Good morning, ladies and gentlemen, and welcome to the Thermo Fisher Scientific 2015 First Quarter Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. I would like to introduce our moderator for the call, Mr. Kenneth Apicerno, Vice President, Investor Relations. Mr. Apicerno, you may begin the call.

Good morning and thank you for joining us. On the call with me today is Marc Casper, our President and Chief Executive Officer and Pete Wilver, Senior Vice President and Chief Financial Officer. Please note this call is being webcast live and will be archived on the Investor section of our website, thermofisher.com under the heading Webcast and Presentations until May 15, 2015. A copy of the press release of our 2015 first quarter earnings and future expectations is available on the Investor section of our website under the heading Financial Results. So before we begin, let me briefly cover our Safe Harbor statement. Various remarks that we may make about the company's future expectations, plans and prospects constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the company's Annual Report on Form 10-K for the year ended December 31, 2014 under the caption Risk Factors, which is on file with the Securities and Exchange Commission and also available in the Investor section of our website under the heading SEC Filings. While we may elect to update forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our estimates change, therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today. Also during the call, we'll be referring to certain financial measures not prepared in accordance with generally accepted accounting principles or GAAP. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures is available in the press release of our first quarter 2015 earnings and…

Thanks, Pete. Melissa, we're ready to open it up for Q&A.

Your first question is from the line of Jon Groberg from UBS. Your line is open.

Hey. Good morning and congratulations on another solid quarter. So, Marc, would you mind just, I guess, obviously, one of the big questions is going to be on the low-single-digit 2% organic revenue growth. Can you maybe talk a little bit more about your conviction that that growth rate improves a little throughout the year? You mentioned you thought academic and government would get a little bit better. And can you also maybe talk about some of your more specific plans to offset FX? I know you mentioned some on the cost side, but is there anything you're doing in terms of pricing? And how are you finding the pricing environment? Thanks. Marc N. Casper - President, Chief Executive Officer & Director: Jon, thanks for the questions. So, yeah, let's start kind of with the holistic view, right, for organic growth. The key takeaways we feel very comfortable with the 4% organic growth guidance for the full year that we set off back in the beginning of February and we feel good about that today. When you think about the quarter, if you recall back to early February, we said that this would be in the range of 2% to 4% organic growth and primarily so lower in the first quarter and builds as the year goes on, primarily because of the calendar day difference, right, so we anticipated that. When we look at the performance of the quarter, really the only big change was Japan didn't approve its budget during the quarter that got approved, I think, on April 9. So that's back in place. Europe was a little weaker, but China was a little bit stronger. So there were puts and takes. But I felt like the quarter played out within the range of what we expected. Looking…

Great. Thanks a million. Marc N. Casper - President, Chief Executive Officer & Director: You're welcome.

Your next question is from the line of Ross Muken from Evercore ISI. Your line is open. Marc N. Casper - President, Chief Executive Officer & Director: Good morning.

Hey, guys. Peter M. Wilver - Chief Financial Officer & Senior Vice President: Good morning.

So I'd like to stick on Jon's theme on the core. So you mentioned that booking's pacing towards the end of the quarter kind of gave you some confidence that the ability to hit the 4% target was still on track. And so as you look at that, I don't know what's the right way to cut it, Marc, by geography or by end market? Where did you see the biggest inflection over the course of the quarter? Because as we look at some of the PMIs and we look at some of the other industry commentary, it's a little bit different than sort of what you saw in the business and so we're just trying to mix-and-match. And by that I mean Europe seems a little bit better and maybe China, the service seems a little bit worse. And so we're trying to make sense of what you saw bookings versus what the market overall macro is seeing. Marc N. Casper - President, Chief Executive Officer & Director: So, Ross, Europe improved clearly as the quarter went on. Very, very slow start at the beginning of the year and improved. So that was a positive. China, as I mentioned, I was in China in March. Generally, the team from the beginning of the quarter right to where it finished felt that they were going to deliver high-single-digit growth and they did, right. So we didn't see much of, I'd say, change in activity level, meaning, it was a better quarter, but the team saw it and it was consistent throughout. And so China was a little bit better, it's a little early to call a trend there, but we didn't see China deteriorate at the end of the quarter or anything like that based on the data you're referring to. So those are the two factors. Europe got better and China was good.

Got it. And maybe big picture. You talked about sort of M&A. So I was listening to my company's conference call before I jumped on this one and Roger Altman talked about sort of the trend in the market right now as maybe deal volumes are lower, but dollar volumes are higher. So we're seeing a lot more larger transactions. As you think about this space, it's actually been the opposite. I mean, other than Sigma, we really haven't seen much activity. I mean, in general, are you kind of surprised about what you're seeing in the pipeline? You're able to get there on the ASI, which looks like a really good deal. But as you think about where your leverage is going, you obviously have some firepower there. How are you thinking about the trade-off of what may be available versus where valuations are versus sort of what other opportunities you have? Marc N. Casper - President, Chief Executive Officer & Director: So great question. In terms of the capital deployment side of the equation, we have an active pipeline of transactions. We always do and we do currently. So we're looking at things. And as you know, we like to look at everything. But at the same point, we are very selective in what we actually do. And as long as something solidly meets our criteria of strengthening the company strategically, clearly, being understood and adding value for our customers and creating shareholder value, then we'll pursue those things. So I like what the funnel looks like, but you got to drive things through the funnel. ASI was a nice acquisition. We did two tiny little things in the channel to strengthen our commercial capabilities, and we're looking at a number of other things. So in terms of your bigger question about sort of the space, the bigger transactions, they happen, but they don't happen very frequently. And when they do, we usually will take a look, but they don't occur with a lot of frequency.

Great. Thanks, Marc.

Your next question is from the line of Derik De Bruin from Bank of America. Your line is open.

Hi. Good morning. Marc N. Casper - President, Chief Executive Officer & Director: Good morning. Peter M. Wilver - Chief Financial Officer & Senior Vice President: Morning, Derik.

So just to clarify your China comment, you said you're seeing some improvement. Is that still mostly lower-end lower-priced products, i.e., chromatography as opposed to pushing the higher-end mass spec? Just a little bit more color just sort of given some of the anti-corruption activities and stuff that were going on in the past? Marc N. Casper - President, Chief Executive Officer & Director: Yeah. So, Derik, if you look at China and you saw a clear increase in, what I'd say, your run rate activity, your bioscience reagents, your lab equipment, your lab consumables, those types of businesses, were very improved, meaning, that customers have money, they're spending it, activity is good. The bigger ticket items clearly continue to be muted. And that affected clearly our Analytical Instruments business. Chrome was quite strong, but things like mass spec were clearly affected by a tighter budget and more scrutiny, if you will, by the government.

Great. That's very helpful. And just one follow-up. On Specialty Diagnostics, we were expecting a little bit higher number there. We're expecting a little bit more tailwind from flu and some other things. Could you talk about what you sort of saw in the diagnostics space globally? And just sort of the push and pulls in that business? Marc N. Casper - President, Chief Executive Officer & Director: Yeah. I think when you look at the result in diagnostics, the one day difference probably is your biggest factor from...

Got it. Marc N. Casper - President, Chief Executive Officer & Director: ...what you would think from the other things. So I actually look at the underlying fundamentals or how the business performed, it's actually pretty solid; so not much there. We got a tiny benefit from seasonal, pollen season in Japan was slightly worse, so the net of seasonal was just slightly better in aggregate.

Great. Thanks very much. I'll get back in the queue. Marc N. Casper - President, Chief Executive Officer & Director: Sure.

Your next question is from the line of Tycho Peterson from JPMorgan. Your line is open.

Hey, thanks. Just want to follow up on some of the questions around guidance. And just so we're clear on what you're embedding now for Japan, now that we're through the March fiscal year, are you assuming a recovery here in the second quarter? And maybe just, you could quantify your overall expectations for the year in Japan? Marc N. Casper - President, Chief Executive Officer & Director: So what we're expecting in Japan is that you'll see growth return back to a more normalized level. And typically, we assume kind of low-single-digit growth in Japan is kind of the baseline assumption. We've actually had performance better than that in the past, but that's the baseline assumption. So, just given the timing of where the budget was, we would expect growth to start to normalize back to the traditional growth rates.

And then, following up on a question on China a minute ago, I think you're still cautious about calling any sort of inflection, but obviously high-single-digit growth this quarter. Can you maybe just give us a sense of what could get you closer to high-single-digit growth versus mid-single-digit growth guidance for the year in China? Are there specific catalysts we should be paying attention to, or is it just... Marc N. Casper - President, Chief Executive Officer & Director: Yeah. I mean, the team is clearly working towards that objective, right. So all of our colleagues, 4,000 colleagues, that's what they're driving towards. But they don't control sort of the government environment, right. So there's – the reason we just didn't put a hard-line type commitment to it is that, it is variable what the environment is. But clearly after a few very challenging quarters, we saw some nice bright spots. And if we can line up two or three quarters like that in a row, then that clearly would be a trend. So that's what the team is focused on. It's just executing well.

And then just lastly on BioProduction, you called it out as an area of strength. You obviously did the ASI bolt-on. Maybe just talk a little bit about what you're expecting for that business this year, and your visibility around that business? Marc N. Casper - President, Chief Executive Officer & Director: Yeah. So BioProduction, market-leading position in media and sera through our Gibco range of products, in a very strong position, and single-use technologies through the Thermo Scientific and ASI set of products. That will be a very fast-growing business for us. It is a double-digit type growth business for Thermo Fisher. INTERPHEX is going on right now. I know the early feedback is very positive on our range of capabilities, in terms of what we show to our customer base there.

Okay. Thank you. Marc N. Casper - President, Chief Executive Officer & Director: You're welcome, Tycho.

Your next question is from the line of Steve Beuchaw from Morgan Stanley. Your line is open. Steve C. Beuchaw - Morgan Stanley & Co. LLC: Hi. Good morning, everyone. Marc N. Casper - President, Chief Executive Officer & Director: Good morning, Steve. Peter M. Wilver - Chief Financial Officer & Senior Vice President: Good morning. Steve C. Beuchaw - Morgan Stanley & Co. LLC: First off, Pete, I just want to say thanks for all your help over the last year. Thank you so much. And we'll miss you on the calls. Peter M. Wilver - Chief Financial Officer & Senior Vice President: Thank you. Steve C. Beuchaw - Morgan Stanley & Co. LLC: And then for Marc, I guess I'll ask a question on China. Sorry for asking the fourth or fifth of these. But taking a longer-term view, Marc, you made some interesting comments about the longer-term outlook in China, specifically how you are thinking about the impact of the new five-year plan and your positioning for relative share there, given your positioning there as a local manufacturer. Be really interesting just to hear you expound upon those comments, to think about maybe the 24-month view for the market there? Marc N. Casper - President, Chief Executive Officer & Director: So, Steve, a couple of things. One is, we've been in China for 30-plus years. And one of the things that helps the company get successful is anticipating the changes in the environment to continue to be out in front of them so that you can benefit from the evolution of the economy. Our assumption is, and this is not a bold statement, is that GDP growth will be more moderate in China than what it had been in the previous five years. And because of that,…

Your next question is from the line of Dan Arias from Citigroup. Your line is open.

Hey. Good morning, guys. Thank you. Just wanted to see if I could understand the comments on academic and government. Marc, does the softness that you saw there pertain mostly to Japan, or is that something that showed up in the U.S. and Europe, too? Just a little bit clarification there if you could. Marc N. Casper - President, Chief Executive Officer & Director: So Japan was the primary driver, right. So we had been growing in the low-single-digits last year. We declined in the low-single-digits. The full delta between sort of flat and the decline was driven by Japan, maybe the difference between flat and the rest was just a little bit of softness that we saw in Europe. So that would be the academic and government story, really is a Japan story.

Okay. Great. And then just maybe going back to capital deployment and following up on Ross' M&A question, I guess, in general, when you think about the candidates or the targets that are in your pipeline and sort of the mid to smaller size of things, I mean, are the majority of them on the private side? Are you actually finding a handful of public assets that are interesting, too? Marc N. Casper - President, Chief Executive Officer & Director: Yeah. I mean, this industry is mostly private companies, right, in terms of the number of companies, right. So there's a huge pipeline of those. We continue to look at those closely and every once in a while you'll see us be able to get one over the goal line.

Thanks very much. Marc N. Casper - President, Chief Executive Officer & Director: You're welcome.

Your next question is from the line of Doug Schenkel from Cowen & Company. Your line is open. Marc N. Casper - President, Chief Executive Officer & Director: Good morning, Doug. Doug, you're on mute? Doug A. Schenkel - Cowen & Co. LLC: I'm on mute. Sorry about that. Talking to myself again. All right. So thanks for taking the questions, guys. So my first question and this has been asked, I guess, in different forms. But just to be pretty direct about this, you guys came in at the low-end of your organic revenue growth guidance for the first quarter. This came after Q4 growth that was much stronger than most of us expected. In hindsight, was there some pull-forward of revenue into Q4 at the expense of Q1? And if so, in what geographies and end markets was this most notable and was this not apparent to you until the very back end of the quarter? Marc N. Casper - President, Chief Executive Officer & Director: So, Doug, interestingly enough, if you think about what happened a year ago and what happened this year, you have similar patterns. Very, very strong finish to the year and then a softer Q1. And Pete when he laid out the guidance said, Q1 will be a little bit softer than the balance of the year. And what I would say the dynamic is, if you think about what happened in both of those years, nothing really bad happened in the world. And one of those calls, you heard me say this, right. Customers keep a certain level of money on the side to manage for a disaster, right. In both 2013 and 2014, the way the world ended, things were okay. So people release funds very late in the year. That…

Your next question is from the line of Isaac Ro from Goldman Sachs. Your line is open. Isaac Ro - Goldman Sachs & Co.: Good morning. Thanks. Just a couple cleanups for me. Could you maybe, Pete, give us a sense of the impact to gross margin in terms of the FX headwind, just how much of a headwind that was? Peter M. Wilver - Chief Financial Officer & Senior Vice President: Yeah. So in terms of gross margin, it's about 45 basis points year-over-year, negative. Isaac Ro - Goldman Sachs & Co.: Right, right. Okay. Thanks. And then just another question on BioProduction, if we just kind of look at the competitive landscape, it seems like three out of the four players there or major players all seem like they had pretty good quarters like really strong actually. So I'm wondering if there's a sense at the market there is inflecting and if so, why? Obviously, there's been a lot of momentum in biotech with new biologics and funding, but just curious about what's actually going on in the underlying level, because it seems like everyone there is growing strong double-digits. Marc N. Casper - President, Chief Executive Officer & Director: Yeah. I think you have the combination of drug approvals, biosimilars and vaccines. That combination of those three are really driving substantial growth in that market. Isaac Ro - Goldman Sachs & Co.: And is it fair to say that will kind of progress throughout the course of the year at the current pace? Marc N. Casper - President, Chief Executive Officer & Director: I would say that it should be a strong end market for a number of years ahead. Isaac Ro - Goldman Sachs & Co.: Okay. Got it. Thank you. Marc N. Casper - President, Chief Executive Officer & Director: Thanks, Isaac. Peter M. Wilver - Chief Financial Officer & Senior Vice President: Thanks.

Your next question is from the line of Jack Meehan from Barclays. Your line is open.

Hi. Thanks and good morning. I want to ask just around healthcare utilization maybe for the clinical lab, part of the Lab Products and Services business. Just curious what you're seeing there within the 3% organic growth that you put up seeing some signs from HCA put up a good quarter and some of that, I think, is optics, but just really around utilization and your thoughts there. Marc N. Casper - President, Chief Executive Officer & Director: Yeah. So in terms of the diagnostics and healthcare, I think U.S. was generally okay in terms of utilization. You still have the pattern, which is incredibly exaggerated meaning that it's now the lowest. That set of activity is Q1 and it builds steadily as people meet their deductible limits during the course of the year. But I think that pattern is roughly normalizing. So you have low level activity, but your growth rates are somewhat similar throughout the quarters. I mean, it's basically what's going on. So nothing dramatic to note in Q1 in terms of utilization.

Got it. And then just the last one. And leaning sort of into the FX with the cost synergies coming up a little bit for life through year end, I was just curious if it changed your thoughts at all around what you viewed as being the three-year opportunity around what you could potentially earn on that side? Peter M. Wilver - Chief Financial Officer & Senior Vice President: In terms of the three-year outlook, we're still holding to the $300 million of cost synergies and $50 million of pull-through on revenue synergies.

Got it. Okay. Thank you. Marc N. Casper - President, Chief Executive Officer & Director: You're welcome.

Next question is from the line of Peter Lawson from Mizuho Securities. Your line is open.

Pete, just with the FX impact, has that made you to think differently about hedging programs or degree of natural hedging or the debt structure? Peter M. Wilver - Chief Financial Officer & Senior Vice President: Well, we obviously we put in some euro debt last year, which helps a little bit. We're actually seeing a little bit of below the line impact from that. Part of the synergy actions that we're putting in place is trying to convert some of our suppliers to local currency to improve our natural hedging position. We don't have a ton of that. But we are out of sync in a few geographies. So we're working on that. In terms of just regular overall hedging program, we don't intend to put anything in place with regard to that.

And is there any change in the debt paydown strategy? I'm wondering if you could just talk to the targets again? Peter M. Wilver - Chief Financial Officer & Senior Vice President: No. We haven't changed our strategy on debt paydown. We're shooting to get down to about between $12 billion and $12.5 billion by the end of the year. That gets us in just below the 3 range so back in our target leverage ratio range.

Great. Thank you so much.

Melissa, we're going to take one more question.

Your last question is from the line of Paul Knight from Janney Capital. Your line is open.

Hi, Marc. Convenient INTERPHEX yesterday looking at your products, the question is where are you with the API (sic) [ASI] (59:37) acquisition and the integration of it? Marc N. Casper - President, Chief Executive Officer & Director: So in terms of – Paul, thanks for the question. In terms of the ASI, we closed in February. I had a great opportunity to meet the team there and the integration is going very smoothly. Very complementary to our existing single-use technologies, it brings some new product range as well in terms of connectors, which is an important step in the workflow and gives our customers the choice now of the second film, which for certain biologics would be very useful for them. So it gives us a more complete offering, which we very much value.

So... Marc N. Casper - President, Chief Executive Officer & Director: Go ahead, Paul.

On the consolidation within the biological production market, is there much left to do in that market? Is it fragmented or not fragmented in your view? Marc N. Casper - President, Chief Executive Officer & Director: There's a lot of competitors still out there. So for sure there's quite a competitive landscape. And we have our niches of strength, others have theirs. And so it's an area with great market growth and we have great competitive position, but there's quite a few different companies there out in the landscape.

Great. You seemed excited there. Thank you. Marc N. Casper - President, Chief Executive Officer & Director: Paul, thanks. So let me wrap it up. We feel good about our accomplishments in Q1. We are in a great position to deliver another strong year and, of course, we look for to updating you on our progress next quarter and seeing you in New York City later in May. Thanks, everyone.

This concludes today's conference call. You may now disconnect.