. Our common stock is registered under Section 12(g) of the Securities Exchange Act of 1934 and is listed on the Over-The-Counter Bulletin Board under the symbol "APDN".  The statements made by Applied DNA Sciences, Inc. may be forward-looking in nature and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements describe the Company'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 Applied DNA Sciences, Inc. Actual results could differ materially from those projected due to our short operating history, limited financial resources, limited market acceptance, market competition and various other factors detailed from time to time in Applied DNA Sciences' SEC reports and filings, including our Registration Statement on Form S-1/A as amended, our Annual Report on Form 10-KSB, filed on January 15, 2008 and our subsequent quarterly reports on Form 10-QSB. The Company 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.  Contact:  Applied DNA Sciences, Inc.  Debbie Bailey, 631-444-8090  fax: 631-444-8848  or  FCMN Contact:  info@adnas.com  Web site: http://www.ADNAS.com Source: Applied DNA Sciences, Inc.    We Value Your Feedback   Got comments, questions or suggestions? Send 'em on over: Email the Editor If you wish to send a written request or inquiry, please send it to our physical address: TGR Group, LLC 4653 Carmel Mtn Rd Suite 308 #402 San Diego, CA 92130 Stockgroup Refills the Coffer I don't know if they actually needed it, but it never hurts to have it. At the same time, the fact that they could get it at all right now says quite a bit about long-term third-party opinions of their stock.  What I'm talking about is Stockgroup Information Systems (SWEB) and funding. They just got $3 million worth of funding from PEAK6 Investments LP. You may know them better by the name of their website, optionsnews.com. The terns of the deal are pretty straight forward ...Stockgroup is issuing 3000 convertible preferred shares at $1000 each. The conversion rate is 2200 common shares for each preferred share (meaning a total of 6.6 million shares are on the table as part of the deal). The preferred shares have a six-month hold, but will convert to common within two years no matter what. The conversion price is 45 cents per share - a premium to the current price.  The deal also gives PEAK6 the right to use Stockgroup's content feed - something they create anyway.  I honestly wasn't aware they were seeking funding. They had $2.8 million in cash as of their last filing, and $5.5 million in current assets. And, the expense of new website and re-launch has already been incurred. So, form my point of view, they didn't necessarily need it.  On the other hand, the time to raise money is when you don't need it. How's that for a bitter irony? If they were in a crunch, they may have a hard time getting it.  My bigger picture take - to get anything at all right now speaks well of the company. Though Citigroup has raised several billion this year, it's not like a lot of venture capitalists and institutions are jumping on private placements or IPOs right now.  Stockgroup, on the other hand, just raised a significant amount of money without upsetting current shareholder equity too much. The conversion rate is above the stock's current price, the 7% dividend on the preferred is manageable, and the money is going to get parked on the balance sheet for a while.  Subscribe Information is power and timely information is profitable. Become informed and profit from Small Cap Network Profiles and Trading Alerts by becoming a Preferred Member today. There is no cost associated with your email subscription. Add your email address below and make sure to check your email inbox and confirm your opt-in request to start receiving the Small Cap Network Email Newsletter on a regular basis. 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All companies are chosen on the basis of certain financial analysis and other pertinent criteria with a view toward maximizing the upside potential for investors while minimizing the downside risk, whenever possible. Moreover, as detailed below, TGR accepts compensation from third party consultants and/or companies, which it features in the publication and circulation of SCN. To the degrees enumerated herein, SCN should not be regarded as an independent publication.  Click Here or go to http://access.smallcapnetwork.com/compensation_disclosure/ to view our compensation on every company we have ever covered, or visit the following web address: http://access.smallcapnetwork.com/profile_disclosure/ for our full profiles and http://access.smallcapnetwork.com/alert_disclosure/ for Trading Alerts.  TGR Group, LLC has been paid a fee of $30,000 cash and 250,000 shares of newly issued restricted stock by Bio-Matrix Scientific Group, Inc. for coverage of the Company. 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