Welcome to the Third Quarter Earnings Release Call. My name is Christine and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I will not turn the call over to Terry Gregg. You may begin.

Thank you operator and thanks for joining us today on our third quarter earnings call for 2012. I am going to ask Steve Pacelli to initiate our call with the Safe Harbor statement. Steve?

Thanks Terry. Some of the statements that we will make in today's call may constitute forward-looking statements. These statements reflect management's expectations about future events, operating plans, and performance and speak only as of the date hereof. These forward-looking statements involve a number of risks and uncertainties. A list of the factors that could cause actual results to be materially different from those expressed or implied by any of these forward-looking statements is detailed under Risk Factors and elsewhere in our annual report on Form 10-K, our quarterly reports on our Form 10-Q and our other reports filed with the SEC. We undertake no obligation to update publicly or revive these forward-looking statements for any reason. Terry?

Thank you, Steve. Joining me today are, Kevin Sayer, our President; Jess Roper, our Chief Financial Officer and of course Steve Pacelli, our Executive Vice President of Strategy and Corporate Development. Our agenda for today’s call is fairly typical. I will provide a brief update on our G4 PLATINUM approval and launch activities. Kevin will review our third quarter 2012 financial results and provide our customary operations update and then I will offer some concluding thoughts. So as most of you are aware, on October 5, 2012, we received approval from the Food and Drug Administration to begin commercially marketing the DexCom G4 PLATINUM continuous glucose monitoring system, our fourth generation CGM System. We received approval for a full PMA in just under 180 days, a credit to the outstanding work of our clinical and regulatory teams and a testament to the collaborative working relationship we have established with FDA over the past several years. We believe G4 PLATINUM sets a new standard for performance. It is the most accurate and reliable continues glucose sensor ever commercialized and we believe this sensor system will create an extraordinary patient experience and will drive category adoption of CGM. As we mentioned during our G4 PLATINUM Approval Conference Call, we began building both hardware and sensor inventories in the third quarter in anticipation of approval. We began taking orders for G4 PLATINUM immediately. And I am pleased to report that we completed our initial G4 PLATINUM shipments to patients in the U.S. late last week and have commenced full scale order fulfillment this week. Our initial focus has been processing orders for new patients, although we expect to begin to upgrade existing SEVEN PLUS users who desire to move to the G4 PLATINUM starting this month. We are working to complete all of our upgrades by the end of 2012. The U.S. launch of G4 PLATINUM has generated a higher level of excitement at DexCom than any of our previous commercial launches. As I stated in our call in early October, patients, partner and physician response at the Berlin Meeting of the EASD in early October was exceptional. Growth in our international markets truly reflects this excitement. As one would expect our pipeline of new patient opportunities is at the highest level in the history of the company. The number of daily calls into our customer service organization is up over 50% when compared to pre-launch. And while it is too early to determine whether this call volume will be sustained, we are certainly keeping busy processing orders for G4 PLATINUM. In fact, call volume has been so high that our team has had little time to actually process all of the orders. Contrast that excitement with the operational challenges of launching a product in the same month that we received approval. For example, we could not even begin to print user guides until we received final approval from FDA, and yes, we immediately announced approval knowing full well that all new SEVEN PLUS kit sales would come to a complete halt while we assembled final G4 PLATINUM kits. Fortunately, our pre-launch planning activities ensured that we will have sufficient inventories to meet patient demand during the quarter. A task made particularly challenging now that we offer multiple color receivers and need the forecast of the appropriate build of colors. Aside from patient and clinician excitement, the G4 PLATINUM approval has created much stronger interest than we have ever experienced with potential clinical trial partners; while we have been providing blinded product for clinical trial use for the past several years, we now believe that the clinical segment represents a meaningful business opportunity. For example, a number of pharmaceutical companies have recently suggested to us that CGM is an important tool to demonstrate the effectiveness of future diabetes compounds. However, they have expressed a strong dissatisfaction with competitive CGM systems used in prior trials to the point they have ceased using CGM in their studies. We believe our G4 PLATINUM system combined with our sweet spot cloud based data management capabilities and Qualcomm Communications platform will offer a very robust solution to these potential partners and we will be gearing up for this opportunity next year. It is important to keep in mind that this is the first new product launch by DexCom in over 3 years. So our field sales force is extremely excited about demonstrating the product to health care providers and I am pleased to hear from numerous physicians and educators that they have been eagerly anticipating the G4 PLATINUM in their practices. Above all, I would like to acknowledge the hard work of the people at DexCom who have made this launch possible. Finally, our revenue guidance for 2012 has been $85 million to $92 million for the year and while we don't have a crystal ball for the balance of Q4, in light of what we have seen so far with patient interest in the G4 PLATINUM system, we expect our full year product revenue to land at about the mid-point of our range. With that I would like to turn the call over to Kevin Sayer.

Thanks, Terry. I will start with the financial update. DexCom generated $21.1 million in product revenue for the third quarter of 2012, compared to $16.7 million for the same quarter in 2011, a $4.4 million or 27% increase. During our G4 PLATINUM approval conference call in early October, we stated that we expected product revenue for Q3, 2012 due to be approximately $22.2 million prior to any adjustments related to our G4 PLATINUM launch and subject to completion of our closing processes. After internal analysis and review by independent auditors, it was determined that we should reserve an additional $1.2 million for sales returns related to our 30 day money back guarantee on DexCom hardware. As we discussed during the G4 PLATINUM approval call DexCom has always maintained a 30 day full refund policy on our hardware. As part of our G4 PLATINUM launch, we elected to extend this offer for patients who purchased SEVEN PLUS hardware from September 1 through our G4 PLATINUM announcement date of October 5, while historically very few patients have returned products under the terms of our 30 day money back guarantee, we expect a significant number of patients to take advantage of the offer through exchange for G4 PLATINUM. This $1.2 million reserve resulted in a dollar for dollar reduction of product revenue for the quarter. Our product revenue growth for Q3 2012 over Q3 2011 would have been 34% without this increase in the returns reserves. It is also important to note that we plan to recognize most of this reserve as product revenue during the fourth quarter of 2012 as we shift G4 PLATINUM hardware to these patients. Sequentially, product revenue for Q3 2012 decreased 2% from the prior quarter. However excluding these additional sales returns reserves, product revenue would have increased 3% sequentially. As we stated in our G4 PLATINUM approval call, we believe that many purchase decisions during Q3 were deferred as patients and health care providers anticipated the G4 PLATINUM approval and introductions. Total revenue for the third quarter of 2012 was $23.1 million, compared to $18.3 million during the same quarter in 2011. Our product gross profit totaled $7.7 million, generating a gross margin of 36% for Q3 2012, compared to a gross profit of $7.4 million and a gross margin of 45% for the same quarter in the prior year. As we discussed during the G4 PLATINUM approval call, we recorded a number of one-time charges that have negatively affected our gross profit and gross margin for the quarter, specifically we recognize approximately $500,000 in cost of goods sold from SEVEN PLUS hardware we shift in September, where we recognize no revenue related to those shipments due to the increased sales returns reserve discussed previously. We also wrote off approximately $2.5 million in excess of obsolete inventory related both to the SEVEN PLUS and the SEVEN PLUS upgradeable product we discussed during the G4 PLATINUM call that we no longer expect to sell, and we shortened the useful life of and recorded additional depreciation expense of approximately $600,000 related to certain fixed assets used for SEVEN PLUS manufacturing and testing. Absent these onetime charges, our product gross profit would have been $11.9 million generating a product gross margin of approximately 54%. Sequentially, our product gross profit decreased $2.9 million on decreased sales of $400,000 over the prior quarter and our gross margin decreased 13 margin points. However, excluding the charges we've discussed our product gross profit would have increased $1.3 million; our corresponding gross margin would have increased approximately 5 margin points over the prior quarter. Some final thoughts on our revenue and gross profits during Q3. Our split between consumable and durable revenues was again between 70% and 75% consumables and between 20% to 30% durables and the ASP for sensors remained constant while the ASP for our durables was affected slightly by our rebate program for SEVEN PLUS which was offered only during the month of September. Our international business continue to perform well in Q3 accounting for just under 10% of our product revenue in the quarter. On the domestic distributor front, our revenue split between direct and distributor business remained consistent with the prior quarter. And with respect to Q4 we expect sales and gross margins to be affected by a number of additional factors related to our G4 PLATINUM launch, including the impact of reversing our sales return reserves, the impact of our $399 in warranty upgrade programs and our manufacturing scale up activities. Research and development expense totaled $10.6 million for Q3 of 2012 compared to $8.2 million in Q3 of 2011. The increase primarily resulting from costs associated with our SweetSpot platform, expenses related to our G4 PLATINUM pediatric trial, G4 PLATINUM scale up cost and continued investment in our next generation products. Sequentially, R&D expense remained relatively flat. Selling, general and administrative expenses totaled $15.5 million in Q3 of 2012 compared to $13.2 million during the same quarter in 2011. The increase primarily related to sales, marketing and information technology costs to support revenue growth. $600,000 of this year-over-year increase is centered in non-cash share based compensations. Sequentially SG&A expenses remained relatively flat. Our net loss for the third quarter of 2012 totaled $17.3 million and included $6.9 million in non-cash expenses centered in share based compensation, depreciation and amortization as well as $4.2 million in non-cash charges and reserves discussed previously. Absent all of these non-cash charges our net loss for the third quarter of 2012 would have been $6.1 million. Our loss per share for the quarter was $0.25 and again absent our one-time charges our loss per share for the quarter would have been $0.19. We ended the quarter with $53.4 million in cash and marketable securities and had working capital of $55.2 million. One additional note regarding the balance sheet, today we entered into a loan and security agreement with Silicon Valley Bank at Oxford Finance that provides a $15 million revolving line of credit and up to a $20 million term loan to be used for general corporate purposes. The revolving line of credit is in interest only financing that bears an interest rate equal to the prime rate plus 0.5% and requires repayment of the principle at the maturity date in November of 2015. Under the term loan arrangement, $7 million will be advanced on the funding date and after $13 million and additional funds, will be available upon our request from June 1, 2013 to September 30, 2013. The term loan, there is a fixed interest rate equal to the 3 year treasury rate at the time of the advance plus 6.94% and requires payments of interest only for the first year and amortized payments of principal and interest thereafter through the maturity date in November 2016. There are no conversions features or warrants associated with this facility. Now, I'll turn to the business updates. Regarding our product pipeline, I am pleased to report that we had completed our pediatric clinical trial we expect to file a PMA supplement in the U.S. and update our CE mark in the EU to obtain an expanded indication for G4 PLATINUM before year-end. We're especially excited about the prospects of a pediatric indication that is not only significantly expands the number of endocrinologists we can call in the U.S., we expect to be able to recommend our technology to patients as young as 2 years old which should be a first for CGM. On the international front, we’ve recently received approval in Australia and we expect approval in Canada and India within the next 6 months. We're actively exploring opportunities in China and Japan and other Asian geographies. We continue development of the Gen5 system working on an improved applicator combined with a mobile phone interface. We continue to have discussions with the FDA on this front and we believe that DexCom is in a very strong position to become the first Class III medical device to communicate directly to mobile platforms. We have already seen several early phase mobile based systems and many of the artificial pancreas programs that display our data on a mobile computing platform and remain very encouraged on this front. Shifting to our integration partnerships, Animas continues to commercialize the Animas Vibe system in Europe and it was made abundantly clear to us by the European Physician Community at the AST in Berlin last month that system is being very well received by patients and physicians in the EU. With regards to filing for U.S. approval of the Animas Vibe, the work required to modify the system to accommodate G4 PLATINUM in the U.S. has taken slightly longer than expected, but we believe we will complete all development and system testing and be in a position to file early next year. We are pleased to note that our newest partner, Tandem Diabetes Care reported their first commercial shipments during Q3. We are actively working with Tandem to accelerate our development efforts and are nearing completion of our feasibility assessment of incorporating G4 PLATINUM into the Tandem system. We are optimistic that feasibility will be successful and hope to be in a position to define our path forward with G4 PLATINUM before the end of the year. Finally on the Edwards front, work on the second generation in hospital glucose monitoring system is near complete and as Edwards mentioned in their recent earnings call, they expect to obtain a CE mark for the second generation GlucoClear system before the end of 2012. I would now like to turn the call back over to Terry for some concluding remarks.

Thanks, Kevin. We created the G4 PLATINUM CGM system with the customer in mind through a series of customer surveys and regular CIM outreach and dialogue. One could consider our approach to crowd sourcing from people with diabetes with a focus on the consumer experience influencing our design. It is certainly a sleek slender design for discretion and portability to meet an active lifestyle. When incorporated customized tones and melodies for alert to glucose levels and increased the wireless transmission distance by some 4X to improve data capture, particularly around the house. But we are glucose sensor technologists and the best in the world. We improved the overall accuracy by approximately 20% and by 30% in the hypoglycemia range. Hyper detection, sensor precession and sensor longevity will all improve resulting in exceptional sensor stability and accuracy over time. So that from start to finish sensitive sensor, our customers can expect extremely consistent performance. Initial customer reactions to wearing the product has met or exceeded our expectations. The blogs are filled with positive comments regarding the accuracy, durability, convenience and user friendliness of the G4 PLATINUM. We are now replacing the SEVEN PLUS systems with G4 PLATINUM in the artificial pancreas trials. So you should expect to see those results as early as next week at the diabetes technology meeting in Bethesda. I said it before the launch and I am more convinced than ever that the G4 PLATINUM is transformational and the utilization, understanding and uptake of CGM as a critical component of diabetes care. We are truly answering the promise of CGM. Thank you and operator, we will turn it over for question and answer.

[Operator Instructions] And our first question is from Ben Andrew of William Blair.

Terry, I think I missed the number on the upgrade number and timing that you gave early on, can you repeat that and kind of talk through how quickly you think you can get everybody upgraded that perhaps wants to in the first phase?

Yes the upgrade, we didn't give you an actual upgrade number but we are starting to identify that now and begin to ship out. Our goal Ben, is to complete that by the end of this year, so by the end of December.

And do you have a sense of what percentage of patients are likely to do that. I know that's what you are trying to figure out but that would be awfully aggressive to get SEVEN PLUS mostly shutdown by the end of the year, wouldn't it?

No, no, this is upgrade so you've got to look at those. The upgrade program is for those patients who are in warranty and we provide them an upgrade for $399. Then the next group are patients that are out of warranty and they would be responsible for the whole initial new starter kit. So we've just looked at, so the number is not as big as you think it is from that standpoint. We certainly have a number of immediate requests of those patients wanting to upgrade for $399 in particular. We are addressing first the brand new patients and that was my number of increase in calls of over 50% versus our pre-launch number of patient calls coming in but again our goal is to address obviously both of those segments but first the new patients followed by the upgrade patients.

Okay. Do you have any better sense of what chunk of existing patients are going to want to switch to this? I know your goal is ultimately to get people over there, but is it timing; do you have a timeframe in mind when you want to get people off of SEVEN PLUS one way or the other?

Yes, our timeframe would be as soon as possible so we could shut down SEVEN PLUS. I don't have the optics; remind the audience we've been now shipping for less than 2 weeks. Our phones are ringing off the hook and there is a lot of moving parts right now obviously we will try to give clarity as soon as we can, but right now we don't have the kind of optics that I think you are looking for.

Okay. And then Terry any, you gave some good commentary on the pediatric indication and maybe that was commented on, but did you update the timing there or is that still on track for kind of mid 2013?

Our belief is its on track for that mid 2013, the commitment that we made to the organization and actually the team made to FDA in a face-to-face meeting recently, that we would file that with the agency before the end of the year like any PMA supplement statutorily, they have a 180 days to review and complete. We are hopeful that based on the fact that this is a supplement to data that they are really looking at the clinical aspects of it. Obviously, not the degree of numbers of more than 9,000 matched pair points that we had with the adult trial and we are not doing the rigor of having to do intravenous blood sampling of these patients, but they should be able to look at that in straight order, and I know that they are very interested in expediting this. They are very happy when we told them that the trial was complete.

Okay, and finally, Kevin any new learnings relative to manufacturing as you start ramping more aggressively with the new product or things that are on track there?

Every day there are new learnings towards manufacturing, but yields are getting better on a weekly basis on our center lines. We turned everything on full blast and we talked about during the call, full scale as we are getting approval. So we learn a bit every day but things are going well. I guess, one of the more interesting learning experiences, Terry talked about the mix of colors, figuring out how many people wanted to buy our receiver that’s call Tickled Pink; it’s been a learning experience for us. We’ve had pretty good demand on the color front. So it's all been good. No major surprises.

Our next question is from Tom Gunderson of Piper Jaffray.

The same kind of question Ben asked on Animas, you said slight delay in early 2013, do you think there is still a reasonable possibility or probability that you could have this finished by ADA?

Yes Tom, this is Steve again, with that 180 day timeframe, I think the answer is possibility, probably not probability I would say, if we get this filed very early in the first quarter of next year. I think there is still an outside chance. I think it’s definitely what we committed to you previously was the second half of next year, stretchable, trying to get to ADA and I think that’s still our plan. We just without rehashing all the old details, as we move from the old what was Gen-4 to the G4 PLATINUM, we had to do some systems upgrading on their side and we just have to get through the final system validation, verification testing and literally just then get the paper work done.

Got it and then on Tandem, I think the original agreement was for Gen-5 to go along with Tandem and you are talking about Gen-4. Do you think, is that something that we should plan or is that still in the negotiation stage?

Actually, from a business perspective, there is no real negotiation. We’ve already agreed with Tandem that if we collectively can prove that it’s feasible, what I mean by that is you will remember that Gen-5 architecture is much simpler to integrate with potential partners because all of the intelligence resides in the transmitter. So with Gen-4 the partners required to actually put some additional hardware into their [indiscernible] in this case the durable pump; we’re just at the final stages of feasibility testing to make sure for example, that the transmitter can communicate appropriately from send and receive the RF signal is a best example. We are very, very close to kind of final sign off the both engineering teams that the G4 PLATINUM system will work inside the Tandem pump; we have built actual prototype pumps and we are testing them today. So I think the answer is, the high likelihood, I don’t want to tell for your sure, but it’s a high likelihood that the Tandem will move to the Gen-4 really because they are looking to accelerate their entrée into CGM.

One more partner question and then a quick customer service question, and that would be on the partner side, Steve, any update on Insulet and combining Gen-4 with their next generation?

Yes not really an update; there is nothing, at this point nothing going on there.

And then Terry a customer service question, when you say 50% increase from pre-launch, post launch can you give me a sense of that because you also said that maybe people were waiting for Gen-4, maybe customer service calls were lesser in advance of this; sp what kind of calls were you getting relative to what you are setup for? And the second part of that question would be, do you need to temporarily boost labor there to handle the calls?

Well, my comment of 50% was greater than on average of what we are experiencing and that was, although we believe that there was a decision by physicians and patients not that there was a belief, we actually were told that by both constituents that they were waiting. We certainly, if you just look at the growth of the business, we have continued to build that customer base in anticipation all along. So we didn't see any dramatic fall off from that customer call pattern. And we continued as part of that call pattern to customer service to fulfill the sensor orders as well and the more starter kits that we put in the market, the more sensors that we also put into the market, so I would say that this 50% increased was truly a dramatic increase as a first part. Second part, I try to caution the audience by saying we are not sure if that's going to be sustainable or not. We have not seen any big drop off, but again we are really 3 weeks into this and so we don't know, we just don't have the optics on what November is going to look like as an example and then of course we again we go into December which is always our largest month regardless and that's kind of a DME experience for all parties in that world. Your third question regarding, do we need to staff up. We are monitoring that, we do have the ability to do some shifting and if you look at kind of the way we train people, we like to have expansive training in the customer service for the patient level, we can shift resources as necessary even involving tech services, one of the beauties of the SEVEN PLUS is that we've seen the number of calls to tech services go down over the year. And we certainly expect that to further decrease in tech services because Gen4 is a better product. And so we can shift some of those resources if necessary. So I think we certainly don't want to add to it unnecessarily in terms of the cost component, but we literally monitor the number of ops coming in every single day and make adjustments for the next day.

Our next question is from Bill Plovanic of Cannacord.

Just a couple of questions, one, you gave an update on Edwards, I think you talked about, did you say the Gen2 is near completion and CE before year end ’12, is that were you referring to the U.S. as well, when you say the Gen2 is complete.

The product is complete, the timeline for approval is just for CE mark approval before the year end.

And any update on the U.S. for Edwards?

I don't have an estimate for the U.S. timeline at this point. Quite frankly we are still somewhat waiting on the FDA to weigh in as to what the acceptable approval criteria would be in terms of performance for the system. And that's something, that's going to be 2013 discussions with the agency is my guess.

Okay, and then just as you kind of move through these onetime charges, I don't think you quantified any for Q4, I was wondering if you could do that and then will all of this have been washed through as we complete 2012?

Bill we don't see any one time charges coming in Q4. We believe we dealt with everything now and that was our plan, and so we believe it will all wash through and as Terry said earlier it’s our goal to get all those upgrades in the system on the end warranty program and also those in the 30 days that we exchange, to try and get all that out of the system in the fourth quarter as well so we can get any effect on margins washed out with that here in Q4 and move forward with a clean slate.

Given that we're moving over to new product, can you provide any color on what you think Q4 gross margin will be?

Yes, as I said in my remarks, there is a whole bunch of things affecting them. I mean as you walk through it, we've got $399 in warranty upgrade program for hardware. Obviously the margins on that it's not going to be real goods. So that will effect negatively. Conversely we have a whole bunch of manufacturing volume going on. That will effect positively and we know Gen4 sensors cost less to build than the SEVEN PLUS sensors. So to the extent we can shift over that, we will have a positive impact. We got a whole bunch of factors going in every which direction Bill. So I wouldn't give any more color than saying just, it's going to be an interesting quarter.

I will say mostly good and even though in warranty upgrade program to the extent we sell $399 hardware, we're still selling sensors to those people with very positive margin. So we look for a good quarter Bill, not for bad one.

Okay, on the 10-day trial and labeling, where are you on that?

I think we are still in planning stages from what that should look like in, as I’ve said previously and I am sure Kevin and Steve have said previously at a variety of meetings, so here is the landscape. As you remember, Gen4 PLATINUM has actually taken a membrane from Gen5 and moving it backwards. That's why it was brand new PMA. But we didn’t stop all of the work from Gen5 on the hardware. So on Gen5 there is 2 new components basically one is a new applicator and one is putting the brains from the receiver into the transmitter. So I think as you look at 10 days, they are going to marry up from a standpoint that’s probably going to be a Gen5 moving forward with a 10 day trial, and part of it is these trials are not inexpensive. So if you look at the Gen4 pivotal trial it’s probably $2.5 million and you add another pediatric portion to that and I don’t know what that final number…

Certainly over $1 million.

Okay, so you are looking at $3.5 million. We want to do that once, not twice. So I think from that standpoint and the fact that in this Gen4 PLATINUM approval there was no requirement at this point from the agency to cause patients to actually remove the transmitter for a restart, and so they will use it as they so desire way - obviously we would like them to use it at the labeled indication of 7 days. But we do have it in our 2013 planning schedule.

Okay, so just in [indiscernible] that the whole concept of longer label is going to be more focused on the Gen5 than the Gen4?

Yes.

Okay. And then last question then I am jumping off is, you have the $15 million revolver and the $20 million term loan. I think the commentary was on the term loan you gave us the interest rate, no warrants was there only warrants on the revolver?

No warrants no dilution Bill.

No dilution on anything.

Our next question is from John Putnam of Capstone Investments.

Terry, can you talk about the economics of those plans that are not under warranty going from SEVEN PLUS to Gen4, what will it cost them to convert?

Well, basically they are going to, my expectations number one, they would use up their SEVEN PLUS sensors. So there is no new cost factor from that standpoint. So what they are going to be looking at is an upgrade to the disposable, I mean to the hardware durable both the starter kit and the transmitter. As we have mentioned before, our average selling price is a little north of $800. So if they are within there and whatever their plan is and majority of our patients have an 80-20 plan. So from an out-of-pocket standpoint, they are probably looking under $200 out-of-pocket for the starter kit and then the standard of what they are paying relative to the sensors, there was no increase in the cost of sensors.

Okay, so you don't believe that you will have to incentivize them to convert?

No, we are not expecting that to be a scenario, in fact even on the - those that were in warranty, we long debated whether or not we should provide an upgrade but again, part of our motivation and Kevin alluded to it, or the fact that we need to get patients into the Gen4 format sooner rather than later because if you just think about the growth of Gen4 we are making more margin on the sensors and that means that we are going to make less margin on the SEVEN PLUS sensors as we go forward. And so at some point, we need to get everybody converted over.

[Operator Instructions] And our next question is from Ben Haynor of Feltl & Company.

First off, what percentage of the people who are eligible for the 30 day return policy have taken advantage of it now?

We are not going to disclose that. Some have filed, we haven't shipped anything to those patients yet but what we did Ben is we came up with an estimate of how many we thought would based upon what we've experienced in the past and that's the reserve that we recorded and so nobody has got a thing yet. We have had quite a few people request it but not all of them and certainly not close to what we've provided for in our reserves yet.

And then kind of a big picture question, you guys mentioned that the blog posts we picked up on our surveys as well, increasing discussion on CPM particularly your Gen4, where do you believe that U.S. penetration is at currently and then I am wondering where you think or how closely are to that tipping point where you really see the adoption accelerate?

Yes, I still think we are in that 6% to 7% penetration as a category. I do believe now that we'll reach that whatever that magical point is. I have always said it’s around 8% or 9% within the next 12 months. Based on and in fact, I have been pleasantly surprised more than I thought I would be with the Gen4. We knew it from a technological standpoint that it was an advanced sensor, accuracy, things of that nature. But I think we didn’t or we underestimate, didn’t anticipate some of the features and benefits that would be highly desirable by patients and that may in fact drive it to a greater degree and faster. Based on some of the comments that we're getting back from our field sales people of their ability to get into accounts and drive some of the interest at accounts that were somewhat resistant for its cumbersome and things of that nature that the slimness and things of that nature of the receiver as an example our extended connectivity are really attributes that are more desirable at the consumer level than we anticipated.

Okay great. That’s helpful and then just one more and I'll jump off. What's the most popular color?

Still black. We are running right now, I think we're running 50, 25, 25.

We have no further questions at this time. I will now turn the call back over to Terry Gregg.

Thank you and I would like to close with a couple of real life experiences with the G4 PLATINUM just over the last couple of weeks that have come in to us. This is from both the health care sector as well as from patients. As an example, we had one resistant physician whose only objection to our CGM was lack of integration with a pump and that’s not uncommon but upon seeing the receiver and accuracy of the G4 stated, integration doesn’t matter anymore and gave our sales rep a list of 10 patients to initiate contact with regarding CGM. So we look at that and we say imagine the day when we're able to transmit directly to a Smartphone with our next generation. We truly opened the opportunities. We have also heard from both patients and physicians that G4 will enable them to use CGM first before moving to pumps. If they move to pumps at all and this has been our philosophy and our marketing message. So it is nice to see that kind of attraction. And finally, from a parent with a family member playing a soccer game, the highlight of the game was his ability to hold his son's monitor the entire game and keep track of his glucose due to the extended range of connectivity. He added, there is a helplessness of watching your kid play an innocent game worrying if he got his insulin correct. And these are the things that I was just talking with Ben about that these are some of the intangibles that are really tangible in terms of driving market awareness and adoption. So this is the power of the G4 PLATINUM and these experiences validate what we are trying to achieve and particularly over the next 3 years as you see this innovation move into a consumer world of how we view the glucose monitoring world. So with that I will close and say thank you very much for your participation today.

Thank you ladies and gentlemen. This concludes today’s conference. Thank you for participating. You may now disconnect.