According to this whitepaper, the DNA sequencing is "unequivocally uncopyable".
A bit further on, they only say 'resistant to reverse engineering or replication', which is probably closer to the truth. Here's a patent filed by the company, which looks like it might be referring to the same technology:
http://www.google.com/patents/US20100285985 [google.com]
My reading of the simplest version of this is that they take some target DNA (e.g. derived from a plant genome, and possibly cut up and re-ligated to swap things around), and design a single 'forward' PCR primer and multiple 'reverse' primers that bind the target sequence at various positions. They retain the forward primer and template DNA , and paint the object to be protected with a pooled selection of the reverse primers (different objects or companies could use different selections of reverse primers).
To authenticate an object, they extract DNA from the object (i.e., the pool of reverse primers) and mix it together with their single forward primer, template, and standard PCR reagents. Running the PCR gives them a series of amplification products of defined sizes (determined by the selection of reverse primers), which effectively 'fingerprint' the object. To make things difficult for a forger, the pool of primers painted on the object will probably contain a complex mixture of confounding sequences that don't bind the target sequence, and there may also be multiple genuine primer sets designed to different target sequences. Since the forger won't have access to the target sequence(s), they'll have no way of knowing which primers are important, and will therefore have to determine the sequence of all of them and then have them re-synthesised.
tl;dr - Replicating the label is not trivial.
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