Ladies and gentlemen, thank you for standing by, and welcome to the Myriad Genetics Fourth Quarter Financial Results Conference Call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. (Operator Instructions). As a reminder, this conference is being recorded Tuesday, August 19th, 2008. It is now my pleasure to introduce Mr. Peter Meldrum, President and Chief Executive Officer. Please go ahead, sir.

Thank you. Good morning and welcome to the Myriad Genetics earnings call for our fourth fiscal quarter and year ended June 30th, 2008. My name is Peter Meldrum, and I’m the President and Chief Executive Officer. I am joined today by Jim Evans, our Chief Financial Officer; Gregory Critchfield, President of Myriad Genetic Laboratories; and Adrian Hobden, President of Myriad Pharmaceuticals. I will begin the discussion this morning with a brief review of the past year and will be followed by Mr. Evans who will discuss our financial results. Dr. Critchfield will review the company’s molecular diagnostic business and Dr. Hobden will discuss our drug development activities. At the end of the presentation, I will turn the call back over to the operator for the question-and-answer period. Please note that some of the information presented here 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. The company was extremely disappointed with the results of the Phase III Flurizan study, and as previously announced, has discontinued all development of Flurizan. Because of the additional development risks associated with all CNS disorders, the company has lost its appetite for further drug development in the CNS area, and will now focus its…

Thank you, Pete. As Pete has discussed Myriad's fiscal 2008 and specifically the quarter ended June 30, 2008 have been very significant for the company. This is also true as we take more detail both Myriad's financial results for those periods. Myriad's total revenues for the quarter ended June 30, 2008 were $166.9 million as compared to $45.5 million for the same period of the prior year. Total revenues for the fiscal year were $333.6 million as compared to $157.1 million for fiscal 2007. The first component of total revenue that jumps out is a new line on our income statement pharmaceutical revenue. As you will recall, on May 22 of this year Myriad announced that it had entered into collaboration with Lundbeck where in Myriad received an upfront non-refundable payment of $100 million. At that time it was determined that the $100 million will be taken into revenue straight line over the 15-year contract term. The intended accounting treatment changed with the June announcement of the unsuccessful Flurizan U.S. Phase 3 trail and the company’s decision to discontinue the development of Flurizan. While we are engaged in various activities to wind up the discontinued development of Flurizan some of which have carried over into physical 2009 we have determined in consultation with our auditors that as of June 30, 2008 under the terms of the agreement, we had no further substantive obligations to Lundbeck, this resulted in our booking the entire $100 million into revenue in the quarter ended June 30, 2008. I will also point out that on June 30, 2008 Lundbeck announced that it was writing off it's $100 million investment in Flurizan European rights. The (inaudible) therapeutic revenue we continue to see impressive growth of Myriad’s molecular diagnostic sales. Molecular diagnostic revenues for the quarter were…

Thank you, Jim. It’s the great pleasure to speak with you today about our molecular diagnostics business. As Jim mentioned, year end fiscal ‘08 revenues for our molecular diagnostics business were $222.9 million, a new record, representing 53% increase over our previous year’s annual revenue of $145.3 million. Even without the BRACAnalysis public awareness campaign, which ended in March, the last quarter achieved double-digit growth over quarter three fiscal ‘08 with $64.7 million in revenue. Our operating margin for the year was a record 43%. We are focused on the growth strategy that has four components; increased penetration in the oncology market, expansion into the women’s health segment, broadened indications for our existing products, and the development of personalized medicine portfolio. We continue to make excellent progress in all four of these areas, and I’d like to provide details on our progress. As Pete mentioned, the market potential for our hereditary cancer products is very large. We estimate the market potential for BRACAnalysis alone to be approximately $700 million per year. We believe that COLARIS, COLARIS AP, MELARIS and THERAGUIDE 5-FU have a large combined market potential that is high like that of BRACAnalysis. We estimate the combined total annual market potential for our tests with current indications for testing to be over $1.3 billion. We anticipate significant growth given these large potentials for each of our product recognizing this potential is the focus of our two – two of our strategic initiatives to increase penetration in the oncology market and to expand our presence in the women’s health segment. In the oncology market increased utilization has been driven by three factors; enhanced professional society guidelines, decreased turnaround times leading to physicians incorporating tests for real-time decision making, and sales and marketing efforts focused on expanding the physician customer base.…

Thank you, Greg and good morning. It’s, of course, a huge surprise and disappointment where Flurizan did not show clinical efficacy. However, as promised, we presented the data to the audience at the international conference on Alzheimer's disease, and we will provide the data to the Alzheimer's disease co-operative study group so that it can assist others in designing their clinical trials. Myriad will not be pursuing further studies in Alzheimer's disease and in fact, have decided to see all research and development in the CNS arena. In stead, we will be concentrating on our core expertise of cancer and infectious diseases particularly on Azixa, Vivecon, and MPC3100. We continue to make good progress with our clinical programs with Azixa in melanoma and glioblastoma. As you may recall, Azixa is a very potent inhibitor of tumor and rapidly induces [epitosis] in the dividing cells. In our Phase 1 studies, there were several observations of anti-tumor activity against the number of cancers including melanoma, ovarian and testicular. We also noticed that it disrupts the blood vessels, leading oxygen to the tumors. An observation that we were subsequently able to confirm with detail studies in (inaudible). By itself, these observations would make Azixa, a very exciting compound. However, the molecule has two other properties that make it truly unique. Firstly, it is not a substrate for any of the multi-drug resistance pumps that are up regulated in tumors as a result of repeated treatment with the current generation of chemotherapy agents. We would expect therefore that tumors that become resistant to [taxo] which is another (inaudible) agent would remain fully sensitive to Azixa. We have been able to confirm this in [xenograph] studies. Secondly, and perhaps of most significance, Azixa has the remarkable ability to cross the blood-brain barrier and accumulate in…

Thank you, Adrian. I will turn the call over to your operator for the question-and-answer portion.

Thank you. (Operator Instructions). Our first question is coming from the line Jeff Meacham from JP Morgan. Please proceed.

Hi, guys. Can you hear me?

Yes.

Yes.

Okay. Thanks for taking the questions. Congrats on a quarter. I wanted to – if you can comment to the extent that you can about your operating expenses related to the overall therapeutics business. I know in the past you guys have broken out the percent of R&D that was attributed to Flurizan. I am wondering if you break out the, in a general way, the expenses attributed to just drug development on the R&D and on the SG&A side. Just trying to get a better sense for what a spin-off could look like?

Thank you, Jeff. I’ll have Jim elaborate on this. First of all, our total R&D spend is about $120 million. About $20 million of that is associated with our diagnostics group, about a $100 million associated with pharmaceutical development. And of course, we indicated that we would discontinue all development of Flurizan which was about $60 million of that $100 million spend. I would also direct you to the 10-Qs and our 10-Ks, which breaks out using segment analysis, the R&D and some of the other expenses among the various operating divisions within Myriad.

Yes, Jeff. As far as – you know that I think Pete helped out with the R&D pretty specifically. On the SG&A, it’s relatively small what is directly associated with the pharmaceutical business. Since I have pointed out in my comments earlier, we did have about $5 million of costs that went through the SG&A associated with preparations for Flurizan launch. And those obviously will be reduced during forward until the time that we are preparing our next drug for launch. And so, that should be reduced fairly significantly in the coming months.

And just a follow-up question on the predictive medicine business, you guys have done – run DTC campaigns in the northeast, you are in the southeast now. What other markets in the US do you consider yourself to be under-penetrated? How do you think about, maybe the West Coast opportunity versus where you are today and maybe Midwest? Thank you.

Thank you, Jeff. I think if you look at the main population centers, that reflects fairly accurately our revenue density throughout the country. So, if we decide to continue the DTC campaign beyond the south region, we would look at the West Coast, the Chicago area, other areas of the country that are the population density centers.

Our next question coming from the line of William Ho from Banc of America Securities. Please proceed, sir.

Hey guys. Congrats on the great quarter. Can you just elaborate a little bit on Jeff’s question with respect to SG&A? How much do you generally spend on advertising expenses and campaigns in order to push the sales in predictive medicines?

Hi, Will. As Jim mentioned earlier, we spend about $8 million on the direct-to-consumer marketing campaign in northeast, and that represents about 12% of our total revenue base. The south region is actually larger. It represents about 18% of our total revenue base. Yet we will hold the spend to roughly that same $8 million. So, for the regions that we would look at as we go from region to region, I think you can rely on that $8 million as a reliable figure for the cost of the direct-to-consumer campaign.

Alright. I guess more specifically, in this year of the approximately $120 million or so in SG&A expenses, how much of that is compensation for sales and marketing staff for campaigns, etcetera, versus how much is generally rents, etcetera, a finance group, etcetera?

We have never broken out that type of detail what the SG&A cost is for each of those individual components. We talk about the major initiatives and what it’s costing to the DTC campaigns or those kinds of one-off type of things. But I don’t have for you the detail on each of those individual line items within SG&A.

Okay. And then just one final question I guess for Greg. Do you get a lot of questions from investors about concerns about the top line, and whether or not you will hit any kind of a glass-filling leading to revenue slowing down. That being said over the last four years or so, you’ve had very, very robust growth from the top. Do you see anything that could potentially slow that revenue growth, or do you see yourself accelerating revenue growth or constraining revenue growth from here?

Well, this has been a concern that’s been expressed also over the last four years well, and we’ve had excellent growth. I think it’s very important to pay attention to the large market potentials of all of our products, and that includes BRACAnalysis as well as our other four products. We see this revenue potential is something that will allow us to continue to grow and to grow at significant rate. I think that that’s what we anticipate saying and we are excited about that. This would be accelerated even further if we’re able to broaden indications for our current products, and that’s why that is one of the prongs of our four-pronged strategy. So, we will increase penetration in both our oncology and woman’s health markets. We are working on that. We have talked about those initiatives. And then broadening the indications will further increase the potential and allow us to continue excellent growth.

I think the last time we had an update, Jamie still been the CFO, though at that time some of the other markets or other products were growing at significantly higher growth rates, potentially even in the triple digits. Are they still growing at that rate or at a similar rate?

Will, in this earnings conference call, I mentioned that for the last year BRACAnalysis COLARIS and MELARIS, all threw, grew in excess of about 50%.

Okay, great.

Our next question coming from the line of Annabel Samimy from UBS. Please go ahead.

Hi. Thanks for taking my call. Just on the line and broadening out the predictive medicine platform, the molecular diagnostics platform. When you think about new products and expansion in new technologies, is there still more room in personalized medicine and does this bring a whole new level of competition for you and how do you address that? Or are there areas that you are looking at in terms of personalized medicine areas that you have IP around.

Thank you, Annabel. As you are aware, Myriad is focused and the general feel that molecular diagnostic, but in particular, on predictive medicine and personalized medicine, and more recently our last product was a personalized medicine product. In all of these areas Myriad seeks a strong IP protection as we can obtain, and we are fortunate at the end of the test that we look at are all based on disease causing genes or genes that metabolize specific drugs as oppose to association studies where the IP situation is more tenuous. So, we do have very strong IP in the products that are in our pipeline under development, and we feel very comfortable with the intellectual property around those. Having said that, however, I would like to point out that Myriad had strong competitive advantage in other areas in terms of it's customer service, it's insurance reimbursement programs, the excellent turnaround time, and quality of the test results and a very strong and talented sale force. So, I think our competitive advantage goes well beyond just the IP projection.

Okay, one other question if I maybe, I guess Jim you had mention that with the $5 million that was associated with Flurizan launch cost that SG&A will be kind all those fluctuate what -- could you give us a sense of what is the right number to sort of look at a run-rate going forward I mean is that just $36 million with $5 million or is it sort of something different?

Projecting of the future is difficult. Like I said, the bulk of that 5 million will go away. We have those other issues that I described as far as the commissions that came through in the quarter and so that, that will be backed off a little bit. So, without giving guidance as we don’t do I’ll reiterate those couple of items that are kind of out of the ordinary one-time things that would run into, obviously we plan on having the expense associated with DTC campaign go through the next couple of quarters. So, you can project that to be fairly consistent for the next couple of quarters, but just taking into consideration those other items that are kind of one-time out of the ordinary and hopefully that will get you to SG&A number for your models going forward.

Okay, thank you.

Our next question coming from the line of Michael Yee from RBC Capital Markets. Please go ahead.

Congratulation on great quarter. Couple of questions, regarding the DTC that was previously in the Northeast, can you kind of characterize better for us how well that message was sticking with doctors, patients and what was the growth in this region specifically relative to last quarter and then how would characterize demand in this regions from (inaudible) this quarter and last quarter?

Real question, however, is the sustainability of that after the adds of stock running, and so that’s something we will be looking at very closely over the next several months and we’ll actually do a formal ROI calculation in December of this year. But we have seen excellent growth from the campaign, the campaign looks like it's been very effective at getting the message out and increasing our physician customers. As Greg mentioned our reps that cover the OB-GYNs achieved profitability just as fast as the oncology section. We are, of course, much more penetrated, into the oncology market having addressed that market now for a number of years, but we see the growth potential in the OB-GYN market as being substantial and we look at those reps coming up to speed just every bit as fast in the oncology market.

On the margins on the diagnostics business about 44% or so this quarter, things are good on the gross margin, now where do you think both the gross margin and the EBIT margins can go to over a year or longer term and do you think that’s getting over 50%?

Well, we do consider that we have room to grow on both of those numbers, gross margins would seem 600 basis points increase over the last year. I think, I would like to say with a kind of pick the low hanging fruit there, but there is still are areas where we can improve our processes and increasing our -- reducing our turnaround time and improving the cost per sample. So, I would anticipate we would continue to see improvements in the gross margin over the next couple of years. Last quarter we had 47% net operating margins, which, I think gives us an idea of the strength of the net operating margins in a non-DTC period and so we will continue to monitor how well the DTC campaign performs as we determine if we are going to roll that board into other areas in the future, that obviously will have an impact on the operating margins. Now if we were able maintain the DTC campaign spend in the $8 million range or less as we have been able to do with the last two campaigns, obviously that number becomes less of an impact as the top line number continues to grow. So we would expect to see margins, the net operating margins improve as well as we go forward.

Right. I am just thinking on the R&D and SG&A line there, probably a lot more leverage so that’s why the sensitivity being the DTC spend that would be reasonable.

Yes.

Okay. Thanks.

Our next question coming from the line of Kim Lee from Pacific Growth Equities. Please proceed.

Good morning. I have a couple of questions for you. The first, the line financial question, do you expect additional costs associated with the termination of the Flurizan program going forward in the next couple of quarters, or have we seen the last of those expenses?

No, as we were able to look forward and since the viability of the contract and the discontinuation of the Flurizan program, we were allowed to go through and say if we had any solid invoices that are associated with the wrap-up of that program even those some of those expenses might happen in the 2009 period, we were able to accrue those back into 2008, but that was only for expenses that we had invoice in hand for, and so that’s the $3 million that I mentioned earlier that we were able to accrue for the termination cost. We still anticipate that there will be additional cost as invoices come in the next couple of quarters somewhere probably in $4 million to $5 million range that we’d expect to see going forward as we wrap-up the final [license] of the project.

Okay, and I assume you expect those cost earlier in ’09 versus working in fiscal year '09 versus broad out.

Yeah, I would expect it will be working diligently to try to get all those new sense wrapped-up and get those costs booked, as soon as we can.

Great, and also, just curious what are your days payable outstanding right now?

Yeah, probably in the 60s I think it’s about 66 days actually. So, we take our time in getting those turned around.

And that was for last quarter and that does represent a substantial improvement over the prior quarter. So, we do feel that our receivables are of a very high quality and a 66 day sales outstanding, I think, is excellent in industry.

Oh, I am sorry, you are asking about payables or receivables?

Payables. Yeah, payable changed a lot more days than the normal.

Payables, we normally are in the 45 to 60 day period. But obviously we try to stretch those out for as long as we can each month and take advantage of the interest rate we get on conserving our own cash. So, yeah, those fluctuate from vendor to vendor but I would say in the 45 to 60 day period.

Okay, great, and one last question on, remember you mentioned going to product launches for this year you funded launched a product this year in the Oncology space, can you elaborate on one other products that are in your molecular diagnostics pipeline.

I think you’re addressing that question to Adrian, but really it's a molecular diagnostic question. So, let me hand it over to Greg, can you feel free to jump in if you would like as well. Yes the next product we will launch is in the Oncology area. Of course Myriad is very strong in Oncology and we see tremendous upside potential in that. Myriad on the predicated medicine front has discovered genes associated with a pre-disposition of prostate cancer. We have discovered genes associated with genetic pre-disposition and the area of major depression, type II diabetes, are working on personalized medicine products in area of lung cancer, pancreatic cancer, ovarian cancer, breast cancer, and colon cancer. So, we have a very strong molecular diagnostics product pipeline in both the areas of predicted and personalized medicine and we are very excited about our ability to launch products in the future in both those stilts.

In addition, our internal research group is looking at these discoveries and the way that the cancer pathways are signaled, and looking at ways to leverage the information that they provide, and providing information about response to drugs and our prognosis. So, these are all the areas that we are looking. And as Pete mentioned, there are a lot of very interesting opportunities that we anticipate will come forward.

Great. Thanks a lot for the clarity.

Our next question coming from the line of Charles Duncan for JMP Securities. Please go ahead, sir.

Good afternoon, guys. First of all, let me add my congratulations on a good quarter and strong execution. I had two quick questions. One is for Greg. Can you give us some insights on the timing, potential timings of some of that data that you outlined? That’s pretty intriguing news for BRACAnalysis, for example.

Yes, these are trials that take years to finally get the endpoints. As you may know Astra-Zeneca trial, we announced probably about two years ago, and that was a very preliminary trial. There were need to be more work done to have this come to fruition. But it takes usually a couple of years before the endpoints are known to see where it is, and we don’t really have a completion timeline at this point in time. All we know is that the trials are underway, and we anticipate hearing more in the future and we are looking forward to it. There are some external groups that are working on trials now that are anticipated to last three to four years’ total. Some of these groups began these trails into 2005-2006 timeframe. So, they are getting closer to where they would have results. But with recruitment issues, some of them have been a little slower. Myriad’s involvement is actually going to accelerate things and make it easier for data to come out. When we have some more specific timelines, we’ll announce them. But right now, I can’t give a precise timeline on any of these.

Thanks, Greg. And then my last quick question is perhaps for Pete. Can you outline perhaps the form in terms of the disposition of cash NOLs? Do you have some additional color on that, if the company decides to split itself into two?

Thank you, Charles. Well, I don’t want to get ahead of ourselves, because the company has made no decision to change its current strategy or operating structure. As we mentioned in this call, periodically the Board does take a look at the strategy as is appropriate and make sure that we are still moving the company forward and operating the company in the best interest of shareholders. And we certainly are in that process right now. As I mentioned, in the fall we will present our findings to the Board of Directors, and of course, it is a Board decision as to whether or not we do anything differently or maintain our current operating structure. So unfortunately, Charles, it’s a good question, but I think it’s premature until we’re further down the process to even think about what alternative structure the company may consider as appropriate, and how the company may move down to then implement that strategic decision.

And then Pete, not to be 2Q, but definition of fall is, include September as well as November?

Yes. As I mentioned, our hope is and again this is a Board decision, so it’s not completely within my control, but our hope is to have a final deliberation and assessment completed by the end of the calendar year. We do have two Board meetings in the fall, one in September and one in November around our annual shareholders meeting, and the Board will be deliberating certainly and discussing this in September. I will be very surprised if any decision is made as quickly as the September Board meeting. The Board will then reconvene. We have a two-day meeting in November. And again, if there are additional questions that the Board has or additional analysis they would like to have performed, we certainly can call telephone Board meetings as well. But I think –

Okay.

We should be in recently good shape to present to the Board in those fall meetings.

Good deal. Thanks for added color. Congrats.

Thank you, Charles.

Mr. Meldrum, I’ll turn the call back to you, sir, for closing remarks.

Well, thank you very much. We appreciate everybody’s attendance on the earnings call this morning and appreciate the continued support in Myriad. This does now end the earnings call for our fiscal year-end 2008. Thank you, again.