Hello, ladies and gentlemen, thank you for standing by, and welcome to Myriad Genetics First Quarter 2018 Financial Earnings Conference Call. Now, during today's call, all participants will start in a listen-only mode, but later, we'll conduct a question-and-answer session. Please note, today's conference call is being recorded. And it is now my pleasure to introduce Scott Gleason. Please go ahead, sir.

Thanks, David. Good afternoon, and welcome to the Myriad Genetics fiscal first quarter 2018 earnings call. My name is Scott Gleason and I'm the VP of Investor Relations. During the call, we will review the financial results we released today, after which we will host a question-and-answer session. If you've not had a chance to review the earnings release, it can be found in the Investor Relations section of our website at myriad.com. Presenting from Myriad today will be Mark Capone, President and Chief Executive Officer; and Bryan Riggsbee, Chief Financial Officer. This call can be heard live via webcast at myriad.com. The call is being recorded and will be archived in the Investors section of our website. In addition, there's a slide presentation pertaining to today's call on the Investors section of our website and which will be filed following the call on Form 8-K. Please note that some of the information presented today may contain projections or other forward-looking statements regarding future events or the future financial performance of the company. These statements are based on management's current expectations and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time-to-time with the Securities and Exchange Commission, specifically the company's Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and its current reports on Form 8-K. These documents identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. With that, I'm pleased to turn the call over to Mark.

Thanks, Scott. I would like to start today's call by providing key business and financial highlights from the first quarter of fiscal 2018, after which Bryan will provide an overview of our financial results and guidance, and I will finish by providing additional details pertaining to the ongoing execution of our business strategy. The first quarter was a strong start to the fiscal year and exceeded our expectations on both the top and bottom line, with total revenue of $190 million and adjusted earnings per share of $0.26. These results were primarily attributed to continued strong hereditary cancer volumes and GeneSight growth, with both exceeding our forecasts. During the quarter, we again made significant strides on our five critical success factors of stabilizing hereditary cancer revenue, growing new product volume, expanding reimbursement for our new products, increasing international RNA kit revenue and improving profitability with Elevate 2020. From an hereditary cancer perspective, we continued to see strong sample trends and exceeded the 3% volume growth contemplated in guidance, which represents the third straight quarter of year-over-year volume growth. In addition, hereditary cancer pricing was in line with expectations following the signing of long-term contracts in the second half of fiscal year 2017. This past quarter, we launched riskScore, which we believe represents the fourth major epoch in hereditary cancer testing. From a strategic perspective, riskScore broadens our competitive moat, while potentially facilitating deeper penetration into the preventive care segment. Based upon the timing of the riskScore launch late in the first quarter, it is still too early to quantify the impact, but we continue to believe that riskScore will be a positive catalyst for our hereditary cancer business. Related to our new product volume growth, test volume grew at a double digit rate in the fiscal first quarter, with GeneSight…

Thanks, Mark. I would like to start by providing a more in-depth overview of our fiscal first quarter financial results. First quarter total revenues were $190.2 million compared to $177.5 million in the same period in the prior year, an increase of 7%. This represents our fourth straight quarter of delivering positive year-over-year revenue growth. Hereditary cancer revenue in the quarter was $127 million and was down 9% on a year-over-year basis, which was ahead of forecast. We expect year-over-year pricing headwinds will moderate as we transition through the year based upon the timing of the signing of long-term contracts in fiscal year 2007 (sic) [2017], and the Anthem out-of-network decision which impacted the second half of fiscal year 2017. Looking at the components of revenue, our volume growth exceeded our 3% volume growth assumption in our guidance, while pricing was in line with expectations. GeneSight revenue in the quarter was a new record at $28.8 million and grew 54% year-over-year on an adjusted basis and 12% sequentially. Volume in the quarter achieved a new record despite the impact from seasonality. The strength of the business is underscored by the fact that we set a new record number with more than 12,000 physicians ordering GeneSight in the first quarter. Vectra DA revenue in the first quarter was $16 million, but as anticipated included approximately $4 million of revenue benefit due to the Medicare revenue carryover from the fourth quarter and a change to a new accrual-based accounting system consistent with ASC 606 guidelines. Excluding these items, Vectra DA revenue would have been up 5% on a year-over-year basis. Prolaris revenue in the fiscal first quarter was $2.9 million, which was flat on a year-over-year basis. Prolaris volumes continued to grow in the double digits in the fiscal first quarter, with…

Thanks, Bryan. I would now like to provide some additional details on important clinical data and our performance for the first quarter beginning with hereditary cancer. The most important event in the first quarter was the launch of riskScore which has been extremely well received by patients, genetic counselors and physicians. As a reminder, for patients of European descent, riskScore now provides a definitive breast cancer risk for 100% of patients, whereas only 10% of patients received definitive risks after testing with myRisk. As one Boston gynecologist stated and I quote, "riskScore is amazing and a major advancement. No other laboratory provides us with this type of support and makes this type of investments in our patients." While it's too early to quantify the impact of riskScore, we remain very encouraged by the qualitative feedback and we'll provide additional color during our fiscal second quarter 2018 earnings call. At the National Society of Genetic Counselors Meeting, we presented our first major validation of the SNP panel associated with riskScore. In a cohort of 17,205 women of European descent, the SNP panel was highly predictive of breast cancer risk with a p- value of 10-50. Our combined riskScore validation, which includes both the SNP panel and the Tyrer-Cuzick model will be presented at the San Antonio Breast Cancer Symposium in December. Lastly, we saw progress towards continuing to expand the indications for use for myRisk as NCCN now recommends hereditary cancer testing for all metastatic prostate cancer patients. Each year, there are approximately 26,000 men diagnosed with metastatic prostate cancer, so this represents a significant new market opportunity. Moving on to GeneSight, I would like to begin by reviewing the design of our recently completed large prospective study. To be eligible for this study, patients had to have treatment-resistant major depressive…

Thanks, Mark. As a reminder, during today's call, we will use – we use certain non-GAAP financial measures. A reconciliation of GAAP financial measures to non-GAAP financial results and a reconciliation of GAAP to non-GAAP financial guidance can be found under the Investor Relations section of our website. Now, we're ready to begin the Q&A session. In order to ensure broad participation in today's Q&A session, we're asking participants to please ask only one question and one follow-up. Operator, we're now ready for the Q&A portion of the call.

Certainly. First question coming from the line of Jack Meehan from Barclays. You may now proceed.

Hi, thanks. Good afternoon. I wanted to start with the hereditary cancer testing performance in the quarter. In the slide deck, you talk about the five volume drivers that drove the performance. Was there one that you think was most meaningful of them? And then, was there any impact from the hurricanes in the quarter to call out?

Yeah. Thanks, Jack. It's probably difficult to tease out of the five we mentioned which might be the most impactful. I think we've seen all of those have an impact. Obviously, a number of those initiatives are ones that we launched last fiscal year, and so we continue to see those play out. I do think the two that are on there that are of course new is riskScore. I mentioned qualitatively, we – that's been very well received by physicians and by patients, too early to quantitate that, but we certainly have been very pleased with the acceptance of that. I think the other one that continues to, I think, get more notice is just quality concerns that physicians have with other laboratories. And I think as testing volumes have increased from other laboratories, those concerns have only increased. So, we are seeing noticeable probably differences or concerns being raised by people about some of those quality differences. We of course saw an incident this past quarter that raised that even further. So I think that would be the one thing that I would say was different in that quarter, but has been increasing over time. From a hurricane perspective, obviously if patients are not going in to see the doctor or doctor's offices are closed which of course was the case in southern Texas and in Florida that obviously does impact volumes. So I know other laboratories have called that out. We certainly saw some impact with that. But as you can see, we were able to really just grow our way right through any hurricane impact.

Great. And then maybe just as a follow-up, thinking about guidance for the rest of the year and I know there's a number of upside drivers that you've laid out. But the next quarter would be $8 million on revenue versus the midpoint of guidance. Was there any thought about taking up guidance or what's the caution that you guys are thinking about right now? Thanks.

Hey, Jack. This is Bryan. I mean, I think a couple of things. One is, when we look at the quarter, we certainly had the $4 million positive and they are relative to Vectra DA. So, when we look at the sequential Q1 to Q2, we have that to deal with. But just in terms of how things played out in the quarter and how we feel about the rest of the year, I think our perspective is just that we're one quarter into the year at this point, we'll relook our guidance after we get through Q2 and see how we feel about it at that point.

All right. Moving to our next question, we have a question from the line of Doug Schenkel from Cowen. You may now proceed. Doug Schenkel - Cowen & Co. LLC: Hi. Good afternoon. I just want to ask, I guess, a few more questions on HCT volumes. I guess, one question in multiple parts. First, it looks like volume was up 5% to 6% year-over-year at least by our math. I'm just wondering if we're in the right neighborhood. Second, I just want to confirm that full year guidance still assumes that HCT volume growth is only around 3% in spite of the strong momentum coming out of Q1. Third, I was wondering if there was any impact from preauthorization efforts among some payers that picked up during the quarter. And fourth, along those lines, is there any concern that Anthem-related volumes could take another step down due to preauthorization efforts and your out-of-network status? Thank you.

Thank you, Doug. I think I got all of those, if not, obviously follow-up on those. From a volume standpoint, I think our commentary is just that we exceeded the 3% goal that we had set. And you're right, that is the goal that we had set for the year when we put our guidance together, was 3%. So, we exceeded that in the first quarter and we're pleased with the strength of the volume growth that we saw in that first quarter. Other than that, we're not necessarily providing any additional granularity on volumes, just to say that we did beat our expectations there. From a preauthorization perspective, one of the things, obviously we have seen these tests under preauthorization for many, many years. We have more than a decade's worth of experience of ensuring that there's appropriate preauthorization. So, I don't think anything for Myriad is particularly new; I know for some other companies that this may be new. But I think we've got lots of experience in working through that. We are seeing some payers use now more automated forms of preauthorization. I think there's been some upside to that, in certain payers we actually see the move to automated preauthorizations will actually reduce the amount of documentation that's required. So, that's obviously more efficient. I think we have seen instances where there's been at least one payer in particular that saw some speed bumps associated with their implementation of some more automated preauthorization processes. Our belief are those things are ultimately going to take care of themselves, it's not unusual for us to see that when a new preauthorization process is implemented. And our belief is that we'll be able to work with those payers to ensure that those processes become more efficient. So, we're not looking at the preauthorizations as really having any material impact on our business.

All right. We'll move to our next question, it's coming from the line of Amanda Murphy from William Blair. You may now proceed. Amanda L. Murphy - William Blair & Co. LLC: Hi. Thanks. Good afternoon. I just had a couple on GeneSight, so thank you for all the detail there. I guess I was curious, so there's obviously a bit of confusion around the data and whatnot. And you've had quite a lot of – there's clearly a lot of physicians using it, but there seems to be some question around how incremental, I guess, the test is in terms of treatment paradigm. So I was just hoping you could rationalize the two just in terms of the growth in doctor usage versus how incremental it is? And then also, I realize it's preliminary at this point with the data just coming out, but just wondering what your conversations have been like with private payers to date? What are they looking for? Are they looking for peer-reviewed data or would they consider evaluation of the top line? Thanks.

Yeah. Thanks, Amanda. Well, first of all, I think what we've seen with GeneSight is continued strong utilization from a number of physicians, and frankly it's because they see significant benefit in the test. Remember, these are treatment-resistant depressed patients, they have not responded to therapy, they have not entered remission. And the doctors are looking for any kind of assistance they can have in order to figure out what's the most appropriate medication for a patient that ultimately could return that patient to normal functioning. And they have seen tremendous value from GeneSight. So the fact that we continue to see repeat orders, record numbers of physicians, is a really very clear indicator of how much value they see in their patients, because they see, when they modify medication according to GeneSight, patients respond, patients remit and patients get better. And so I think that's what underscores the type of volume growth that we've seen, GeneSight is real world experiences that underscore their belief in how well the product has performed. I think the other thing I can mention is just what feedback we've already gotten from the field from doctors that have seen the top line results. It has been to a large extent extremely positive, in fact I know there was an analyst note to this regard as well. Doctors are very pleased that it hit remission and response rates, those are the things – the quotes we've got back from doctors are, those are the things I'm worried about, those are the things that are in guidelines and the fact that this product has met those endpoints is just confirmation that I've been doing the right thing and need to look for more patients for utilization of GeneSight. So the responses have largely been very encouraging…

I think what the size of this large prospective study with a multiple health economic studies in very large data set, so the MEDCO data set of over 10,000, again, real world data that shows exactly what the cost savings were. We'll also of course have the Optum data published as well that will show again in a real world study the significant numbers of savings. So, I think when you combine the power of those data sets, it's not clear that any additional data would be required by a payer. And so, our expectation would be that they'll take that data in its entirety and use that to make a coverage decision, that's generally a more exhaustive dossier than they've made previous decisions on. And so we think it's sufficient for them to make a coverage decision without that. And recognize with less than a one-year payback, these insurers are incented to cover GeneSight because they're going to see that return pretty quickly. The last thing I'll say from a payer perspective that they're highly sensitized to is much of their book of business is for fully insured employers. For United, for example, 70% of their book of business are fully insured employer groups. To employers, mental health costs are a very significant driver of overall expenses. So, to the extent that a payer can bring a program to a self-insured company helping to control costs, that's a very big competitive advantage for those payers as they approach other self-insured employers. And so we see a real interest not only from payers to do that, but also from PBMs that are looking for ways to differentiate their services and expand their market shares within the managed care space. So, I think for all those reasons, we would expect them to be able to make a decision without additional data. Amanda L. Murphy - William Blair & Co. LLC: Got it. Thanks very much.

Next question is coming from the line of Tycho Peterson from JPMorgan. You may now proceed.

Hey, thanks. Mark, I actually want to follow-up on some of the GeneSight questions. First, milestone payment was dependent on HAMD score. Why was it pegged to that as opposed to the response remission at eight weeks, given that the latter is a more clinically important one? Second, I know there were about 25 other secondary endpoints, anything to note in those and anything on remission and response at week 12 that came out in the data? And then the third is, on the payer front, if the improvement is primarily centered on patients that were on the wrong medication judged by GeneSight as the baseline or the red bin patients, is there any risk that the private payers may set more restrictive reimbursement criteria in order to get a greater mix of red bin patients in the patient pool, in other words maybe increasing the number of failed paramedication trials as opposed to CMS which just has one?

Okay. Thank you, Tycho. Once again, I will do my best to hit those all and if not, ask a follow-up please. First, just to be clear, response, remission and symptoms are all based on HAMD-17. So I just want to make sure that there's clarity with that for everybody. So all of those measures are looking at reductions in HAMD-17 scores. In the case of remission, you're looking at HAMD reduced from the entry point over 17 all the way down to below 7, for response you're looking at that HAMD-17 score below 50% reduction in that. And then symptoms is merely a continuous variable and looking at any reduction in symptoms. The reason that the clinical trial milestone was tied to symptoms is that in historical antidepressant studies, symptom reduction as a continuous variable is generally the easiest endpoint to hit, that was certainly the perception in this case. And so, we agreed that we would accept that as the singular milestone payment for this particular agreement was that on that symptom reduction. Now, obviously, the fact that the benefits were largely confined to a subset of patients who were known and that was obviously all in the data in Pine Rest, La Crosse and that data was available. But we accepted that as the sole endpoint because in a traditional antidepressant study, it is the easiest endpoint to meet. I think what is important to note is it was not the endpoint because it was the most important, it was really because as we negotiated the deal, it was perceived as the easiest. And I think that's an important distinction. That said, the other secondary endpoint, you're right, there's a plethora of those, Tycho. Those are things that will come out as we do the full data…

Okay. And then just one quick follow-up, on the GeneSight volume growth, how much were from new psychiatrists versus existing psychiatrists ordering more?

Yeah, I think it's both. We haven't discerned that. We haven't given that level of detail. But it's both, Tycho. We continue to see very nice repeat ordering pattern. We continue to open new store sales. And so we continue to see growth in those areas. One of the things that's probably inferred by your question as well is how much of that might be in a primary care setting and very little of that is primary care, our call point right now is mostly psychiatry. So, of course, as we get reimbursement, we will expand into the preventive care market, that more than doubles the market opportunity for this. And we haven't even scratched the surface in that preventive care market. So, those are things that we'll continue to plan as we look to reimbursement here in the near-term.

Okay. Thanks.

Next question is coming from the line of Bill Quirk from Piper Jaffray. You may now proceed. William R. Quirk - Piper Jaffray & Co.: Great. Thanks. Good afternoon, everybody. A couple of questions. I guess first, Mark, certainly recognize that riskScore is very early, but do you have any, even anecdotal evidence of perhaps some physicians who had moved to a competitor that are now open to reconsidering myRisk for example? Secondly, again for Mark, just thinking about the Optum study and also just United's recent decision not to cover GeneSight. I'm just trying to figure out did United get a look at the Optum data or did they make that decision prior to being able to see that, just trying to figure out if – kind of what's going on there? And then lastly for Bryan, if I'm doing the math right here, it looks like a 24% tax rate, what should we be thinking about that moving forward? Thanks.

Thanks, Bill. I appreciate the question. I think from a riskScore standpoint, we have definitely seen very positive feedback. We've seen physicians that certainly had contemplated or been using others that have decided that the product we're providing with riskScore is a much better option for their patients. So, we definitely have anecdotal evidence already of that happening and very positive commentary. So, we'll see how the numbers play out here, but I don't – I couldn't be more pleased with the launch of riskScore and what this has meant for the quality of conversations. I think our biggest opportunity since generally our market shares are so high in that segment really is deeper penetration into the market. And we've heard a lot of very positive commentary to that effect as well because they really feel like their discussions with patients a 100% of the time now end with a very clear plan of action. And so, I think that still represents the biggest opportunity considering a low penetration we have in that market already. I think from an Optum standpoint, Optum study obviously has not been published yet and so United would not have considered that as they were approaching their decision. There's a number of studies that would not have been considered by United. Obviously, the recent RCT, the IMPACT study, none of those would have been considered in what was a look back by United. And so, I think all of those three studies represent opportunities for us to re-approach United and ask them to re-evaluate their coverage decision. Taxes, Bryan?

Yeah. Bill, the tax rate is 24%. We actually guided on our last call to a non-GAAP rate of 23% for the year. Obviously, there's some fluctuation from quarter-to-quarter, but we believe we're right in line this quarter and we were consistent, we expect to be – we haven't updated that 23%. William R. Quirk - Piper Jaffray & Co.: Okay. Got it. Thank you.

All right. Gentlemen, there are no further questions registered. I'll turn the call back over to you.

Thank you. This concludes our earnings call. A replay will be available via webcast on our website for one week. Thank you again for joining us this afternoon.