Advertisement Advertisement AEMD: DARPA Picks Up Year-3 Option
Last week Aethlon Medical (OTC BB:AEMD) announced that DARPA picked up the year 3 option of the five-year $6.8 million DLT contract which will pay the company up to $1.53 million if all eight milestones are met. Through July 2013 AEMD had billed $3.18 million under the DAPRA awards, which represents $1.97 million under the initial year-1 contract and $1.21 million under the year-2 contract (worth $1.6 million and containing eight milestones), which was awarded to the company in August 2012. We assume that the final two milestones under the year 2 contract (worth ~$388k) is billed and paid in fiscal Q3 (ending 12/31/2013).
AEMD has consistently and timely hit milestones under the DARPA contracts and has been rewarded with the follow-on contracts, which we think provides insight into the R&D capabilities of the company as well as lending a vote of confidence in the technology from DARPA, which has been instrumental in the development of a number of high profile products and services (including the internet, the Stealth Fighter and M16 assault rifle, among others). Many technologies initially funded by DARPA are not only in widespread use by the military but are also being used in commercial products.
Our model had previously assumed that AEMD would be awarded the year 3 option - although the exact amount of the award was not know until now. As such we have only made some small adjustments to our model.