Greetings ladies and gentlemen, and welcome to the CryoLife Fourth Quarter and Year-End 2007 Financial Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host Mr. Steve Anderson, President and Chief Executive Officer of CryoLife. Thank you. Mr. Anderson you may now begin. Steven Anderson – Chairman, President and Chief Executive Officer: Good morning everyone. Welcome to CryoLife’s 2007 year-end conference call. This is Steve Anderson, the company CEO, and with me today is Ashley Lee, the company’s Executive VP, COO, and CFO. This morning we announced record revenues for 2007 of 94.8 million, a 17% increase from the 81.3 million we announced for fiscal year ’06. Net income for fiscal year ’07 was 7.2 million and $0.26 per diluted share compared to net income of 365,000 and a loss of $0.02 per diluted share for fiscal year 2006. Revenues for Q4 ’07 were 25.1 million, a 19% increase over Q4 ’06 when the company posted fourth quarter revenues of 21.1 million. Net income for Q4 ’07 was 2.6 million and $0.10 per diluted share compared to a net loss of $50,000 and $0.01 per diluted share in Q4 ’06. The fourth quarter was the fourth consecutive profitable quarter for CryoLife. It is apparent from these results that the strategic plan that management put into place during the last quarter of 2006 has resulted in a significant turnaround of the company’s operating results. Ashley will get into the details of the financial results for fiscal year ’07 and Q4 ’07 in a few minutes as well as discussing other financial matters. But before he does that, I would like to…

Thanks, Steve. To comply with the Safe Harbor requirements of the Private Securities Litigation Reform Act of 1995, I would like to make the following statements. Comments made in this call which look forward in time involve risk and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements made as to the Company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future. Additional information concerning risk and uncertainties is contained from time to time in the Company’s SEC filings including the “Risk Factors” section of our Form 10-K for the year ended December 31, 2006 and our Form 10-K for the year ended December 31, 2007, which we expect to file by the end of this week and in the press release that we released this morning. During this call, I will refer to certain non-GAAP financial measures. For a mathematical reconciliation of these measures to the most comfortable GAAP numbers, please see the schedules in our press release that was released this morning. A copy of this can be found on the Investor Relations page of our website at www.cryolife.com. This morning, we reported our results for the fourth quarter and the full year of 2007. Revenues for the fourth quarter of 2007 increased 19% to 25.1 million compared to 21.1 million in the fourth quarter of 2006. Excluding orthopaedic revenues of 522,000 and 1.9 million in the fourth quarter of 2007 and 2006 respectively, total revenues increased 28%. Net income in the fourth quarter of 2007 was 2.6 million and $0.10 per basic and fully diluted common share compared to a net loss of $50,000 and $0.01 for basic and fully diluted common share loss in the fourth quarter of 2006. Non-GAAP EPS…

Thanks Steve. The company’s GAAP revenues are composed of product and tissue processing revenues plus other revenues. With the recent clearance of our SynerGraft Processed Heart Valve, we now expect product and tissue processing revenues for the full year of 2008 to be between $101 million and $106 million. Other revenues for 2008 are estimated to be up to 1.8 million, primarily related to funding received from the Department of Defense in connection with the development of BioFoam. Tissue processing revenues are expected to be between 53 million and 56 million and BioGlue revenues are expected to be between 47 million and 49 million for the full year of 2008. Other implantable medical device revenues are expected to be approximately $1 million in 2008. We expect general, administrative and marketing expenses of between 48 million and 51 million and research and development expenses of between 6.5 million and 8.5 million for the full year of 2008. The research and development expectations include an estimate of up to 1.7 million to be funded by the US Department of Defense in connection with the development of BioFoam. Over the last couple of years, we have been releasing revenues a couple of weeks after the end of each quarter. Beginning with the first quarter results of 2008, we will no longer be releasing quarterly revenues prior to our quarterly earnings release. That concludes my comments, and I will turn it back over to Steve. Steven Anderson – Chairman, President and Chief Executive Officer: At this time, I will open up the conference call for questions.

Thank you. (Operator Instructions). Our first question is from Mark Mullikin – Piper Jaffray. Please proceed with your question.

Yes. Good Morning. Can you hear me. Okay.

Yes. We can.

A couple of questions. First Steve, can you just give us an update on BioGlue in Japan. I am sorry, if I missed that in your prepared comment.

No. I didn’t make a comment on that. We still are expecting that the BioGlue application in Japan will be approved towards the end of the first quarter. I am basing those comments on a meeting I had at the Society of Thoracic Surgeons in early January with our distributor from Japan and they still remain very positive that that product will be approved.

And what's the market potential there?

We believe it’s the second largest surgical adhesive market in the world behind the United States which would place it in the $300, $400 million area.

And, will the pricing be similar to what it is in the US?

Can you restate that? I didn’t…

Do you expect the pricing to be similar to the US market then for BioGlue?

We haven’t established the price yet. So, I couldn’t respond to that.

Okay. And, then, just -- for Ashley, should we expect gross margins on processing and on BioGlue to move up from here or maybe to settle down a bit, they jumped pretty nicely sequentially in year-over-year and I’m just wondering if they are going to stay at that level?

I think our BioGlue gross margins we expect to remain relatively constant. We certainly expect some upside from our tissue processing gross margins with the recent clearance of the SynerGraft(R) Processed Heart Valve and we would expect to see more of an impact in the latter half of this year as we’ve got all of our processing as opposed to the first quarter of this year.

And just to clarify actually, the 35% price premium, there is really no significant difference in the costs to process SynerGraft, is there?

There is additional cost associated with it, but it’s not completely substantial. But there is additional cost associated with it.

Okay, very good. Thank you and nice quarter.

(Operator Instruction). Our next question is from Raymond Myers of Emerging Growth Equities. Please proceed with your question.

Thank you and congratulations to the whole team for seeing SynerGraft through approval.

Thank you very much.

Still a long road. We’ve been following it for a long time and you deserve a lot of credit foreseeing it through.

That was a long ride.

Yeah, probably about the longest I think anyone that we’ve seen anyway. But you made it.

Yeah.

What is driving the strong growth in the second half year of the vascular and cardiovascular business? We know that a lot of it comes from the regeneration technologies, business exchange and can you give us a little more clarity as to how much of that growth is organic, how much is it from RTI? And then probably most important, what should we look for in terms of further sequential improvements say from fourth quarter to first quarter and then going into 2008?

Ray, this is Ashley. It’s somewhat difficult for us to exactly determine how much of our growth in the latter half of the year was due to RTI as opposed to our own organic growth and the reason is because we shared a lot of the comment on sources of tissue as well as customers hospitals. And so, it’s very difficult for us segregate out exactly the effect of RTI versus our own organic growth. Our business was growing nicely prior to the RTI transaction, but the RTI transaction certainly had a positive effect to the second half of the year as it relates to sequential growth for these tissues going forward and then into the first quarter of this year. We don’t give quarterly guidance. We give annual guidance on you know the top line, we’ve given that and we don’t give quarterly guidance.

Okay. Let me shift over back to SynerGraft. Steve, you mentioned in your remarks you already have in process 90 valves. How soon can those valves be implanted into people?

We think that the earliest implant is going to occur some time towards the end of March.

Okay. That’s really soon. And how much do these valves retail for?

We think that the pricing on that will be $14,500.

And how soon you think it would take – how fast can you get 90 implants implanted?

I think that’s really based upon the release dates when they come out of quarantine and when they are finished with the quality assurance process. We are expecting to be perfectly straightforward about it. I am expecting the product to be back-ordered almost immediately. I think there is going to be that kind of demand for it.

And can you – from judging from the demand that you see now, can you sell essentially all the valves that you’ve been getting, all the pulmonary valves as SynerGraft right away? Or do you think there will be a transition period?

There is going to be a transition period. But we do know that physicians have been holding some operations on patients in anticipation of the valve being approved, and so I think initially that there will be a real uptick in pulmonary valve replacement using the SynerGraft valve.

That’s great.

I am aware of one physician who has been in contact with me personally that has three or four patients that he has been watching very closely and holding back because he felt that they definitely needed to have our SynerGraft processed valve implanted in them.

And so as I understand correctly, is it $14,000 price was the old price and now it’s 14 to 35…?

Old price was $11,000 in round numbers and the new price will be 14,500.

Okay. That’s great. And with the data that you submitted to the FDA on these 342 patients, this 99% three have endocarditis, 95% from explant, 98% explant with the Ross procedure. How does that compare with – there was no placebo control but what does that compare to – what did you compare it to?

Well, you can go into the literature and compare it to what the explant rates would be for the standard pig valves and it’s considerably better product. You also have to keep in mind that if someone has an active case of endocarditis, the product of choice for implants is a human heart valve because they can be cleaned up easily with antibiotics – with systemic antibiotics whereas if you put a prosthetic valves and that has a synthetic sewing ring. It's a very hard to get a synthetic sewing ring to be cleaned up if it becomes contaminated with bacteria. So, most of the physicians know that and one of the big advantages of a human valve is that you can put it into an infected area and expect it to do very well.

You mentioned that the majority of the valves you have in process are for adults. Does this – were you (inaudible) that you may be expanding your business into more adult patients from the pediatric?

Well it just happens to be the size of the heart that has come in since February 8, but of course you can use it in both adult and pediatric reconstruction. It just happens to be the distribution of the heart valve size that we've received.

But in the past, your business, if I remember correctly was primarily pediatrics correct?

Yes, we focused on that.

So, now that you have a product that has a distinct advantage in infected hearts, does that open a new avenue to the larger adult market?

It will do that, yes.

And that sounds intriguing. Thanks. Just a point for Ashley? The share count actually decline from third quarter to fourth quarter by my estimates, is that right?

I don't have that data available in front of me right now Ray, but I can address that with you off line.

Okay. And, how about the tax rate going into 2008 and 2009? What do we expect that to be?

We're going to have to pay nominal amount of taxes during 2008, primarily related to some international taxes and an alternative minimum tax.

Similar to '07?

Similar to '07. We expect our tax rate during 2008 to be in the mid single digit range.

And, when would you anticipate converting to a regular tax rate?

Ray, we're still in the process of discussing those issues with our tax advisors. You know, we got some significant NOLs that are available to us and it’s really very complex issue that we are discussing with them. Our best guess right now is that it will be probably some time in 2009 before we get back to a more normalized tax rate, but we will probably have a little bit more guidance on that as we move throughout the year.

And in the past your normalized tax rate was close to 30%. Is that because you had a lot of international sales?

I think our taxes were probably a little bit higher than that, but then if you wanted to look at potentially effective rate moving forward, I think you should probably use something between like 35% and 40% under normal rate going forward.

Okay. Great. And can we discuss the planned R&D – the increase in R&D including a clinical studies? I think Ashley has – no; Steve, you had mentioned you can’t talk about BioDisc guidance but we had planned possibly to do some clinical studies there. What clinical study expense do we expect in 2008?

We are setting up – we’ve set up a pilot study of about a 150 additional patients for the BioDisc when that’s gets approved. All those clinics are in place, they have been in place for some time and we definitely will do that as soon as it gets approved. We also have an approval – the Trophic technology had an approval for pilot study prior to our acquiring the technology and so as soon as the pig trial is finished that I discussed then we’ll move into a small pilot study that we are estimating to be in the neighborhood of 150 patients for testing the Trophic organ transport solution. So that is in our budget also for this year.

To start the 150 human patients?

Yes.

That will be good. How long will that study take?

We think that the – getting a 150 kidneys transplanted will take four to six months. So, I think you should expect that we might begin that pilot study towards the end of calendar ’08 and it would run into the – probably run into the second quarter of ’09.

And then you would be able to file in the second half of ’09? Is that the…?

No, we also know from discussions we have had with the – the follow-up period for a kidney transport solution is one month. So, you don’t have a long follow-up period. In other words, the patients are either going to be putting out year end or they are not going to be putting out year end and that evaluation can be made quickly after the transplant.

Right. And when would you expect to file for FDA approval process for this?

It would probably be some time in the middle of ’09.

And, this would be a PMA?

I believe it’s actually 510-K, but it’s going to require clinicals.

Alright. Mid 2009 and then would that be a 9-month to a year approval process? I am sure this is…

I don’t know

To be a short…?

I am not going to comment on any of those.

Yes, probably best. Okay. You mentioned the two factors that are advantageous to the Trophic products. Are we having the need for pumping and increasing the number of days that you could implant from 3 to 6?

Yes.

Are those necessarily – do they have to go together, or could you say well, we don’t need to pump, but we still have three days, or maybe we have 4 days and you don’t have to pump or if we do pump you can extend it to six days, is there some combination and middle ground that that is possible?

Now the early testing of the product has shown that you can keep a kidney viable for six days without pumping. And, that is well documented in the papers that the inventors have published. The reason and that particular study was done head-to-head with what’s called a Belzer solution, which is a typical solution that is used when you are pumping kidneys. It’s different from the UW solution that is typically used for transporting kidneys over shorter timeframes. And, we wanted to have a head-to-head comparison between the Trophic solution and UW because UW is the solution that is used more frequently than Belzer, so that we can comment intelligently on how our product will relate to both pumping of kidneys and also the kidneys that are just cold storage and shipped that way.

Increasing to 6 days from 3, how much can that expand the market?

I don't know the answer to that question, but every transplant surgeon I have talked to about it uses only one word to describe the impact on his specialty and the word is “huge”.

All right. Well, we'll take that. You’ve got a lot of data here potentially in the Trophic Solutions, a lot more data I believe in SynerGraft. When will that be and how that be available to investors and analysts to review?

If you wish to have any information on the published data on Trophic, you can just call Investor Relations and they will copy the published papers and send them to you. And, can we do that with the data that we send to the FDA? I don’t know if that’s public or not. I am going to have to ask about that. I believe actually that there is a paper highlighting the results of the data that we sent to the FDA has been accepted for presentation at the Western Thoracic.

Has it been accepted?

I believe it’s been accepted and if that’s the case then we could certainly make that available.

Okay, that will be great. I’d love to see both of those. And, then finally perhaps the Western Thoracic conference or something would be a forum, but where can the analysts and investors see CryoLife present its products next? You had any scientific conferences?

Well, the next scientific meeting that we will be going to is the AATS, American Association of Thoracic Surgery, and I believe that’s in April. But, you can check that out on our web site. If you click on to our web site there is a list of all the trade shows and medical convention that we're going to both in the United States and internationally.

Al right. Well, I hope to see you all again soon. Thank you and congratulations again.

Thank you.

There are no further questions in queue at this time. I would like to turn the call back over to Mr. Anderson for closing comments.

Okay. Thank you very much for joining us and we look forward to talking to you next quarter.

Ladies and gentlemen, this does conclude today’s teleconference. You may disconnect your lines at this time. Thank you for your participation and have a great day.