Good day, everyone, and welcome to the Hologic Inc. Second Quarter Fiscal 2013 Earnings Conference Call. My name is Jessica, and I'm your operator for today's call. Today's conference call is being recorded. [Operator Instructions] I would now like to introduce Deborah Gordon, Vice President, Investor Relations, to begin the call. Please go ahead.

Thank you, Jessica. Good afternoon, and thank you for joining us for Hologic's second quarter fiscal 2013 earnings call. The replay of this call will be archived on our website through Friday, May 24, and a copy of our press release discussing our second quarter results, as well as our third quarter and fiscal 2013 guidance, is available in the Overview section of the IR section of our website. Also in that section is the PowerPoint presentation related to the comments that will be made during today's opening remarks. Before we begin, I would like to remind you that certain statements made by Hologic during the course of this call may constitute forward-looking statements. These statements involve known and unknown risks and uncertainties that may cause actual results to be materially different from any future results implied by such statements. Such factors include those referenced in our Safe Harbor statement in our second quarter fiscal 2013 earnings release and in the company's filings with the Securities and Exchange Commission. Also, during this call, we will be discussing certain financial measures not prepared in accordance with Generally Accepted Accounting Principles or GAAP. A reconciliation of these non-GAAP financial measures to the related GAAP financial measures can also be found in our second quarter earnings release, including the financial tables in the release. Please note, today's call will consist of opening remarks from management, followed by a 30-minute Q&A session. We do need to limit each participant's questions to just 1, with 1 related follow-up as necessary. However, please feel free to go back into queue, and if time permits, we'll be more than happy to take your questions at that time. I would now like to turn the call over to Rob Cascella, President and Chief Executive Officer.

Thanks, Deb, and good afternoon and thank you for dialing into our second quarter call. Joining me on today's call is Glenn Muir, our Executive Vice President and Chief Financial Officer; Peter Soltani, Senior Vice President and General Manager of Women's Health; and David Harding, Senior Vice President and General Manager of International Operations. Today, we're going to summarize the second quarter results. I'll give you an update on our 3D tomosynthesis. We'll also discuss our Diagnostic franchise, including where we stand with the integration of Gen-Probe and our progress in achieving targeted synergies, and provide a brief overview in some of our other key businesses. I'll then turn the call over to Glenn to discuss our financial results and guidance. And then as Deb said, we'll open the call up for Q&A. Before I begin, I would like to put into perspective the quarter's results and how they relate to our overall business thesis. Although we experienced some volatility in our second quarter revenue, our business fundamentals remained solid. This quarter's revenue shortfall was caused by a few specific events, which I will detail momentarily. But the longer-term opportunities Hologic represents have not wavered a bit. Tomo uptake is extraordinary, given external circumstances. The Gen-Probe acquisition has significantly strengthened our Diagnostic business, and the added synergies we've been discussing with you are becoming a reality. The mid- to long-term growth profile for Hologic is extremely attractive across multiple product lines. We have assembled the necessary products to drive sustainable growth and have a solid business case for each of our franchises. I'll now turn to some of the details in the quarter. Glenn will discuss this in much greater detail, but in summary, adjusted Q2 revenues were $619 million. They were 31% higher than last year, though below the…

Thank you, Rob. Second quarter non-GAAP consolidated revenues increased 31.4% due to the addition of Gen-Probe, and foreign currency had a negligible impact on revenues. On an apples-to-apples basis, pro forma revenue growth was flat compared to the prior year, when adjusted to include Gen-Probe for Q2 of last year and to exclude divested businesses, such as LIFECODES and Adiana, in both quarters. I will detail the reasons, starting with our largest segment. Diagnostics revenues represented 49% of total revenues this quarter, increasing $151.1 million or 99.5%. On a pro forma basis, which includes Gen-Probe revenues from a year ago and excludes revenues from our divested businesses, Diagnostics revenues were essentially flat, and below our forecasted pro forma growth of low- to mid-single digits. We experienced a sharper decline in the legacy Diagnostics business than expected, which was offset by growth in the Gen-Probe molecular business. Within our legacy Diagnostics business, the overall ThinPrep revenues declined 7% year-over-year, caused mainly by a shortfall in China and lower major lab purchases in The States. The China shortfall was largely due to the disruption caused by our restructuring of our sales channel. The purpose of the restructuring is to provide broader coverage into multiple market tiers and provinces as we introduce our expanded portfolio. We believe this is recoverable, but it will take some time. In addition, as Bob indicated, in the U.S., we experienced a larger-than-expected decline in ThinPrep volume due to delays in orders from large lab customers, leading to a decline in volumes beyond what we would normally expect as it relates to interval expansion. The good news is ThinPrep is gaining market share as a result of recent competitive wins against our major liquid-based cytology competitor, who continues to be challenged with regard to HPV testing from their…

Thanks, Glenn. Just a couple of closing comments. I'll say once again, the fundamental pillars of growth for our business remain strong. Tomo is poised to become the new standard of care in mammography, and all indicators continue to reinforce this outlook. Our portfolio approach, proprietary assays and superior automation position our Diagnostic business to enter new market segments and drive growth over the long term. Although MyoSure is in the early stages of the successful commercialization, we believe it has the potential to accelerate growth of our Surgical business. As a result of these positive indicators, we are reflecting a stronger second half of the year. However, when considering the GAAP required to maintain guidance in light of the U.S. healthcare concerns and unstable European market and a slowdown in all the key parts of the world, we believe it is only prudent for some moderator optimism. Over the mid to longer term, our current product portfolio and development pipeline will drive sustainable growth for Hologic and will continue to be complemented by our strong profitability and cash flow. I want to thank you for your participation on the call and have the operator open the call up for questions. Thank you.

[Operator Instructions] And our first question will come from David Lewis from Morgan Stanley.

Rob, I appreciate your comments on the macro environment, and I think everyone knows it's challenging. But I think one of the stated objectives for management in the last couple of quarters has been guidance was conservative, and obviously, it wasn't as conservative as you hoped. So I guess the first question, can you just explain to us your approach to guidance for the remainder of the year? And how do you convince shareholders that this guidance frankly is achievable?

Sure. And I think it's a very fair question, David. First off, I think we have strong confidence in our earnings numbers. I think we've done a good job at maintaining costs and expenses, and we are seeing the cost synergies from the Gen-Probe acquisition materializing at a faster rate. More importantly, from a revenue perspective, the things that we commented on, in both my script and Glenn's, has been, on the Breast Health side, we have an increase in backlog, which we believe relates to additional bookings and also, obviously, revenue for the second half of the year. And the other side of what we talked about on our Diagnostic businesses, we have a large number of competitive takeaways. We have market penetration in new areas within the Diagnostic market, all contributing to what we define as our second half revenue. Now keep in mind, our second half has always been stronger. We average somewhere between 3% to 5% higher in the second half than the first half. In this analysis and in this guidance, we are averaging around 3% for fiscal '13, and we're basing that on the strength of what we just saw with bookings rate and backlog in Breast Health, as well as the competitive takeaways that have not yet made their way to revenue on the Diagnostic side.

Very clear. Maybe a follow-up on guidance as well. Your fourth quarter revenue guidance, implied revenue guidance, it looks like it's in line with your historical cyclicality, which you basically just mentioned. The EPS number though, for the fourth quarter, does look stronger than we would normally expect. And if I'm reading that right, and are there any reasons why the fourth quarter earnings number would be materially stronger than the third?

Yes, it's a little -- a fair question. And it's a little bit of some of the things that we talked about earlier. When we look at our -- the ability to leverage costs and expenses, it is completely driven by the fact that not all of our cost basis is fixed -- or variable, I should say. And as a result of that, as revenues increase, not only do we get favorable impacts in manufacturing, but we also are able to leverage the fixed operating expenses, so that our profitability, our operating margin changes by percentage points as a result of that. And that's just math. 90% of our operating expenses are fixed and don't move with revenues. So as we generate higher levels of revenue, it changes the metric relative to our operating returns.

And we'll now move to Richard Newitter from Leerink Swann.

Just maybe, Rob, could you -- last quarter, I think you had some of the same dynamics playing out in the Breast Health division, and you kind of saw a strong backlog of 3D and the trends in 2D, but you left your guidance unchanged. Now you've made some assumptions, clearly, about what kind of acceleration in -- or impact from the deferral of 2D. One, can you quantify what that is for the back half, what kind of year-over-year decline do you think you'll see in 2D? And then two, what gives you confidence that it won't necessarily be worse than what you're anticipating right now, since it was a little bit worse than what you had anticipated as of last quarter?

Yes, I think it's a very fair question. As we indicated earlier, it looks as if the 2D fall-off rate is about 20%. We're not expecting that to be dramatically different for the balance of the year. I don't see it improving, and in fact, we're trying to manage it from an erosion perspective. What we're doing defensively, quite frankly, in order to shore that number up, is to really look at the low end of the market, with a lot of the used Selenias that we now have in on trade from our 3D dimension sales, and going after the low end markets in different parts of the world, as well as the low end market that has not yet converted here in the States. Again, as we look at the change in mammography, I think from a positive perspective, we're seeing great quote activity, we're seeing a lot of interest in 3D, but it is causing the 2D replacement market to stall. And what we're doing now is trying to mitigate further erosion with some of the measures that I just talked about. And they're very, very tactical.

Got it. And just a quick follow-up. I may have missed it, but did you provide kind of where you stood with respect to your original kind of initial adopter, 500 to 700?

We said we were very pleased that we made the range that we had given for the first 2 years after FDA approval and, more importantly, that we were also confident in our more than doubling of the installed base for fiscal '13.

Off of what level?

Off of the level that we ended fiscal '12 at. So if you did the math as to where we said we were at, which was 60% of the range for fiscal '12, we said that we would more than double the aggregate installed base of tomo units in the United States in '13.

And we'll now go to Tycho Peterson from JPMorgan. Tycho W. Peterson - JP Morgan Chase & Co, Research Division: Just looking at the quarter, I don’t think anybody's surprised by the utilization pressures or the comments on 2D mammo, but can you talk to the China dynamic, $8 million hit from the restructuring? I guess just give us some conviction that, that will recover in the near term, and maybe just a little bit more color on the steps you took there.

Sure. I'll have David Harding comment on those as well. David?

Yes. Thank you. So we made a concerted decision at the beginning of Q2 to restructure our Diagnostic sales channel in China. We believe that in order to really maximize our growth in this attractive market, we must have a hybrid distribution model made up of both direct- and dealer-based channels. So as we move into a broader set of geographies, we really have to think about redeploying our direct sales teams to the areas of greatest potential and leverage dealers in other markets. The change in the sales channel structure obviously resulted in some sales team disruption and impacted our customer ordering patterns, in what is already a pretty challenging seasonal period due to the lengthy Chinese New Year holidays. To be very specific, we had sales leaders out of the field for certain periods during this restructuring. New dealers had to be qualified, brought on board and trained, and customers had to become acclimated to their new primary contacts, in some cases. And all of this took its toll on the numbers. During our continuing work to optimize the sales channel, we will also be rationalizing our expense profile, so that the overall China profitability remains strong. And as we move into the back half of the year, we're confident that we will drive revenue growth, because I think the fundamentals of the China market are really quite attractive. And while it's highly competitive, it's a great geography as the government continues to invest to broaden healthcare coverage. So we're confident that our revenues will continue to grow. Tycho W. Peterson - JP Morgan Chase & Co, Research Division: And then Rob, are you able to give us any color on mix for the new tomo customers between academic centers, community hospitals? Just what's the customer profile evolving to look like? And also, any thoughts on C-View?

Yes, sure. I think that the -- and I'll let Peter comment on C-View. I think as far as mix, I think we're seeing many more commercial sites versus academic sites buying tomo today. There are sites that are buying it because they believe in the technology, they believe in the marketing power behind the product as well. And there are sites that are interested in gaining market share within their regional markets. Peter, you may want to give an update on C-View.

Sure. The -- we're really just waiting -- it's pretty simple. We're just waiting for FDA approval, and we expect that, that will be forthcoming very, very soon, hopefully within a few weeks. Tycho W. Peterson - JP Morgan Chase & Co, Research Division: Okay. And then a quick one for Glenn, and then I'll hop off. You have 1 fewer week in the fourth quarter this year, so I just want to make sure that, that was factored into the segment guidance that you gave earlier.

Yes, it was. Tycho W. Peterson - JP Morgan Chase & Co, Research Division: Okay. So are you able to tell us what the segment assumptions are for the fourth quarter then, given 1 fewer week?

From a revenue growth standpoint, Tycho? [Technical Difficulty]

And we'll move to Amit Bhalla from Citi.

Glenn, why don't you finish Tycho's question, then I'll ask mine? It was revenue.

Yes. I think he's talking about revenue. So I think when we get to Q4, we are -- we have tailored our revenue expectations down to the point that, for the fiscal year, we're at low single digits almost across the board in each operating segment. So the extra week, as we talked about before, doesn't really affect any of the capital equipment businesses. It really is on the Diagnostic side of things. But that has been taken into account in the current forecast.

Okay. My questions are -- I don't understand this comment you made about the China decision. How come, Rob, you didn't factor that in when you were giving your guidance for fiscal 2Q? This -- a change in sales like that just doesn't happen overnight. So can you explain that? Why didn't you factor it in? Why didn't you tell us about it last quarter?

I think it might be a small oversight, and what I mean by that is I think that we thought that much of this could be done in a much more accelerated time frame. But what we really didn't account for is the customer side of the disruption. We knew that the field would be upset because territories were more compressed, the validation process on dealers that we had already identified we thought would be more accelerated. So we had planned this in Q1. We began kicking it off in Q2. And yes, we should have known better. I don't think we anticipated the complications that the market in China would have represented, because we do this all the time in different parts of the world and felt like we had a good process and a good roadmap to affect it.

And then my follow-up on Diagnostics. Can you talk about how your -- what your assumptions are for the pricing environment for the remainder of the year in this low single-digit growth assumption? I mean, competition is getting a little bit tougher. What are you thinking about in terms of pricing?

Well, it's all over the map, right? I mean, I think -- and in the case of ThinPrep, we have a very strong franchise and great market presence. So we're obviously tuned in to taking share away. I think that's incremental revenue for us. So it will be at a more competitive price, but it shouldn't erode our current pricing structure. I would say that in the case of Diagnostics, we have maintained pricing relative to our CT/GC business. In the areas where we're going after market share, namely in HPV, we have gotten much more aggressive. And you are absolutely right. I think the likes of our competitors in this market are getting very aggressive. I think what we're bringing to bear and what I think has been resonating with our customers is really the power of our automation and the broadness of our menu. I think all of that, linked with the fact that we have this universal transport medium or vial, is giving them a very efficient way for generating high-volume revenue within their labs. So there's a lot of operational efficiencies that we're able to talk about, which allow them to improve gross margins beyond just simple pricing, and that gets back to our automation and this vial strategy.

We'll now move on to Isaac Ro from Goldman Sachs.

I was just hoping to get an updated snapshot on your x U.S. footprint, specifically just given your China comments. Curious to know a couple of items. First off, just could you maybe ballpark the percentage of sales that you generate in China at this point? As I recall, Asia was about 9% in total and just trying to put that $8 million number in context. And then maybe if you could put some color commentary on the rest of the BRIC nations, Brazil and Russia, that would be helpful.

Yes. So I think that's about right in terms of a revenue number for China. We look at about 26% of our overall revenues coming from the international market, and China represents a fair chunk of that. So in about that 9% range is more or less accurate. In terms of our overall footprint, our China headcount is large. It represents a major piece of our overall international footprint and will continue to be that way going forward. In terms of the other BRIC nations, they are less peopled, but are very important. If you think about the overall employee footprint, it's largely concentrated in Europe and in China, but we continue to expand in places like Brazil, where we have a lot of excitement going forward. In Russia, we have a few people that cover that market, but it's largely a dealer-based channel. In India, again, a small number of people, largely driven by dealers.

Sorry. Just to clarify, as I understood it, all of Asia was 9%. Is that incorrect?

That is correct. So China would be a slightly smaller chunk of it.

And it's about 2/3 of it.

Yes.

Okay. All right. That's helpful. And then if I could just sneak in a follow-up. On just the picture in Gen-Probe, obviously, you guys have a bigger channel than they did. Can you update us on where you are in distributing Gen-Probe's products, specifically in Europe and Japan?

I think that for the most part, the European team is trained. We've had good success in terms of market growth, as I indicated, even our very mature CT/GC business was up 15% on a pro forma year-over-year basis. So we're pleased with the uptake. On an international basis, we're probably seeing, I think, equal successes in different markets, but we are going through product registration processes that can take 6 months to 1 year to complete. So the market that we are most successful in today is Europe, but we believe that, that will branch into China and Japan over this next year.

Yes, just to add a little bit. This is David. We are, in fact, transitioning to our direct business in Japan. So that will take place in the coming quarter, and we feel that we can drive a lot of incremental sales as a result of that. In China, we are still awaiting registration and approvals from the Chinese government, before we can begin fully deploying our sales team there against the core Gen-Probe product line.

And we'll now go to Vijay Kumar from ISI Group.

I wanted to touch on the whole reimbursement discussion. You mentioned that you had your -- initially met with CMS. You were also in talks with private payers, and there has been some question marks in the marketplace, where the 3D tomo wouldn't necessarily get a $50 incremental. And people often cite cost benefit analysis. And I'm just curious if you could comment on this thought and sort of how those initial discussions have gone relative to your expectations.

I would say that the -- and Peter will comment as well. Of course, I would say that private pay is very interested in a cost benefit analysis. And, in fact, that is the reason why, irrespective of the timeline with CMS, that we have private pay interest. I mean, look, we can reduce the number of callbacks, we can reduce the number of unnecessary biopsies. And, in fact, just the fact that we find more cancers earlier saves money. So that part of the argument works very, very well. And our modeling around that argument, I think, is compelling. With CMS, I think it's really going to be a matter of really suggesting that this is a beneficial technology. And, in fact, it's not as much about cost savings as it is about patient benefits, particularly the Medicare patient population, because that's what their focus is. And we've been able to effectively demonstrate that there is a reduction in recall and higher sensitivity, even with Medicare. And, in fact, in some studies, it's been enhanced for Medicare patients as well. Peter, you may want to add...

Well, I would just emphasize the importance of the health economic aspects of tomo and some of the additional burdens, in terms of equipment costs and the reading physicians, that would warrant an additional reimbursement. So, again, we're very optimistic that we'll get the right outcome.

Great. And now I just want to go back to the China restructuring. Not to beat a dead horse, but I mean, if you look at the competitor commentary, utilization in the U.S. is down anywhere from mid- to high-single digits. And if you look at the magnitude of miss, $4 million in the U.S. versus $8 million in China. Can you just talk to us -- like what gives you the confidence like those steps can be remedied? Like what's the time frame which it's going to take for sales to come back?

I think we're very confident that sales are going to come back in Q3. If you just sort of look at the pattern, Q1 was very strong. As you know, Q2 is seasonally very weak, in general. And then add on top of it these restructuring activities, we're very confident that it's going to pop back in Q3 and Q4.

I think the other point we might make when we think about China and the miss on China is just to restate that, that is actually a miss from what we had been forecasting to do in that territory as opposed to a comparison with the prior year. I mean, the China business was still a strong business. It is down a little bit year-over-year, but the miss that we're talking about was our expectation for continued revenue ramp in this particular quarter. So it still is a great business for us.

And we'll now move to Doug Schenkel from Cowen and Company.

My first one is really a math question. I want to take a different angle on a question that was asked earlier. You've cut your total full year forecast for operating spend by just about $35 million. It sounds like almost half of this is incremental Gen-Probe synergies. Is the balance simply the drop through on a lower revenue number? Or are there other areas you've cut? And then building off of this, it seems like your operating spend will be, by far, the lowest in the fourth quarter, I believe around $180 million. This implies incrementals in the 70s. Is there any reason we shouldn't be cognizant of that as we contemplate how to model out spend in subsequent quarters and, for that matter, operating cash flow? I just want to make sure there's no calendar effect on expenses or some expense that was pushed out of this fiscal year into next.

Yes. I'll give you one summary on just the balance in addition to Gen-Probe synergies, and they will happen overtime over the course of this year. And, in fact, some of those involve facility closure and so on and so forth. So you may see an uneven weighting from 1 quarter to the next. But in addition to Gen-Probe, we've taken a hard look and have continued to take a hard look at all of the businesses, and are looking at areas where the company may have had an excessive expense structure or unnecessary costs and expenses and so on and so forth. So we have very selectively, over the last 6 months, have been doing much to consolidate. We closed another facility and we announced that earlier, not this quarter. That had nothing to do with the Gen-Probe business. It was all part of the biopsy business. And all of that is an effort to try to consolidate facilities and personnel. But Glenn, you may want to comment on the balance of what's in the year.

Yes. No, I think Doug hit it right on. When we look at our expense forecast for the remainder of the year, it does, number one, now include the Gen-Probe cost synergies, which are much better than when we started the year. We are now seeing just over $60 million for the full fiscal year in Gen-Probe cost synergies. That was factored in, as well as these overall Hologic cost initiatives, saving initiatives. So we don't tend to add expenses even though we had revenue growth in our original plan. We don't add hiring or expenses in advance of that revenue. So we were very aggressive in dialing it back for Q3 and Q4. So when we look at Q4, Doug, it is a range of expenses, but the $180 million you quoted is within that range that we would be expecting. There's really no onetime expenses that are lower that we would point to. If I look at FY '14 though, and I think you're alluding to what -- how to model it going forward. As a reminder, we all know Q1, we are hit with some higher marketing expenses for RSNA, but that's not really the point. I think if we get to FY '14 and we begin to trend up on the revenue side, well, at that point, the operating expenses will increase. So they won't stay at a low level of Q4, hopefully, forever. I would expect them to begin to trend up, but that trending to trail our revenue growth. Right now, we're looking at operating expenses at 30% of total revenue. So we've constantly lowered that from 33% down to 30%. So we've made great strides on the cost side, which you can imagine with -- on the gross margin side, leaves us with operating margin now well over 30%. So we're in the 31%, 32% for operating margin before tax. So we're in a pretty good situation from that standpoint. I would also point out with some of these cost savings, not all of the savings affect just operating costs. There will be a little bit of a gross margin improvement as well, with some of these cost initiatives. So we actually do have a greater sense of comfort when we give guidance, on the gross margin guidance we gave of approximately 63%. So I think Q3 and Q4, from an earnings standpoint, we would expect to continue to look fairly strong.

Okay, that's all really helpful. And I guess if I could ask a follow-up or, really, a separate question on ThinPrep. I know it wasn't the best quarter, but at the same time, you talked about share gains, which, for what it's worth, is consistent with what we've heard about in some of our recent checks. What inning do you think you are in this initiative? And how do you weigh the risk that a customer who's inclined to move to APTIMA HPV might not, because co-testing isn't available to them on another platform from a competitor? And are you still planning to seek approval for co-testing on non-ThinPrep vials?

Yes, sure. I think to the first part of the question, I think we're really early on. We're probably 2 quarters into what we defined as a much more aggressive campaign to really go after account conversions. Our intent would still be to get validated for the SurePath vial. I think the difficulty today is that no one is, and I think that's what's created some of the issues. So we recognize that that's part of the market, and we certainly don't want to have an impediment against our APTIMA HPV because of that limitation.

And we'll now go to Bill Bonello from Craig-Hallum.

So I just have a question, too, on the Diagnostics business. In terms of cervical cancer overall, I mean, as you look down the road, do you view this as a growing product area for you? In other words, can the gains in ThinPrep share and the growth in HPV, is that enough to offset the accelerated interval expansion in cytology testing, in general? And sort of if so, how do you think about the potential growth in that business overall?

Yes. I mean, look, it's a very fair question. We think, over the next 3 to 5 years, that there is an acceleration in the erosion of the U.S.-based cytology business. But we also think that co-testing becomes a much bigger part of that market from an HPV testing perspective. So there is a bit of normalization even though the interval expansion could be 3 years or more. And I know some of our contemporaries have commented on what doctors now are complying with, those guidelines. More importantly, however, is that we see pockets of growth for both product lines in different parts of the world. We think that there are markets that have not made a decision outside of conventional Pap, that are substantial markets, Germany, for instance. We think that the market penetration in a place like China is very early on. For that matter, Japan is very early on. And that's probably -- some of those are not markets where co-testing will prevail, and they will either be cytology markets or they'll be HPV or DNA and genetic testing market. I think beyond that, Latin America is wide open as well, and we see those as opportunities. So I don't -- I think if we look at the cervical cancer screening from a U.S.-centric perspective, I think it ends up becoming a trade-off. I mean, we are winning today and growing that business quite simply because we don't have much of a presence in HPV, and we are changing that. But without a doubt, the cytology market will decline as a result. Now we can gain more share, but at some point, the cytology market erosion in the U.S. will outpace the ability to gain more share in the U.S. Where we see the opportunities for both of those products is on a global basis. And that's where I think that, if we start looking at the future, and what I mean by the future is maybe the next 3, 5 and even 7 years, I think we see stronger growth on an o-US basis for either one of those products than where we are standing today.

Okay, that's very helpful. And then just when I think about your PANTHER placement and the competitive wins that you talked about, how is that playing out in terms of kind of what you expected for PANTHER placements and wins when you first contemplated doing the Gen-Probe acquisition?

I'll answer 2 ways. I mean, one, just from a metric perspective, we're ahead of plan relative to placements. Two, the product is extraordinary. I talked about workflow benefits and operational efficiencies. I talked about the ability to now add menu to that product. It has been so well-received in each of the scenarios that we have applied it to, that it gives us great confidence about just the overall potential of that product from a longer-term perspective. So I think one, again, reiterate, it's exceeded expectations. And, in fact, we believe that when HPV is approved on PANTHER, that not only will we close more HPV accounts, we'll close more CT/GC accounts with it, because what people are waiting for is a complete STD menu on that product. And it has the capabilities to do that. And it has the features and functionality to make random sampling a reality, so that you get workflow efficiencies, as well as a full menu. So we're ultimately -- and if you haven't gotten it from my comment, we're ultimately very, very excited about it.

We'll now go to Anthony Petrone from Jefferies Group. Anthony Petrone - Jefferies & Company, Inc., Research Division: A couple on Gen-Probe. I don't know, Glenn, if you can just review maybe the blood screening trends in the quarter. And maybe a higher-level question, can you review what major contracts are still up for bid this year on the blood screening side? And then I have a follow-up.

Yes, there's really not a major bid up for this year. That's a fairly stable business. And for this year, we're looking for it to be up 2%. So it actually dragged down. I commented on Gen-Probe being up 6%. Well, the blood screening did drag that percent down a little bit. But that would look to be stable. The growth in blood screening will come in the future, especially if you look at some of the Asian countries out there. China has some tenders out there. There's one in Thailand, we're working on, I believe. But those are all -- they don't kick in for a couple of years. There's one for Japan that they're looking at. But once again, these are a couple of years out. These are long-term contracts at this point. Anthony Petrone - Jefferies & Company, Inc., Research Division: That's helpful. And then just a follow-up there on the operating cost side. You mentioned the $50 million or so in cost savings through this year. Can you just review for us what are the savings from LIFECODES, the sale of LIFECODES and how much is in that $50 million number? And then just what type of portfolio pruning potentially could you see later in this year that can also help that number?

Yes. Well, we did include -- there was a little bit of disconnect concerning LIFECODES last quarter, because we did not anticipate owning it beyond December and had to readjust our cost guidance -- cost expense guidance for the full fiscal year. We increased it by $10 million to take into account having LIFECODES for this quarter. And we hit just under that. I mean, the actual expenses at LIFECODES in Q2 were $8 million or $9 million on revenues of a little bit over $11 million. That's now done. So when we look at the remainder of the year, that LIFECODES is kind of already reflected in our full year's forecast of $760 million to $770 million. As we look at pruning, we have pruned the big pieces at this point. We always look at the portfolio, and we'll continue to do so. But I don't see another big piece that will come in play this fiscal year.

And that's all the time we have for questions. I'll turn the conference back over to our presenters for any additional or closing remarks.

I just want to thank everyone for their participation and questions, and we'll update you during the course of this next quarter. Thank you.

This concludes today's presentation. Thank you for your participation.