In this photo taken on May 15, 2014, CertiRx president and CEO Tom Mercolino,  one of the co-founders of the company which develops and commercializes technology for authentication and verification of high-value products and important documents, poses for a photo in Durham, N.C. (AP Photo/The Herald-Sun, Christine T. Nguyen)

Christine T. Nguyen

In this photo taken on May 15, 2014, CertiRx president and CEO Tom Mercolino, one of the co-founders of the company which develops and commercializes technology for authentication and verification of high-value products and important documents, poses for a photo in Durham, N.C. (AP Photo/The Herald-Sun, Christine T. Nguyen)

Start-up develops security products

By Laura Oleniacz

The (Durham) Herald-Sun

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DURHAM – By snapping a picture with his mobile phone, Hersh Tapadia demonstrated how an app developed by the Durham-based anti-counterfeiting technology company CertiRx Corp. could find fraudulent changes on a prescription drug label.

Within minutes, Tapadia, a CertiRx’s co-founder and its product development director, had a screen pulled up to show how the app could find and highlight counterfeit areas on a sample drug label.

The start-up is working to build a business around marking drug packages, pills and academic documents for fraud detection and prevention. It also is trying to win grant money to continue work on a technology that it’s developing to mark pills or other products with small particles integrated into the drug’s surface or mixed into its formulation.

“We think, on its face, if law-abiding people know substances are traceable (they’ll) handle them more carefully,” said Thomas J. Mercolino, CertiRx’s president and CEO.

Mercolino is another one of the company’s three co-founders whose background includes work for the medical technology company Becton, Dickinson and Co. and at Johnson & Johnson.

Based out of the First Flight Venture Center, a technology incubator in the Research Triangle’s business park, the company employs six people. The company recently raised $225,000 more in private financing to bring its Series 1 round total to $625,832.

In addition, Mercolino said the N.C. Biotechnology Center, a nonprofit group that uses state funds to boost North Carolina’s biotechnology sector, matched some of that private money with a $170,700 strategic growth loan.

The company got the loan to help with the company’s product development and to boost sales.

CertiRx now is marketing TraxSecur, a tool for detecting fraud on drug packaging or individual pill doses using a mobile phone app, Mercolino said.

It also has licensed its product AuthentiForm, a document-certification technology, to the National Student Clearinghouse.

The nonprofit Clearinghouse is in a test stage with the technology, said Rick Torres, its CEO and president.

The Virginia-based group provides services to higher education institutions, including authentication of education documents.

“The Clearinghouse is involved in both international and domestic electronic exchange of documents, and what we know to be true is that there is, in the world of education which is where we work, there are many varied needs to send authenticated documents,” Torres said.

Part of the reason the nonprofit is interested in the technology is that it could detect fraud in documents regardless of language, he said.

AuthentiForm and TraxSecur use the same basic security marking system, Mercolino said.

They take geometric shapes that are multiplied according to a unique frequency, arranged into a unique pattern, and printed on a drug package or academic document underneath text that they want to keep secure. Then a computer stores the interface between the pattern and the information.

“What we do is more different with the symbols ... from what (everyone) else is doing,” Mercolino said.

CertiRx’s third product only is in the research phase. With it, the company is developing a way of marking pills or other products with tiny particles. The idea is then to use a computer to analyze the ratio of those particles to see if the pills or products are authentic.

Demonstrating the technology, Tapadia held up a small computer chip in one of the company’s offices with the lights turned off. The chip was speckled with tiny, fluorescent particles.

Visible under a blue light, the tiny particles can be sprayed in a unique ratio onto the surface of a drug or mixed into its formulation, Tapadia said.

The work was funded by a Phase 1 Small Business Innovation grant and by the N.C. Biotechnology Center. He said they’re applying for another grant to continue the product’s development.