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Wilmington firm aims to help solve counterfeit drug trade

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Brendan DeLacy Ballydel Technologies

Brendan DeLacy, founder and president of Ballydel Technologies, said his firm aims to serve major pharmaceutical makers. | DBT PHOTO BY JACOB OWENS

WILMINGTON – The state recently approved a $50,000 grant to startup research-and-development firm Ballydel Technologies to address the world’s counterfeit drug trade.

Led by founder and President Brendan G. DeLacy, a former U.S. Army research scientist, Ballydel develops material and technology solutions for the pharmaceutical, defense/aerospace, and energy industries. Founded in 2018, the small firm is based out of the Delaware Innovation Space at the DuPont Experimental Station.

One of its first projects is developing a unique ID tracking system for the world’s vaccine supply.

According to the National Center for Biotechnology Information, counterfeit pharmaceutical medicine trafficking is one of the world’s fastest-growing criminal enterprises, worth more than an estimated $200 billion annually. That makes pharma tracking the No. 1 illicit activity, ahead of other illegal activities such as prostitution, human trafficking, marijuana tracking, electronics counterfeiting, and arms sales.

“This problem also results in toxicity for the patient, and in some cases, death for the patient. The World Health Organization estimates that there are greater than 1 million deaths annually from counterfeit drugs,” DeLacy told the state’s jobs investment board, the Council on Development Finance, at its Aug. 28 meeting.

Ballydel is working on a state-of-the-art, counterfeit-proof security technology that enables drug, vaccine and biologic manufacturers to tag, track and authenticate products throughout their supply chains. It’s developed a novel tag that when exposed to a particular light produces a holographic image.

“It could be a word, it could be a logo, it can be a QR code, whatever the customer wants,” DeLacy said.

The pharmaceutical industry currently depends on barcodes or QR codes to track its products, but those are easily counterfeited for cheap, especially in overseas production centers like China and India, DeLacy said. Another novel market competitor has a product that relies on wireless RFID technology, but DeLacy opined that was prohibitively expensive compared to Ballydel’s invention.

“We’re talking about 25 to 50 cents per label, and it doesn’t sound like a lot, but that really drives up the cost for the consumer on a per dosage basis. We believe that we can make ours for pennies,” he said.

DeLacy said that they would sell their labels directly to pharmaceutical companies, and particularly those who sell high-margin medicines.

“There are dosage forms that are anywhere from $10,000 to $100,000, or more in some cases, that are highly susceptible to being counterfeited and represent a significant risk to drug manufacturers,” he said.

The Council on Development Finance unanimously approved a $50,000 Delaware Technical Innovation Program (DTIP) grant to support Ballydel’s work on the pharmaceutical tags. It previously granted the firm $50,000 to work on an Air Force materials project.

DTIP grants are available to companies that have completed Phase I and applied for Phase II of the federal Small Business Innovation Research (SBIR) or Small Business Technology Transfer (STTR) programs as they work to bring new products to market. The federal programs work as seed funds for small firms that are working on research and development of technical issues across many different sectors.

The SBIR/STTR programs have three phases, with the first awarding up to $250,000 to establish the technical merit, feasibility, and commercial potential of proposed research and development efforts. If successful, Phase II funding can total as much as $1.7 million. Phase III is unfunded, but companies work toward commercialization and/or signing government contracts.

Ballydel received a two-year $256,000 STTR Phase 1 grant from the National Science Foundation to study the issue in 2021, and it is now awaiting a decision on its Phase II application.

If successful, DeLacy said it would lead Ballydel to add at least two employees to its current count of three full-timers and about five part-timers.

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