Asher Dewhurst – Westwicke Partners, LLC Nancy S. Lurker – Chief Executive Officer Jeffrey Smith – Executive Vice President, Chief Financial Officer, and Treasurer

Roberto Fatta – William Blair & Company

Good morning. My name is Wendy, and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter 2014 PDI Financial Results. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be a question-and-answer session. (Operator Instructions) Thank you. Mr. Dewhurst, you may begin your conference.

Good morning, everyone. This is Asher Dewhurst from Westwicke Partners. Thank you for participating in today's call. On the call today from PDI are Nancy Lurker, Chief Executive Officer; Jeff Smith, Chief Financial Officer and Greg Richard, Senior Vice President and General Manager of PDI’s Molecular Diagnostic subsidiary Interpace Diagnostics. Yesterday PDI issued press releases covering the acquisition by Interpace Diagnostics of the thyroid and pancreatic test portfolio of Asuragen. The addition of molecular diagnostic industry veteran Heiner Dreismann to PDI’s Board of Directors, and financial and operational results for the second quarter ended June 30, 2014. If you have not received these news releases but would like to be added to the company's distribution list, please call my office at (443) 213-0503. Before we begin, I would like to caution that comments made during this conference call by management will contain forward-looking statements that involve risk and uncertainties regarding the operations and future results of PDI. I encourage you to review the company's financial filings with the Securities and Exchange Commission, without limitation to – including the Forms 10-K and 10-Q, which identify specific risk factors that may cause actual results or events to materially differ from those described in the forward-looking statements. In addition, certain non-GAAP financial measures, specifically adjusted EBITDA, which management uses to measure cash flow of the ongoing business will also be referenced on this call. The content of today’s conference call contains time-sensitive information that is accurate only as of today’s date, August 14, 2014. The company undertakes no obligation to revise or update any statements to reflect the events or circumstances after the date of this conference call. With that said, I’d now like to turn the call over to Nancy Lurker. Nancy? Nancy S. Lurker: Thank you, Asher, and welcome to everyone on the call. Let me start off the call by saying that we are very pleased to announce our transaction with the Asuragen and the addition of Heiner Dreismann to our Board of Directors. The Asuragen assets are our first acquisition on our path towards establishing a commercially-focused molecular diagnostic subsidiary. This transaction is a pivotal step in our stated growth strategy of leveraging our extensive commercialization infrastructure to expand into the higher growth, higher margin molecular diagnostic industry. Further, the addition of Heiner Dreismann a Molecular Diagonstic Senior Executive to our Board demonstrates our commitment to this market. I’ll provide more specifics later on the call. Let me now provide some highlights from our second quarter and update you on our outlook for the reminder of the year. As we have said since the beginning of the year, we expected 2014 revenue for the full year to be lower than last year. In the second quarter, we generated revenue of $32 million and 15% decrease compared to the year ago period. This decrease was primarily a result of the softer RP volume that we experienced in the fourth quarter of 2013 and first quarter of 2014. In addition, a number RPFs that were available in the second quarter of this year were not awarded or have been delayed due to FDA delays, client management changes, and decisions to in-source. Let me reiterate that these types of fluctuation are typical for the CSO business. From a profitability standpoint gross margins of 15% were inline with our expectations and reflect what we believe is typical in the industry today. Adjusted EBITDA in the quarter a loss of $1.5 million compared to a small positive in 2013 was primarily due to spending on our key initiatives and lower gross profits. Turning now to the specifics of the Asuragen transaction. As I mentioned at the opening of the call, this is our first acquisition in the molecular diagnostics space and begins the process of establishing Interpace Diagnostics in this high growth, high margin business. For this particular transaction we acquired Asuragen’s miRInform Thyroid and miRInform Pancreas oncology testing assays, associated intellectual property, a large biobank of over 5,000 patient tissue samples, and additional tests in development. Terms of this transaction include $8 million in cash up front, future commercial milestone-based payments, and royalties. The miRInform Thyroid test is on the market today and currently generates approximately $2 million in revenues. Of note is that Asuragen has not focused on commercially investing in this assay for the last year due to their focus on the contract research and genomic services business and lack of significant installed commercial infrastructure. In our hands, we believe that, by applying our commercial capabilities and expertise, we expect to see meaningful growth through expanded adoption across the US in this product over time. The market for miRInform Thyroid is approximately $350 million. Due to aging demographics and other environmental factors, thyroid cancer is one of the fastest growing cancers according to the National Cancer Institute. MiRInform Thyroid provides a high malignant predictive value of 86% for thyroid nodules independent of cytology diagnosis and 81% for nodules which are deemed indeterminate by cytology. The test, administered by pathologists and endocrinologists, utilizes 17 genetic markers to aid in the medical management of thyroid cancer. This process improves pre-operative diagnostic accuracy and helps doctors characterize the malignancy, even if on a microscopic level patients’ biopsy samples are indeterminate. MiRInform Thyroid has established CPT codes and has a retail price of approximately $3000 per test. In addition to MiRInform Thyroid as part of the transaction we’re also acquiring miRInform Pancreas, which focuses on pancreatic cancer. MiRInform pancreas is a yet to be launched proprietary assay consisting a five microRNA markers. MicroRNA’s are short nucleic acid sequences that are powerful regulators in a wide variety of diseases. In addition they are more stable than messenger RNA which is also widely used in diagnostic assays. miRInform Pancreas is a clinically validated assay for solid pancreatic masses which are classified as either indeterminate or benign through traditional cytology. As background pancreatic cancer is a devastating disease with over 46,000 projected new cases in 2014 and close to 40,000 projected deaths in the US alone. Today there are limited options for physicians beyond traditional pathology to determine if pancreatic masses are malignant or not, especially in the presence of chronic pancreatitis. Currently, endoscopic ultrasound-guided fine-needle aspiration otherwise known as EUS-FNA is used, which in the presence of chronic pancreatitis can have a sensitivity as low as 54%. This means that EUS-FNA is very poor at predicting true benign masses, especially in the presence of pancreatitis. Given that pancreatic cancer is highly aggressive, there remains an acute need to reduce false-negative reports so that treatment can begin earlier for this devastating cancer. We expect to launch miRInform Pancreas in the first half of 2015 and are very excited about the potential impact from this test on the pancreatic oncology market, as there is really nothing like it out there today. Finally, in addition to miRInform Thyroid and miRInform Pancreas, we also acquired two additional tests in development, both of which focus on thyroid cancer and our complimentary to both miRInform Thyroid and the oncology diagnostic product that we acquired the rights to last year. As we have disclosed, we are engaged in a large multicenter prospective clinical validation study on this test, and expect to be in a position to make a decision on exercising our in-license option by year-end. Consequently, we are very committed to the thyroid diagnostic oncology market and plan to continue to invest in bringing additional tests in order to offer to physicians a comprehensive suite of thyroid oncology products in this large and growing $350 million market. In summary, the Asuragen transaction is the first step in the overall execution of our Interpace Diagnostic growth strategy by providing Interpace with two commercially-ready diagnostic products and a number of follow-on assets to drive its growth and profitability. Our initial foray into the diagnostic business focuses on the thyroid and pancreatic diagnostic oncology market, both with high unmet need and strong growth potential. We intend to fully leverage our extensive and well-proven commercial capabilities to physicians through the PDI commercial platform and believe that these tests are tailor-made for our extensive capabilities in the healthcare commercialization arena. Now one final piece of Interpace Diagnostic news. As of July 1, we officially terminated our agreement with Transgenomic to commercialize their CardioPredict test. We concluded during our pilot activities on CardioPredict that the long-term profit potential for Interpace Diagnostics in oncology was much higher. As I have mentioned before, we are constantly evaluating new and groundbreaking tests for future commercialization opportunities. We are taking a thoughtful and measured approach to bringing future partners or acquisitions on board and we look forward to keeping you posted on our process in the near future. I can tell you that we are actively pursuing opportunities that would further complement our focus in thyroid and pancreatic cancer and hope to close on at least one more opportunity before year-end. If we choose to move forward with some of these opportunities, we will be utilizing more of our cash and likely some form of debt financing. With all that said, relative to our outlook for 2014, we continue to expect revenue in our core business, which is everything except all activities related to Interpace Diagnostic, to be slightly down for the third quarter and full year compared to 2013. Even assuming that there are no early terminations and we win a normal level of new business for the remainder of 2014. We continue to anticipate a full-year operating loss for the core business in the range of $4 million to $5 million and adjusted EBITDA for the core business approximately breakeven for the full year. Relative to Interpace Diagnostic, while we now expect a modest amount of revenue from miRInform in 2014, we do expect a higher net loss than the $3 million originally anticipated before the acquisition of Asuragen assets. We expect to add additional selling and marketing and prelaunch resources to support the anticipated ramp-up of revenue in the acquired Asuragen assets. As a consequence, we believe the net loss for Interpace Diagnostic could be in the range of $5 million to $6 million for the full year as we invest in these assets. Given the cash requirements related to the Asuragen acquisition and excluding the impact of other transactions that could develop, we estimate cash at year-end in the range of $22 million to $25 million. I’ll now turn the call over to Jeff for a more detailed review of the financials.

Thank you, Nancy. As Nancy summarized and as we anticipated, second-quarter revenue of almost $32 million was about $6 million, or 15%, lower than last year. Sales Services revenue for the second quarter of approximately $28 million was about $4 million or 13%, lower than last year as the natural expiration or reduction of certain contracts more than offset revenue from new contract wins and the recent smaller pipeline. Marketing Services revenue for the second quarter was about $600,000 about a $1 million lower than last year, and product commercialization revenue for the second quarter was about $3 million, almost the same as last year. Second-quarter 2014 gross profit was about $5 million, a decrease of about $2 million compared to last year. At the same time, the gross profit percentage in the quarter decreased to 15% from 18% last year, also in line with what we anticipated. Sales Services gross profit for the second quarter of about $5 million was about $500,000 lower than last year. Gross profit percentage in Sales Services, as anticipated, decreased from – to 15% from 18% due to the competitive factors we’ve been discussing. Marketing Services gross profit for the quarter was a negative $500,000 compared to a profit of $600,000 last year due to lower revenue and costs associated with the launch of PD One and the update of The Medical Bag. For the second quarter of 2014 total operating expenses were $7.3 million compared to $7.7 million last year, this decrease was achieved despite continued investment in our strategic initiatives. The net impact of changes in revenue, gross profit, and operating expenses is a net operating loss of $2.5 million for the quarter compared to $800,000 last year. In terms of liquidity and cash flow, adjusted EBITDA, which you know as our non-GAAP measure of cash flow from operating activities, was a loss of $1.5 million for the second quarter due primarily to investments in strategic initiatives and lower gross profits. Cash and cash equivalents at the end of the quarter totaled nearly $36 million down $10 million from year-end. This decrease in cash was primarily due to the increase in working capital requirements and investments in our strategic initiatives. Finally, as of June 30, the Company’s cash was predominately invested in Treasury money market funds and the Company had no commercial debt. I will now turn the call back over to Nancy.

So in closing, we are now poised to execute on our stated strategy of entering the commercial molecular diagnostic space, which I am very excited about, while leveraging our healthcare go-to-market platform. We remain incredibly enthused about our entry into the thyroid and pancreatic oncology diagnostic space. Finally I want to welcome Heiner Dreismann to our Board of Directors. Heiner joins the PDI Board at a critical juncture and has nearly 30 years of experience in the diagnostic industry and extensive background in molecular diagnostics in particular, including his former tenure as President and CEO of Roche Molecular Systems, where he grew the business in excess of $1.2 billion. Heiner, will provide us with invaluable insight as we build our presence and commercial leadership in this exciting area of personalized medicine. With that, I will now open the call to your questions. Operator?

(Operator Instructions) Your first question comes from the line of Roberto Fatta. Roberto Fatta – William Blair & Company: Just a question on the diagnostics business and the strategy there. Can we expect additional deals and even the existing deal to lean more towards you guys being a commercialization partner of choice for a company who is looking to commercialize an approved product? Or should we start to think about it more as you guys being an integrated player in the space that will be investing in the development of your own assays?

Yes. Let me say that with Interpace Diagnostics we are headed more towards the integrated molecular diagnostics area. However, we will continue to look at partnership arrangements for companies that need commercial support. I also want to state that our CSO business has a long history and a lot of experience in launching molecular diagnostics and that will continue on a fee-for-service basis. Roberto Fatta – William Blair & Company: Okay, okay. And as you look at the portfolio of products that you acquired today and some of the relationships that you are talking about and the opportunities you are seeing in the future, how do you think this changes your expectations for the timing of a return to profitability?

It will push it out some obviously because we are going to need to invest in these assets as we launch them and/or relaunch them, as anybody would who is in the space where you are commercializing products to physicians. So what we are looking at right now is profitability sometime in a late half of 2016. Roberto Fatta – William Blair & Company: Got it. Okay, thanks very much.

(Operator Instructions) And there are no further questions in queue at this time.

Okay, thank you very much, everyone. And as I said, we expect to continue to keep you updated and we believe that we are on a very exciting path of growth trajectory for PDI and Interpace Diagnostic. Thank you.

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