Ladies and gentlemen, thank you for standing by. And welcome to the BioScrip Second Quarter 2015 Financial Results Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we'll conduct a question-and-answer session. As a reminder, this conference is being recorded on Monday, August 10, 2015. I would now like to turn the conference over to Lisa Wilson, Investor Relations for BioScrip. Please go ahead, Ma'am.

Good morning and thank you for joining us today. By now, you should have received a copy of our press releases issued this morning. If you have not received them, you may access them through the Investor Relations section at our website at bioscrip.com. Rick Smith, President and Chief Executive Officer, will host this morning's call along with Carter Pate, Member of the Board of Directors. On the call for the Q&A portion are Jeff Kreger, Senior Vice President, Chief Financial Officer and Treasurer; Chris Luthin, Chief Operating Officer; and Scott Davido, Chief Implementation Officer. The call may also be accessed through our website at bioscrip.com. A replay will be available shortly after the call and will remain available for the period of two weeks. Interested parties can access the replay by dialing 800-633-8284 in the U.S. and 402-977-9140 internationally and entering access code 21773453. An audio webcast will also be available for 30 days following the call under the Investor Relations section of the BioScrip website at bioscrip.com. Before we get started, I would like to remind everyone that any forward-looking statements made during the call are protected under the Safe Harbor of the Private Securities Litigation and Reform Act. Such forward-looking statements are based upon current expectations and there can be no assurance that the results contemplated in these statements will be realized. Actual results may differ materially from such statements due to a number of factors and risks, some of which are identified in our press releases and our annual and quarterly reports filed with the SEC. These forward-looking statements are based on information available to BioScrip today and the company assumes no obligation to update statements as circumstances change. During this presentation, we will refer to non-GAAP financial measures such as EBITDA, adjusted EBITDA, pro forma adjusted EBITDA, and adjusted earnings per diluted share. A reconciliation of such measures to the most comparable financial measures is contained in our most recent press release issued this morning, which can be obtained from our website at bioscrip.com. And now, I would like to turn the call over to our Board Member, Carter Pate. Carter?

Thank you, Lisa. Good morning everyone and thanks so much for joining us today. My name is Carter Pate, one of BioScrip's independent directors and Chair of the Audit Committee. In light of the significant announcements that the company made today, the board has asked me to briefly address the investor community. Since March of this year, BioScrip has strengthened its board of directors, adding four new independent directors to its seven-member board. The new directors who have joined me on the board include Dave Golding, Michael Goldstein and Chris Shackelton. The new members include persons with industry, operational and financial turnaround experience. What we found in our brief time is a company with significant potential and a strong core business, but that needs rapid and effective changes to its cost structure and financial flexibility. We've identified and engaged a leadership team that we are confident we'll be able to implement the board's plan. Our objective is to quickly and effectively drive meaningful change at BioScrip to improve the company's financial and operational performance and enhance value for the shareholders. Now with so many moving parts, our board will play an active role in overseeing the future of the company. And we are committed to achieving a successful outcome. As part of our efforts, the board has formed a financial improvement implementation committee of which I am the chair. The committee will oversee the initiatives announced today in relation to our financial improvement plan. But everyone in this organization from top to bottom will be held accountable for our progress in achieving the goals of our plan. Now, on a parallel path today, we also announced that the board will be working with the company's financial advisor, Jefferies, to evaluate a range of strategic alternatives. These alternatives could include among…

Thank you. And our first question comes from the line of Brooks O'Neil with Dougherty & Company. Please proceed. Brooks Gregory O'Neil - Dougherty & Co. LLC: Good morning. I was a little surprised I guess to say that there were additional write-downs on the bad debt. So, could you provide us with an aging schedule? And in particular obviously we're focused on the older AR. How much over 360 days, how much close to 360 days, et cetera? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Yeah, Brooks, hey, this is Jeff Kreger. Good morning. Brooks Gregory O'Neil - Dougherty & Co. LLC: Good morning. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Good morning. Our filing this afternoon will have the comparative aging schedule Q2 June 2015 as compared to the year-end 12/31. We've not made all the improvement that we expect. I think by year-end, we'll have a lot of our processes reengineered around our billing and collections and our intake processes. There has been incremental change from year-end till now. For example, prior to bad debt reserves, our gross days are down three days from 75 days at year-end to now 71 days. As a reminder, at the end of 2013, those were 78 days. So, we continue to have incremental improvement in our gross DSO. Chris Luthin, as Rick mentioned in his opening remarks -- one of his key areas of focus is going to be around the decentralized intake process we have and the billing and collections process that comes out of that. Chris, you want to add a little bit of color as to the reengineering efforts you're putting into place?

Sure, Jeff. Good morning, everyone. In my brief tenure with the company, I've been working very closely with the existing reimbursement team, and we're closely working with the field out in the branches to ensure that our intake is much cleaner, so our ability to bill is much improved, and that we can really improve our timing and collectability of all our accounts receivable. We have a good three or four initiatives, I'm beginning to really analyze that will be able to be impactful in a significant way as we move forward. Brooks Gregory O'Neil - Dougherty & Co. LLC: That's good. I guess, what I'm curious about, maybe both of you could chime in, maybe Carter could chime in as well is, at this point, we've had a relatively steady stream of AR write-downs, and I'm just curious if you think we're at the end of that now or do you think we should expect more in Q3 and Q4? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Brooks, I think by the end of the year, we'll be through our reengineering process around AR intake billing and collections. And I think we'll have a much better understanding of the entire situation by the end of the year. Brooks Gregory O'Neil - Dougherty & Co. LLC: Okay. I get it. Secondly, I'm curious – I guess, the way I calculated, adjusted, adjusted – I don't know how many adjustments we need, but let's just say those two Infusion segment EBITDA around $12.7 million, which is clearly better than what it was in the first quarter. I'm curious if anybody is willing to suggest that we could see further improvement in Q3 and Q4 or you think the bulk of the improvement we should expect to look…

Thank you. And our next question comes from the line of Bill Bonello from Craig-Hallum. Please proceed.

Great. Hey. Thanks, guys. Just some follow-up. The first thing I guess is, I just want two follow-ups to the questions that Brooks was asking. The first one is when we think about the AR, Brooks talked about sort of the adjusted, adjusted results. So, I just want to make sure the $2.5 million of – or negative $2.5 million of EBITDA, that assumes the full $15 million of bad debt as does the $4 million of Infusion EBITDA or how do we think about that? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Yeah. That's exactly right, Bill. Exactly as you stated it is correct.

Okay. And just a stab at what sort of ex-charge, I mean, is a run rate bad debt really $7 million or is it probably – will you just tell us? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Well, we've got modeled in the $50 million to $60 million EBITDA range that we're providing guidance for, for 2016 for next year, we've got modeled in about 3.2% of bad debt. So, we think we'd like it to be lower than that, but I think that by the end of the year, the expense rate for bad debt that we're going to experience as a company is going to be about 3.2%.

Okay. And then what – if I understand you right, what you're saying is in Q3 and Q4, we just don't know, is you're putting processes in, maybe there's some more cleanup, et cetera, so just can't necessarily count on that as being the go-forward range yet? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: That's exactly right.

Okay. So, that's helpful. Then the second question is Brooks asked Rick what can we expect the core business to be at the levels we've talked about, and Rick you said it's already there. Just for those of us that might be in the dark, can you tell us what the -sort of EBITDA margin on that core business is today? Richard M. Smith - President, Chief Executive Officer & Director: Well, it's essentially north of where essentially the – as Jeff Kreger built up the market, essentially pro forma, Infusion segment of 12%, or so, of EBITDA on a combined basis, the core Infusion adjusted EBITDA margins are higher than that level. And so they clearly have a stronger contribution to the bottom line.

Right. Any chance somebody would be willing to actually give a number? Richard M. Smith - President, Chief Executive Officer & Director: I think it's north – it's a blend – essentially, the mix is made up of essentially five different therapies with different margin profiles and payer profiles. But, essentially, the product gross profit margins on those therapies have been consistent over the last three years in terms of that profitability. And so we would expect that those would continue.

Okay. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Bill, I'm sure you've looked at it, but I'd direct you to slide nine in our deck, and in there you can see as we removed the chronic business, we've labeled that noncore asset divestitures. As we remove that chronic business which is losing money for us, and it's about 20%-ish, 25% of our business, it tends to dilute the margin of this much more desired core business. And again, if you look at slide nine, to me it's fairly clear, we've tried to show it clearly to our investor community, but that gets us back to that 7.4% fully-loaded EBITDA margin. And of course the overhead being 4%, you can kind of do the math there.

Okay. And the 7.4% fully loaded is still with the mix of sort of 40%-some core and the remainder chronic, post transition or whatever? Richard M. Smith - President, Chief Executive Officer & Director: Yes. Correct.

Okay. Okay. Good. That's extremely helpful. Then just outlook for cash burn, should we think of the $22.6 million of cash on the books as a level that you can build from from an operating perspective? Obviously, you've got the PBM money coming in. Are you benefiting to some degree from timing of working capital flows? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: No, I don't know that I'd target that as the amount we'll typically have in our bank account. We may; we may not. But I prefer to look at it this way. Our liquidity, currently, is solid. It's necessary for the go-forward business. We've got $54.4 million of liquidity today. The combination of $22.6 million cash in our balance sheet, plus the $31.8 million of capacity in the revolver, all of that's before any proceeds from the PBM sale, which, on a gross basis, those proceeds will be $25 million, of course minus broker fees and professional fees to sell the business. We feel that we have very ample liquidity to go forward and execute our financial improvement plan as described by Carter and Rick. Richard M. Smith - President, Chief Executive Officer & Director: In addition, the costs that we're taking out we would expect to have a positive impact on operating cash flow. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: We believe operating...

Okay. So... Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Go ahead. Richard M. Smith - President, Chief Executive Officer & Director: Yeah, go ahead. Sorry.

So, you don't see any need for diluted financing at this point? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: No, we don't.

Okay. That's helpful. And then just on the $35 million to $40 million of annual cost savings, that obviously includes you said a portion of the $9 million. How do we think about sort of relative to Q2 results? I mean, is it pretty much $35 million to $40 million incremental to the Q2 run rate or how should we think about that? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: That's exactly it. It's $35 million to $40 million over the next 12 months incremental to that Q2 run rate, after adjusting out the bad debt that we talked about, the $8.6 million (30:09) we described.

Yes. Okay. Okay. And after adjusting out the bad debt. Yeah. Right. So from the Q2 less the bad debt charge. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: That's right.

Okay. That's great. And then, just on the non-core Infusion business, any visibility into where you're at with that? I mean, I assume you have a decent degree of confidence given the fact that you put it into the press release, but any sense of sort of timing, what degree of certainty you have on the ability to transition that business? Richard M. Smith - President, Chief Executive Officer & Director: We have a high confidence and we have actions underway to essentially effect that change. And so, clearly, we have to work with other third parties, but we're moving with great deal of urgency in ensuring that we get that action taken care of.

Okay. And then just on that two, just to be clear, and then you said it was money losing, EBITDA negative on that business? Richard M. Smith - President, Chief Executive Officer & Director: Well, it's a net. So, some of the business is profitable, contributing, and we have others that on a fully burdened basis are not as profitable given our purchasing scale or lack thereof. So, essentially, the floor is on a net basis in terms of looking at the different therapy line.

Okay. But I guess what I'm getting at is the $4 million of cost savings, that's a net improvement. It's not offset by some EBITDA loss. It should be a net improvement to EBITDA? Richard M. Smith - President, Chief Executive Officer & Director: Correct; that's a net improvement.

Okay. Perfect. That's great. Thank you very much for taking all those questions. Richard M. Smith - President, Chief Executive Officer & Director: Thank you. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Thank you, Bill.

Thank you. And our next question comes from the line of Dana Hambly with Stephens, Inc. Please proceed.

Thanks. Good morning. Just on that slide nine, you outlined the six different buckets. Most of them seem pretty straightforward, but are there any in there that we should be thinking you have less confidence in being able to achieve or there's things that are beyond your control in any of those buckets? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: No. We don't think there's anything beyond our control. We've given the range of $50 million to $60 million. We were very confident, of course, in the targeted workforce reduction. And as you march across the slide to the right, each of those have degrees of difficulty, but we're confident in our aggressive cost reduction plan. And we're operating with a great deal of urgency around this. And we expect, over the next 12 months, that $35 million to $40 million of cost savings to be captured.

Okay, great. And then could you just remind us on the covenants. I think it was 7.25. Is that the max leverage? And I think you said that was extended through the first quarter of 2017 now, is that correct? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Yeah, you've got that roughly right. We had 7.25 leverage through Q1 of 2016 previously. We now have the 7.25 through Q2 of 2016, plus they've raised the leverage ratio to 6.5 for quarters Q3 of 2016 through Q1 of 2017. That 6.5 leverage is up from what was previously 4.5 dropping to 4.

Okay. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: So, the banks have shown a great deal of confidence in our financial improvement plan and the company's underlying core business.

Okay. All right. And then on the revolver, did you borrow $40 million or so since the end of the quarter? Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: Yeah. We've got $38 million outstanding under the revolver currently. We've done that on purpose to give ourselves some liquidity.

Okay. Jeffrey M. Kreger - Chief Financial Officer, Treasurer & Senior VP: In terms of cash and bank versus capacity on the revolver, we did that with the full blessing of the banks. And we talked to them about the reasoning for doing so upfront. Our payables are at term today, so we're not behind on our EP at all. It was just a strategy approach for liquidity for the organization.

Okay. Thanks for that. And then last for me, just on the selling of the $239 million of the chronic, does that hurt in any way kind of the referral sources you get, just any kind of disruption that would have on the existing business going forward? Richard M. Smith - President, Chief Executive Officer & Director: No. None of this is tied to the – some of this is essentially, as I said, were accumulated through the acquisitions that we've made as well as through other initiatives. And so, they're not tied to any core infusion referral source. Some of these have been in the organization or the predecessor organizations for a number of years. And so, with each of our payers that have a captive subsidiary we have, those are alliance partners of our. So, we believe that collaborating with them in the marketplace will not at all hurt our abilities from a referral source perspective.

Okay. Thanks very much. Richard M. Smith - President, Chief Executive Officer & Director: Okay. Thank you.

Thank you. I'll now turn the call back over to Rick. Please go ahead. Richard M. Smith - President, Chief Executive Officer & Director: Thank you so much. Thank you for joining us today. Just as I stated, we have already begun taking significant actions that will adjust the revenue portfolio and we will reduce cost. We're highly focused on the task on executing our plan and committed to shareholder value creation. We look forward to updating you on our continued progress. Thank you.