Good day, and welcome to the Transgenomic Second Quarter 2016 Financial and Business Review Conference Call. All sites are currently in a listen-only mode. Please note there will be a question-and-answer session later on in the call. [Operator Instructions] Also note, today’s conference will be recorded and will be accessible both by phone and on the Internet. For more information, please refer to the conference call press release on the Company’s Web site, transgenomic.com, for further details. The Company has asked that I read the following statement. Management will make comments today that contain forward-looking statements. Forward-looking statements are any statements that are made that are not historical facts. These forward-looking statements are based on current expectations of the management team, and there could be no assurance that such expectations will come to fruition. Because forward-looking statements involve risk and uncertainties, Transgenomic’s actual results could differ materially from management’s current expectations. Please refer to the press release, the Company’s most recent 10-Q, 10-K, and other periodic SEC filings for information about factors that could cause different outcomes. The information presented today is time sensitive and is accurate only at this date. If any portion of this call is rebroadcast, retransmitted or redistributed at a later date, Transgenomic will not be reviewing nor updating this material. I’ll now turn the call over to Transgenomic’s President & Chief Executive Officer, Paul Kinnon. Please go ahead, sir.

Good afternoon, everyone, and thank you for joining us for today’s second quarter earnings conference call. I’m joined by our Chief Accounting Officer, Leon Richards. I’ll provide an overview and an update of our progress, and Leon will then briefly review the quarter’s financial results in greater detail. Please note that we are now reporting our Cancer Liquid Biopsy business as a single continuing operation, along with some legacy reporting for our discontinued operations from our non-core businesses. As we have discussed previously, we are also suspended our testing out of our New Haven laboratory after strategic review of the Patient Testing business unit in the first quarter. TBIO is now fully focused on ICE COLD-PCR and cancer testing as its sole business on a go forward basis. In the first six months of 2016, we devoted consumable time to implementing these changes. We are now able to focus fully on the commercialization of our ICE COLD-PCR technology that enables broad use of Liquid Biopsies and adoption of precision medicine. Our team is reporting that they are starting to see excitement about the performance attributes of ICE COLD-PCR and the recent interest in adoption from clinical labs, molecular diagnostic labs, and academia of life science companies. This is allowing us to build a strong pipeline of potential commercial partners for licensing opportunities so we are continuing to activate this year in the second half of 2016. Our focus is conversion of these of these opportunities as the scientific pace has been a bit slower than we wish, for institutes and companies in general are tending to be cautious and therefore more deliberate in their deal making. In addition, potential partners’ licensees are following a more rigorous process and taking the time to set new technologies with care to ensure that…

Thank you, Paul. Net sales for the second quarter of 2016 from continuing operations was 25 million and increased by 0.1 million or 14%, as compared with the same period in 2015. Sales of our contract laboratory services in our Omaha Lab were flat year-over-year and the slight increase in net sales for the current year period reflects some higher oncology and some revenue generated from grants. Gross profit was a negative $37,000 during the second quarter of 2016, compared to a negative $23,000 during the same quarter of 2015. The negative gross margin during the second quarter of 2016 is due to revenues that were not sufficient to cover the current laboratory direct fixed costs. The lower sales in our contract laboratory revenue services, which is driving the lower gross profit is a function of fewer active projects in the current year, and the timing of standpoints supplied by customers to work on those projects. Selling, general and administrative expenses decreased by 0.5 million to 1.4 million during the three month period ended June 30, 2016, as compared to the same period in 2015. Decrease was due to a lower franchise tax fees and lower stock compensation costs in the second quarter of 2016, as compared to the second quarter of 2015. Research and development expenses for the three months ended June 30th remains relatively flat at about 0.4 million, as compared to about 0.5 million for the three months ended June 30, 2015. In summary, the net loss from continuing operations for the second quarter of 2016 was 2.2 million or $0.10 per share, compared with a loss of 3.2 million or $0.26 per share for the second quarter of 2015, a decrease of 30% or 1 million. Modified EBITDA which is a non-GAAP measure that Transgenomic views…

Thank you, Leon. To recap, Transgenomic has made significant progress to becoming the focused precision medicine Company we’ve been targeting for the past 12 months. We significantly advanced our ICE COLD-PCR commercialization strategy with the launch of multiple CLIA tests for cancer, refined licensing agreements and we’ve moved into the commercial diagnostics market and we continue to work with our pharma partners to develop a scalable ICE COLD-PCR-based service business. We accomplished this while delivering on our promise to divest on non-strategic assets thereby significantly reducing our expenses and generating some non-diluted cash. At this point operator, we’re ready to open the call to questions.

Our first question comes from Per Ostlund with Craig-Hallum Capital. Please go ahead.

A couple of questions for you and you’ve alluded to some of this in your prepared remarks, so I may have some idea of where you’re going ahead with the answers, but maybe we would get in there a little bit further. As it pertains to potential collaborations, we’ve talked about an anticipated some -- for a little while here. And you did allude to the rigorous process that some of the potential counterparties are going through. I am just curious maybe if you can get into what some of the gating factors might be that are remaining to kind of get one or two of those to come fully on-board if it's just validation on their end if there is anything that you can do or doing with them in conjunction to move that forward or sort of how the situation plays out between here and agreement?

Yes it's a process whether it's a valuation of ICE COLD-PCR or anything else, I mean I think most companies these days are finding that the overall process depending on deal signed, it's the largest, it's little bit slower and not just make through the business. Additionally there is various issues relating to the fact that this is being used and implemented in the labs that we are talking about for patient treatment. So there is a little bit more rigor there and there is a lot more attention being focused on the enabling nature of technology and how it can actually make their life easier. I think people are trying to make sure they don’t make a mistake and buy as a one technology or another technology or just look at their current workload at the customers and the patients because also they are treating cancer patients. Currently they don’t want to disrupt that. But they are moving away some to migrate away from tissue biopsies and they are going to go towards Liquid Biopsies. And obviously the insurers and CMS and everything else, hasn’t yet adopted the technology completely. So we are still at that early stage. So I think it's all of those factors together as I am thinking anything pertaining to our technology. We do have the compelling differentiator but nobody else that we are aware of is actually offering a technology beep and you just add to your reaction carry out in your lab and basically then you are enabling them to do precision medicine whereas the other vendors are saying send us a sample, we will treat them and give it you. We won't tell you what we are doing, and then we will send you the results and you can get back to the patient. So it's a big differentiator. And I think the people we are talking are basically making sure that that differentiator is real and make you believe it is, and once they believe that it will move through. But again the organizations are sort of following a lot of a rigorous process. So that’s sort of gives you a bit more color or if you want to know sort of specifics of where we see the process in different accounts or one?

No, actually that was great color, I mean if you wanted to go into to one or another as an example I would certainly take that. But no I think that was very, very helpful. Thank you.

I mean, I can give you a little bit both, but I was mentioning names and stuff that I had talked to another shareholder a few weeks ago and he asked me some specifics. But we have had issues with clients where they have had turnover in their organization or organizations have had change as whether it measures by acquisitions or other activities. And those activities have slowed down our progress and that’s the challenge that you can't deal with. Because the marketplace in lifescience these days is so aggressive in terms of M&A activity and discussion, those activities are going about in all organizations now and there is a lot more of that going on. And because of that, that’s also affecting us, so some turnover in some other companies we have been talking to some Senior VPs and VPs in organizations and then within two weeks that person is gone, and he has to start building the relationship up again. And in some cases it's been junior who are doing certain valuations and testing and they didn’t follow-up on what they were supposed to do, then their organization dismissed them and you have to start from scratch again so we have had some hurdles there and out of our control a little bit and that’s been a hiccup it is sometimes you can't deal with that that’s why we have built a bigger pipeline and a bigger opportunity base and we believe it is in access of three times as large as it was at the beginning of the year. So we have got a lot of things in the pipeline, now we have really got to as you say close them and close these deals as soon as possible.

Okay, that’s excellent. Thank you for the additional color there. Maybe turning really quickly to the agreement you announced earlier this week with VWR, I thought that was an encouraging announcement on the ICEme Kit, wondering if maybe you could go into just a little bit of background there and maybe how the relationship was cultivated did they seek you up did you seek them out and maybe give us a little bit of flavor for kind of the reach that they bring to the table for those that maybe aren't as familiar with, with that organization?

Sure, so I've known VWR for many-many-many years obviously in my lifetime, at Life Tech they were a serious competitor. They were the second largest in U.S. and maybe the second largest in the world depending on what market you are in. So, from a reach point of view, they have got a large number of sales people in the U.S. they've got a lot of technical support people, they have contracts with nearly every major academic and major pharma-biotech in the U.S. They supply products for everybody and they're very aggressive on getting new technologies into the marketplace and that's one of their expertise and one of the things they really excel at is bringing new products to market and getting it to customers. So, perfect match for us for the ICEme Kit. So, we've discussed it with them, they're excited, the negotiations again were a little bit longer than we would have liked, we actually started talking to them earlier in the year and it was a phasing thing but once they understood the potential and saw the value of what the kits could bring to the academic and the pharma market they're excited, for instance they see the benefit, and the pharma see the benefit of using the kits in-house and testing samples while those samples are being used that firmly and tested for clinical trials as well. No other technology allows that, no other company is providing a liquid biopsy solution where a pharma such as GlaxoSmithKline can buy a reagent run it in-house at the same time that the clinical study is being carried out with that product. And if you go to foundation or to anybody else, they're sending their liquid biopsy samples out and they're getting results back that day. This way they can check, they can match, they can do things early on and advance there and really benefit from understanding what's going on with the samples. So, that's compelling and it's a good partnership from that. From a point of view of the revenue and the size and the materiality of the opportunity we obviously have set some targets with them and we've got a discussion ongoing with them. We think the first two months will be quiet but do we do things by the end of the year that we'll start seeing material growth and we'll be looking to report that. And then maybe sometime next year, if they allow it, we'll be able to give the better forecast as the run rate picks up. But we do see being in material relationship and we're hopeful that the VWR relationship will grow as well.

All right, duly noted, Leon you are on the hook. Last question for me, again you kind of alluded to this in your comments Paul but now you really are presenting yourself as a fully focused around the ICE COLD-PCR technology in precision medicine and have worked to move out the non-core assets, is there really anything left on that side of things to divest or otherwise monetize or are you basically all set on that front?

Well there're some commercialization opportunities that are presenting themselves. We still retain a certain amount of IP relating to that business and in fact the license with LabCorp, we've a very good relationship with LabCorp, there was a quote in our press release from last year and basically we've talked about this business to some people and that long Q2 portfolio we actually licensed for LabCorp so we'll be getting royalties from them on a quarterly basis and we're actually in discussions with all other organizations without doing as something similar because if companies are producing that test and it's going to buy our IP then they need to pay us royalties. So, those are some opportunities there, they're nowhere near as big as ICE COLD, it's not a focus for us, a recent opportunity where we can generate cash in the short-term and it will bolster the business as we move forward and become successful with ICE COLD-PCR.

Thank you. We'll go next to Mark Tabachnick with Mark Communications Network. Please go ahead. Mark your line is open. Do you have us on mute? I’m sorry Mark unable to hear you. If you can hear us, you have us on mute? Again, it looks like we lost Mark. [Operator Instructions] It appears, we have no further questions at this time. Ladies and gentlemen, this will conclude our question-and-answer portion of the call. I’d like to turn it back over to management now for additional closing remarks.

Thank you very much. Despite our challenges we are encouraged by the positive feedback we’re getting and the progress we are making in the marketplace, in advancing commercialization of ICE COLD-PCR, with a potential to transform both our company and the emerging field of liquid biopsies in precision medicine. We appreciate your support and look forward to keeping you apprised of our progress as we continue.

Thank you very much. This does conclude today’s call. We appreciate your participation and you may now disconnect. Have a great day.