Good day, ladies and gentlemen, and welcome to the third quarter 2010 Anika Therapeutics investor conference call. My name is Francis and I will be your coordinator for today. At this time all participants are in listen-only mode. (Operator instructions) I will now turn the call over to Mr. Kevin Quinlan. Anika's Chief Financial Officer, please proceed, Mr. Quinlan.

Thank you, Francis, and good morning everyone. If you have not received a copy of the Anika news release which was issued yesterday after the market closed or would like to be added to our contact list, please contact Sharon Merril Associates at 617-542-5300. The news release is also posted in the investor relations section of Anika therapeutics website at anikatherapeutics.com. Also, I want to mention that we have slides posted on the Anika website that illustrate some of the financial information we will be discussing during today's call. These slides can be found on the investor relations section of the website under the events, webcast and presentation tab. We invite you to take a moment to open the file and follow the presentation along with us. Please turn the slide two. Before we begin, please remember that the statements made in this call which are not statements of historical fact are forward-looking statements as defined in the Securities Exchange Act of 1934. Words such as, will, believe, appear, plan, expect, anticipate, forward, seek, continue, target, goals, objectives, on track, intend, pursue, outlook, as well as other expressions which our predictions or indications of future events or trends and which do not constitute historical matters identify forward-looking statements. These statements are based on the current beliefs and expectations of management and are subject to significant risks and uncertainties. The company's actual results could differ materially from any anticipated future results, performance or achievements described in the forward-looking statements as a result of a number of factors which include those set forth and last evening's press release and the company's SEC filings. Please move to slide three, as I turn the call over to Anika's President and Chief Executive Officer, Dr. Charles Sherwood.

Thank you, Kevin. Good morning, everyone and thanks for joining us today. Anika continued to perform well in the third quarter. It was our thirteenth consecutive quarter of product revenue growth compared with the same quarter of the previous year and we advanced in significant ways on all six of our major goals. All the key indicators for ORTHOVISC are moving in the right direction, including growth and product revenue and market share. With FAB, our pipeline is broader and stronger than ever and we're making good progress on four upcoming product approvals in our Orthobiologics franchise headlined by the U.S. approval and launch of MONOVISC. With the operational integration of FAB going well and the near-term consolidation of our manufacturing in a single facility we're setting the stage for stronger margins and earnings going forward. I’ll have more to say about our progress in each of these areas after Kevin's financial review and then we will be happy to take your questions. Kevin?

Thanks, Chuck. Please turn to slide four in the presentation. Anika preformed well from a financial perspective in Q3. Total revenue in the third quarter of 2010, including FAB, grew 29% from the third quarter last year to $13.9 million. On an organic basis, that is excluding FAB, our product revenue increased 14% from the third quarter last year. Consolidated product revenue grew 31%. This revenue growth was driven primarily by the continued strong performance of our joint health franchise. As you can see on the slide, FAB is also contributing to our total revenue in additional therapeutic areas. As shown on slide five, revenue and our orthobiologics franchise which includes our joint health products increased 25% to $7.7 million from the third quarter of 2009. Primarily reflecting strong domestic sales of ORTHOVISC, as well as an increase in international sales of MONOVISC and the contributions from FAB. Domestic Orthobiologics sales were up 30%. International Orthobiologics sales including FAB were up 13% and down to 6%, excluding FAB, as we saw the continued impact on sales from the economic weakness in Greece, Italy and Turkey. Slide six illustrates the impact of this revenue growth on the other lines in our income statement. Our third quarter consolidated product gross margin was 54% compared with 65% in the third quarter last year. The decline this quarter largely reflected the addition of FAB products into the overall mix. On an organic basis, Anika's gross margin was 59% down from the third quarter, due largely to added inventory reserves and duplicate manufacturing expenditures during our transition from Woburn over into Bedford. I've mentioned this latter point on previous calls, the transition of manufacturing operations to our Bedford facility is causing a decline in margins for 2010 compared with 2009. This is because we are…

Thank you, Kevin. Slide number 10 outlines our six major goals for the next 12 months and I will touch on each one this morning. The first is to continue growing sales of ORTHOVISC, our flagship product in Orthobiologics both domestically and internationally. This was another strong quarter in that respect, as ORTHOVISC U.S. product revenue grew 30% from the third quarter of 2009 reflecting continued domestic market share gains. International sales, on the other hand were down 27% for the quarter and 15% year-to-date compared with the same period in 2009. As I mentioned last quarter, the sluggish economy and competitive market for this class of products are creating a challenging environment for ORTHOVISC in Europe. MONOVISC meanwhile is selling very well in Europe. In (inaudible) both the expansion of our EU distribution channel and growing market awareness. Compared with the third quarter of last year, MONOVISC product revenue in the EU was up significantly, albeit often small based. Through the first nine months of 2010, MONOVISC sales are up 114%. We expect this growth to accelerate as our EU MONOVISC distribution continues to gain traction. At the same time, were continuing to work on additional rest of world distribution opportunities for both MONOVISC and ORTHOVISC with an eye toward driving stronger international sales of these products in the quarters ahead. Let's now turn to our second 12 month goal, which is to receive FDA approval and launch three FAB orthopedic products in the United States. We submitted 510(k) applications for each of these products in the third quarter. There are always uncertainties when it comes to FDA filings and 510(k) applications are no exception. However, all three products come with a clinical data package that should facilitate the approval process. We expect approval for one of these products…

Thank you. (Operator instructions) And our question comes from a line of Jim Lieberman with Wells Fargo Advisors. You may proceed. Jim Lieberman – Wells Fargo Securities: This was a terrific presentation. I was very impressed by, the considerable progress you've been making on all fronts. One question, regarding the longer-term plan, of bringing the manufacturing from Italy, from FAB to the U.S. facility. Do you intend to keep an R&D staff in Italy or do you intend to totally, integrate everything into Bedford?

We do intend to keep an R&D staff in Italy. There's some – this is Chuck. There are some advantages, to doing that. There – it allows them to interact, to – also on the front end with commissions in Europe, more effectively, so the bulk of our staff in R&D will be here in Bedford, but we will have a contingent, there in Italy, as well. Jim Lieberman – Wells Fargo Securities: Thank you, shall I get back in line or can ask another question?

I think, you can ask another question, if you'd like. Jim Lieberman – Wells Fargo Securities: Okay. Considering, all the new products, that are going to be introduced, especially from the FAB Genesis, so to speak, how do you intend to manage, those varied introductions or do you think, they're so complimentary, to what you are doing, that it will be very easily done?

Well, let me try to tackle that. I think from the Orthobiologics Orthopedic Product perspective, in other words, Hyaloglide, Hyalofast, Hyalonect, they will fit well, with the sales efforts that we expect to undertake with MONOVISC. It is essentially the same customer and that's fine. We also talked about wound care products in the United States. And I said, headlined by Hyalomatrix. We're actively seeking, distribution partners in the United States, for that line of products. I should, also point out, that Hyalomatrix, in particular, and some of the other wound care products are already approved in the United States for sale. So, our main activity then, is to find partners to commercialize those products here. We have no intention at this juncture to directly sell those ourselves. Jim Lieberman – Wells Fargo Securities: It's a very exciting time for Anika. I'm excited to hear about this. In terms of Hyaloglide, you are saying, this product is already, being sold in Europe?

All of the products, that I mentioned, are already commercialized, in Europe and some of them are commercialized, in South America and Asia, certain countries in Asia, as well. Jim Lieberman – Wells Fargo Securities: Because, that market has a huge potential, down the road as well, I would think.

It is a function of expanding distribution and the other – on the other side of the equation, being able to manufacture these products, more cost efficiently to increase our profitability. Jim Lieberman – Wells Fargo Securities: Thank you very much, again.

Your next question comes from the line of Larry Anderson from Raymond James. (Operator instructions) Please proceed, Mr. Anderson. Larry Anderson – Raymond James: Great quarter and progress, men.

Thank you, Larry. Larry Anderson – Raymond James: This has been a while since you commented on this. Are you in a position now to comment on, the status of the clinical study, with Johnson & Johnson, to use ORTHOVISC for OA of the shoulder?

It has been, a long while since we've commented on that, Larry. That study is now complete and we are in conjunction with Mitek, actively preparing our regulatory strategies and the next step would be submissions. Larry Anderson – Raymond James: Great.

Your next question comes from the line of Neil Gore. You may proceed, sir. Neil Gore – UBS: Hi, guys. First, some of the things that you commented on, for nine months, you said the loss from FAB was $2.5 million, of which $1.5 million was amortization of acquisition premium. Is there any more amortization, we can look forward to, going forward?

Yes. The amortization will go on for a considerable period of time. It's approximately $0.5 million dollars, a quarter and, that will be going on into the foreseeable future. That's part of the price, if you will, of buying a company and incurring acquisition costs, associated with it. Our amortization, I should I say, of the purchase price, associated with it. Neil Gore – UBS: Okay. Next, you talked about our product, is getting market share, that's ORTHOVISC. and, the multi-injection OA products, am I correct, that's what you're referring to, rather than all the OA products for the knee?

That's correct. Neil Gore – UBS: Okay. What's happening to that overall market, now that a competitor has a single injection product?

Well, what we believe is happening, is that a good portion of – or some reasonable portion of the multi- injection Synvisc product are switching to, the single injection Synvisc product and, probably, there's some shared gain, as result of that. We are also gaining share with our ORTHOVISC product, which means, that the other three products in the arena are contributing to ours and the Genzyme product's share gains. Neil Gore – UBS: I see. And, just if we could, possibly, try and compare, apples to apples, MONOVISC and Synvisc, compete each, some compete with each other, somewhere in Europe. Do we have any idea what the market share, where we are competing head to head might be?

Every – it is very difficult, Neal, to look at Europe, as a whole, because in actuality, each country has different issues as we've talked about sometime in the past, on various calls. In some markets, where the compensation for the Physician Injector is based on each injection, multi-injection products are favored. In other markets, where there is a backlog of treatment, single injection products are favored. So, we don't have a lot of good, head on head, in various countries market data. Really. I think, our impression is that the most attractive, market for Synvisc-One, is, of course, the United States and, I'm not quite sure, how much effort, they're really putting toward that product, in Europe for instance. As I also talked about earlier in the call in a lot of countries in Europe, we're just starting to really get going with MONOVISC. I can, really tell you, that there's great enthusiasm, for MONOVISC. I'm not really sure, that I can, very intelligently, speak about the enthusiasm for Synvisc-One, in a lot of these markets yet. Neil Gore – UBS: And, when you were mentioning, the three FAB Products, that were – you were going to, apply through 510-k, you mentioned Hyalofast and you said that right now, it is looking for what purpose and then you said, somewhere down the line, it could grow cartilage. First, what was the first purpose – the initial filing for?

Essentially, as a temporary matrix, as an adjunct to skeletal tissue repair, resulting in the additional benefit of a hemostasis – or hemostatic tamponade. So, we can get that indication and the product will be used. In order to get the indication for cartilage regeneration, that's really a PMA application. Neil Gore – UBS: Right.

And, it will require, a lot more human clinical data, than we currently possess, at the present time. Neil Gore – UBS: May, I go on? Is there any other questions?

You bet. Neil Gore – UBS: Okay, you we're talking – you also mentioned, in your prepared remarks, something about the future impact, from the MONOVISC sales force. Do we have anything started, as far as, looking to build the MONOVISC sales force or do we just have a lot of resumes, awaiting approval and then we will go after them?

Our approach, Neil, is we've done a lot of groundwork to identify candidates and also to provide the materials and the structure, needed to move forward. But, we are going to wait a bit longer, until we actually pull the trigger and hire people and, try to time that better, with getting closer, to the approval date. Neil Gore – UBS: I see and, my less question, you mentioned, by early 2011, you'll be out of Woburn, am I correct, that you are there in Cummings Industrial Park on a month-to-month basis, as far as your lease goes?

The lease that we have in place actually goes through the end of November. Neil Gore – UBS: November of this year? 2010 or 2011?

2010. Neil Gore – UBS: Okay. And, thereafter, you won't be out until sometime in 2011, they say. So will you be a tenant at will, month-to-month or are you negotiating that, they may want you to sign, a multi-month, a six month or something like that?

It is more likely, the tenant at will scenario. Neil Gore – UBS: Okay. That's terrific. Thank you very much. And, I'm looking forward, to all of the things that can happen in the next three to six months.

We are too. Thank you, Neil.

Neal, let me just make one comment. This is Chuck. I said, it quickly, I'm not sure, it was fully, appreciated. In Bedford, right now, we have approval, from our notified body to manufacture, all the products we make. So, we can do that and we are manufacturing, some in Bedford, right now. Neil Gore – UBS: Right. I understood that.

Okay. We're waiting basically for the FDA to come back in and inspect us, for our ophthalmic and for our ORTHOVISC product. And, at some point, probably fairly soon, they will issue the order, to do a pre-approval inspection for MONOVISC, as well. So, the timing of that, is what we are trying to work on and, that affects when to some degree, when we fully leave Woburn because, we are – while, we are building bridge reserves or inventory reserves, we don't want to build too much inventory, over there in Woburn. Neil Gore – UBS: I understand and, while you were talking, I saw something else, I had written down, it just says, ELEVESS and ELEVESS Light. Can you comment, is anything happening domestically with ELEVESS and you got approval to launch ELEVESS Light in Europe, just about a year ago, how is that going?

In terms of domestically, the product is actually, trademarked as Hydrelle. Neil Gore – UBS: Okay.

What we are doing domestically, our main – right now, is we are servicing directly all of our loyal customers, who are calling in to gain access to the product, now that Coapt is no longer supplying it to the market. We're talking and planning our next steps within the United States but, essentially, given all the other activities, that we have going on now, that's kind of taken a little bit of a back seat. With regard to ELEVESS and ELEVESS light, there is significant interest, in that product, outside the United States. Both, in Asia and in other markets, we have got approval for ELEVESS Light. We're working hard to develop inventories for that. So that we can supply our existing customers, who are very, very – being, very patient to receive that. So, it is an issue, where there's big demands but, we really haven't built up the inventories to be able to supply that demand, at the current time. Neil Gore – UBS: Okay. Thank you very much.

Our next question comes from the line of Gary Siperstein with Elliott Rose Asset Management. You may proceed. Gary Siperstein – Elliot Rose Asset Management: Hello. Good morning, guys.

Good morning, Gary. Gary Siperstein – Elliot Rose Asset Management: Chuck, can you give us some, sort of a pathway, on the FDA's process with MONOVISC? You mentioned, it is been submitted, you answered their questions and now you're waiting to see if an Advisory Panel is needed. So what are the two scenarios? Can you go through what if an Advisory Panel is needed, what does that mean, and how does that affect the timeline versus no Advisory Panel and that timeline?

The timeline is probably – there's a panel in December, I think, it may very well be a bit late, to get onto that schedule. I think the FDA can call a Special Panel essentially whenever they want. We're expecting to hear back in the next few weeks as to whether or not they believe that we need to go to Panel. They're actively, reviewing our submission. We've answered all their questions. We're just going to, have to wait and see. I would expect – I would hope, that they can get back to us, with some meaningful commentary in the next few weeks about Panel and, then complete their review, in the next month, couple months, month or two, because, it is really, just answering questions as opposed to starting fresh. So, we've said that, we anticipate the approval, should come in the first quarter of next year. Gary Siperstein – Elliot Rose Asset Management: Thank you.

I'm not sure, the Panel, really slows things down a lot, it really depends. And, now, I'm not totally sure whether we are going to need to go to Panel or not. Gary Siperstein – Elliot Rose Asset Management: Thank you. You're welcome.

At this time, there are no other questions in the queue; I would like to turn the call over to Dr. Sherwood, for closing remarks.

Thank you, Francis. Thank you, to everyone, for joining us today. We appreciate your support, we appreciate your questions and we look forward, to reporting back to you again on our fourth quarter conference call.

Very good. Thank you.

And, ladies and gentlemen, thank you all, for your participation, in today's conference call. This concludes the presentation and you may now disconnect.