James L. Herbert - Chairman and Chief Executive Officer Lon M. Bohannon - President and Chief Operating Officer Richard R. Current - Chief Financial Officer

Stephen O'Neil - Hilliard Lyons Anton Brenner - Roth Capital Partners Scott Gleason - Stephens Steven Crowley - Craig-Hallum Capital Group

Welcome to the Neogen Corporation second quarter fiscal year 2009 earnings announcement conference call. (Operator Instructions) For opening remarks and introductions, I would like to turn the conference over to Jim Herbert. James L. Herbert: Good morning and welcome to our regular quarterly conference call for investors and analysts. Today we will be reporting on Neogen’s second quarter that ended on the November 30, 2008. Before starting, I would remind you that some of the statements that are made here today could be termed as forward-looking statements. These forward-looking statements, of course, are subject to certain risks and uncertainties. The actual results, of course, could differ from those that we discuss today. These risks that are associated with our business are covered in part in the Company’s Form 10-K as filed with the Securities and Exchange Commission. In addition to those of you that are joining us today by live telephone conference, I would also welcome those who may be joining by way of simulcast on the World Wide Web. These comments, along with some exhibits, will be available on the Web for approximately 90 days. Following comments this morning, we will entertain questions from participants who are joined by this live telephone conference, and I am joined today by Lon Bohannon, Neogen’s President, and Rick Current, our Chief Financial Officer. Earlier today Neogen issued a press release announcing results of our second quarter that ended on the November 30, 2008. We reported that net income of approximately $3.9 million was a 20% increase over the same quarter last year and a new record for Neogen. On a per-share basis the income for the quarter translated to $0.26 per share as compared to $0.22 a year ago. In the first six months our net income was approximately $7.6 million, or 22% greater than the first half of last year. This translates to $0.51 per share for our current year as compared to $0.42 per share a year ago. The second quarter revenues increased 15% to approximately $31.2 million compared to last year’s $27.2 million. Year-to-date revenues are now running about 20% ahead of last year for that first half and reaching almost $60.0 million. The quarter revenues for this second quarter marked the 67th quarter in the past 72 quarters in which Neogen has shown increases. That’s a record that now spans 18 years. Given the difficult economic climate, frankly, this quarter wasn’t an easy one but I think it does show the operational strength throughout the company and my thanks to the managers and the employees who are responsible for this accomplishment. As I said in this morning’s press release, I believe that our management strategy has been a key to the quarterly performance. As we start off a new calendar year I thought it might be worthwhile this morning to talk a bit about that three-point growth strategy and how we view the future. Our strategy to be the one-stop supplier for both food and animal safety solutions is a sound one and continues to prove that way. Despite these tough times, a number of the markets that we serve have continued to grow. I believe that we have captured our share of that growth and also have made some competitive gains. A second element of our growth strategy has been to grow through the development of new products. During the past year we have approximately doubled the size of our R&D team, hiring 23 new personnel over the past six months. I don't believe that I’ve ever felt more comfortable about the strengths of our R&D group for future growth than I do today. The third element for our growth is through acquisitions. We make acquisitions that fit our overall strategy, we don’t purchase businesses that have a one-time impact on growth. Though we separate organic growth from growth through acquisitions, that comparison, too, can sometimes be blurred. As an example, two of our more recent acquisitions showed growth in the first year, under our management, as compared to the same period under the former owner’s management. So from a technical standpoint a part of what we call growth from acquisitions does have an element of organic growth. These are clearly uncertain times that are ahead of us over the next 12 months. To borrow an old farmer colloquialism, we are truly plowing new ground. We don’t know when or where the plow may strike that next stump, however, I do believe that we have an experienced management team that is positioned to deal with those stumps when they appear. Which, I guess, leads us in to discussing what are we doing to face these economic times and how are we measuring up at the end of this quarter. I think the first thing that is appropriate to look at is cash. We started the quarter off with a little less than $10.0 million in cash and finished with over $13.0 million. Protecting that cash over the past quarter has been the key focus. Our cash is now invested in 89 instruments in U.S. government-insured accounts. This means that our interest rate is a bit lower than a year ago but we didn’t lose any of our principal. We have stepped up our surveillance on accounts receivable and we will continue to watch those closely as we move through these troubled times. Aging of accounts receivable at the end of the quarter was 58 days, which corresponds to the same aging at the end of our last fiscal year on May 31, 2008. Inventory is another area to watch for. Our inventories at the end of the quarter were approximately 11% greater than they were six months ago. Though the 11% compares favorably to a 20% increase in revenues, we still have some inventory positions that are higher than we like to maintain, though frankly, much of this increase was planned. As an example, our inventories in disinfectants and cleaners is about $500,000 higher than it was at the beginning of the quarter. We intentionally built these higher inventories and will likely need to maintain them for most of the rest of this fiscal year due to our strategy of running the business that we acquired from DuPont. We have got 188 registrations in 41 countries that underpin that disinfectant market and as we are orderly moving through those transfers of registration, moving them from DuPont’s ownership to ours, there are a number of countries where we must maintain inventories until we can get the new registrations approved. These inventories also give us some breathing room as we intend to transfer manufacturing from third-party sources for these cleaners and disinfectants to our own facility in Wisconsin. There is a piece of the inventory that is in excess simply because of our inability to forecast demand. As we bring on new customers it is difficult to know exactly what products they might be ordering and in what quantities and we don’t want to backorder a new customer. We have an MRP system that is in place at our Lansing operations and has recently been installed in both Wisconsin and Kentucky and I feel sure that this system will allow us to further reduce certain inventories. One of the unusual situations that has affected inventories during the past eight to ten months has been in the commodities area. Where we found an opportunity to purchase commodity-type products such as casing that’s used in our media manufacturing, or grains that are used in our rodenticide operation, we have brought in some extra inventories to take advantage of price breaks, or in some cases, availability. However, I would say at the same time we have exercised discipline in commodity purchases. As an example, earlier in the year wheat, which is a significant raw material in our rodenticides, was selling in the $12 per bushel range and that’s about double what we had seen in earlier years. Feeling that the market couldn’t sustain these prices, we worked hand-to-mouth for several months instead of booking high-priced commodities. We are now buying that same wheat in the $6 per bushel range. This meant that we didn’t get caught up with a lot of high-priced commodities like a lot of people did that are in the animal-feeding industry. Instead, we are now in a position to book needs for the remainder of this year as prices make that decision more prudent. I will speak a little bit about our international growth. It did have a strong influence on the quarter that we just finished. On a consolidated basis revenue from sources outside of the U.S. for the quarter were 41% as compared to 37% this time a year ago. However, this performance is really better than it might appear on the surface. Remember that we sell product in Euro and pound and real and peso as well as the U.S. dollar. Currency conversions can have a high impact on consolidated statements. As an example, our Neogen Europe operations, when consolidated to U.S. dollars, showed a 2% decrease in revenue for the quarter as compared to last year’s second quarter. In actuality, those revenues, on a pound sterling basis, were up 21%. Of course, this time a year ago we were converting the pound on the basis of approximately US$2.00 whereas this past quarter the conversion rate was at US$1.68. In some cases we have been able to hedge currencies to protect the conversion rate, however, that hedging activity shows up on our statements as other income. Of course, down at the bottom of the statement, and not what I would consider appropriately reflected, is part of the operating profits. In looking at the year ahead, I think the company is positioned to play whatever hand might be dealt us. We know that for some of product offerings customers will have the flexibility to delay purchases, which will have a negative impact on our revenues. However, we believe that we have enough growth opportunities to offset that and to continue to keep the positive, sound growth at both the top and the bottom lines. We also believe that we have enough flexibility to continue the strong performance in operating income. Last quarter was an example, when we were able to actually grow operating income by 22% compared to a 15% growth in revenues. We believe that our strong balance sheet, our cash position may also be advantageous to us as we look at the year ahead. With about $13.0 million in cash, a positive cash flow each month, no bank borrowing, we could see some attractive investment opportunities in the months ahead. Let me stop my comments at this point and turn the call over to Lon Bohannon to give you a bit more insight into how we achieved the results of this past quarter and his outlook for the quarters ahead. Lon M. Bohannon: Let me wish all of our listeners on the conference call, as well as those joining us by Internet access, a happy and prosperous new year. As Jim indicated, Neogen did issue a press release earlier today describing our operating results for the second quarter of our 2009 fiscal year. Neogen’s results for the three months ended November 30, 2008, did set new records for Neogen in terms of sales, operating profits, and earnings per share. And as Jim said, given the difficult economic conditions that exist throughout the world, our outstanding results are a tribute to the commitment and exceptional effort put forth by Neogen’s group of approximately 500 employees, and like Jim I would also like to acknowledge and recognize our employees’ contributions to another great quarter. Jim has already discussed a number of the key performance metrics for Neogen Corporation’s second quarter. The only other item related to our consolidated results that I would point out is that operating income was 18.8% of revenues for the quarter. That compares to 17.6% last year and represents an improvement of 120 basis points. I do believe that this improved operating profit performance is reflective of Neogen’s ability to effectively integrate acquisitions, as well as our ongoing commitment to reduce costs and improve margins, which I will discuss in more detail in a couple of minutes. In terms of divisional performance, the second quarter was another strong quarter for most all of our operating groups. Sales for our Animal Safety Division were up 24% for the quarter and are now up 33% for our first six months compared to the same period last year. Acquisitions have contributed significantly to Animal Safety’s overall growth but we have also experienced some strong organic growth in a number of core product lines, especially during the second quarter. Sales of diagnostic kits used in research applications and revenues from substrates sold to diagnostic kit manufacturers both increased more than 30% in this year’s second quarter. Much of this growth was the result of more products to our existing customer base, including particularly strong growth in sales of our diagnostic test kit for histamine. The increase in sales of veterinary biologics was the largest contributor to organic growth for Animal Safety in the second quarter. Sales of EqStim, and more importantly, our BotVax B vaccine that is used to prevent type B botulism in horses, jumped 61% in the second quarter. Reports of equine botulism outbreaks in Florida, Texas, Hawaii, and some of the New England states, along with expanded domestic distribution of this proprietary vaccine, helped drive the overall growth in sales for this high-margin product. Sales of products aimed at small-companion animals, primarily our care line of products, also saw growth in the second quarter with sales up 26%. This product line is up 49% on a year-to-date basis, led by a significant expansion of private label sales to a large distributor. Other contributors to organic growth for Animal Safety included sales of rodenticides to the domestic market that on a year-to-date basis are now running 8% above last year, and sales of Kane veterinary products that were up 19% in the second quarter compared to the prior year. Food Safety revenue growth, which is all organic, came in at 6% for the second quarter and on a year-to-date basis is up 10% compared to the prior year. However, this same store sales growth is misleading and does not reflect actual unit volume growth achieved by our Food Safety group. Jim already touched upon the currency exchange impact on the reported growth and revenues of our Neogen Europe subsidiary and currency translation also artificially lowered revenues for diary antibiotic test kits. Adjusting for the impact of currency translation in these two areas, Food Safety revenues were up more than 12% for the quarter and are also 12% ahead of prior year for our first six months. I also want to point out that we have increased the selling price of diary antibiotic test kits effective December 1. The price increase was based on a predetermined formula that automatically adjusts prices quarterly based on the value relationship of the dollar and the Euro. And like Animal Safety, the Food Safety group also experienced some exceptional growth across a number of core product lines. Sales of diagnostic test kits for food allergens increased more than 50% in the second quarter and are also running 50% ahead of last year on a year-to-date basis. All seven of our allergen test kits are experiencing good growth led by sales of our milk allergen test kits that are up 80% so far this year. Neogen’s test system, sold under the AccuPoint brand name and widely used for general sanitation applications, had another quarter of strong growth with an overall revenue increase of 14%. A decline in the placement of readers in the quarter, compared to the same period last year, was more than offset by a 23% increase in sales of AccuPoint disposable samplers. And as I discussed last quarter, we are not surprised to see quarter-to-quarter variations in the placement of readers but we do fully expect quarter-to-quarter growth of the disposable samplers that are consumed daily by our customers to monitor general sanitation in their processing facilities. Another area that has achieved exceptional growth in the second quarter was the Soleris product line, used primarily by food producers and processors to detect spoilage organisms in finished products destined for the consumer market. Soleris revenues increased more than 50% for the quarter and that pushed our increase for the first six months of this year to 26%. I think most of you will recall that the unique technology used in Soleris detects general microbial contamination, like yeast and mold, much faster than traditional methods. We continue to uncover numerous prospects for this technology and we are adding to our pipeline of opportunities monthly to help ensure solid revenue growth in the quarters ahead. Before we move on to questions from our callers I do want to take just a couple of moments to elaborate on our efforts to reduce costs and improve margins that I alluded to at the beginning of my comments. I believe Neogen has done a good job of increasing prices and managing costs to improve margins during the first six months of this fiscal year. While it is impossible to provide an exact number for the impact of price increases, I believe we have been successful in implementing price increases that have had a positive impact on sales of approximately 3% in the current fiscal year. I think equally important, we continue to seek improvements in manufacturing systems to improve productivity and are in constant negotiations with vendors to obtain cost reductions or identify alternatives that will lower our overall costs. In addition, because the interest we earn on invested cash is so low in today’s market, we have, on occasion, taken advantage of special offers from vendors to bring in as much as a year’s supply of inventory. I know of one specific example that occurred more than six months ago where we purchased a year’s supply of Kane Nitra gloves to avoid an expected price increase. In fact, the price of these gloves was increased twice within approximately 90 days of the issuance of our purchase order and our vendor went on backorder for these gloves shortly after we received our shipment. We took advantage of this situation to gain market share and as we approach the time to reorder gloves, we are now in a better position to negotiate price due to the dramatic reduction in oil prices in the last four months, which has also brought down the price of petroleum-based products. Now we realize the down side to making some of these buying decisions is that we will periodically have more inventory on hand than we would carry in ordinary economic times. However, in addition to allowing us to lock in favorable pricing on a number of raw material and bi-sale products, maintaining above-normal inventories for certain items has been less expensive than order more often at higher prices and has also saved Neogen significant shipping costs on incoming product. Now I would say that the likelihood of continuing to purchase excess quantities of inventory to gain a favorable price differential declined during our second quarter in the face of the deflationary price pressure we are starting to see in the current economic environment and as a result we are now focusing attention on other ways to reduce costs. For example, the dramatic decrease in oil prices will have a positive impact on our freight costs over the last half of this fiscal year. In addition, we are proactively negotiating costs reductions from vendors who supply us with those petroleum-based products. This is especially true of those vendors who put through significant price increases started approximately a year ago as the price of oil began to sky rocket. And as I have mentioned in a number or previous quarterly conference calls, Neogen will continue to take advantage of existing facilities and manufacturing expertise to bring in-house those products from acquisitions and products currently by third parties whenever it will result in improved margins for the company. Both Animal Safety and Food Safety have programs underway to expand the number of products manufactured within existing facilities that will ultimately result in improved margins for Neogen. In closing, I would say that Neogen is indeed fortunate to be operating in growing markets and to have such a broad portfolio of products that are needed by the industries we serve. There are a lot of opportunities for both Food Safety and Animal Safety as we set our sights on reaching $200.0 million in sales within the next five years. I believe our management team is excited about the opportunities we see, in spite of the current economic difficult conditions, and we expect to continue to report solid top and bottom line growth in the future. That concludes our prepared comments for today and we will now open up the call for questions.

(Operator Instructions) Your first question comes from Stephen O'Neil - Hilliard Lyons. Stephen O'Neil - Hilliard Lyons: On the international sales, Lon, could you indicate how much the dairy antibiotic sales were down in dollars? Lon M. Bohannon: I think in the quarter they were down a little over $0.5 million. Richard R. Current: That’s correct. Because of conversion. Lon M. Bohannon: And actually we did this analysis at the end of the quarter and so far in the quarter, I’m not sure if it was the quarter or a year-to-date basis, but our unit volume shipments are actually up. I know they’re up about 9% for the year. And it’s just not being reflected because of the currency translations, because those are sold in Euros and when they get converted to dollar denominations, that’s where that adjustment comes in. Stephen O'Neil - Hilliard Lyons: What’s that $0.5 million in percentage terms? Lon M. Bohannon: It was down about 20% for the quarter. Stephen O'Neil - Hilliard Lyons: If I heard this correctly, Jim mentioned international sales were 41% of revenue versus 37% last year. James L. Herbert: Correct. Stephen O'Neil - Hilliard Lyons: And so, are there DuPont sales in there? That would imply about 27% growth in international sales, if I have done my math correctly, even with the currency drag. Am I forgetting some DuPont sales in there? Richard R. Current: There’s a significant amount of DuPont sales in the quarter. Stephen O'Neil - Hilliard Lyons: So while Europe was down a little, their antibiotic down 20%, the difference was more than made up by DuPont? Richard R. Current: That would be correct. As well as the growth. Remember, a good deal of our international sales are sold in dollars. Stephen O'Neil - Hilliard Lyons: Also, could you discuss the micro toxin and micro organism testing? Lon M. Bohannon: Our natural toxins is still a big category for Neogen Corporation. It was up about 1% for the quarter, it’s up about 6% on a year-to-date basis. In fact, most of the callers that have listened to these conference calls before realize and understand that that particular category is the one that is most influenced by general overall crop conditions. We did have pockets of problems with DON and aflatoxin and fumonisin but no major outbreaks this year. So actually it’s pretty good to kind of see that number up. The only change from last year, I think last year in the quarter particularly and the first six months of last year, we saw some strong shipments for micro toxin diagnostic test kits to companies that were in the ethanol production business. And I don’t think those sales repeated at the same level this year. It has been a good solid quarter and a good solid first six months for natural toxins. Stephen O'Neil - Hilliard Lyons: And micro organism testing? Lon M. Bohannon: I think up about 5% in the quarter. Similar kinds of things. I think it’s up even more than that on a year-to-date basis, maybe up 8%-9%. Again, just we strive to do a better job there because there are big opportunities in that area. We’re working on some things in our R&D area and we’re working on some improvements in formats and stuff, to give us strong portfolio products there. In the meantime, we continue to grow the business. Stephen O'Neil - Hilliard Lyons: I know there are a lot of products to talk about. I was curious about the veterinary pharmaceuticals and also the veterinary instruments and possibly specialty needles. Lon M. Bohannon: Veterinary instruments were up, and again I didn’t mention, I tend not to mention things that are just in that solid 4% or 5% range, but they continue to grow. We continue to particularly expand our presence in the retail farm store market. I know that our sales to tractor supply, in particular, which people have heard us refer to before, have grown significantly this year compared to last year. And it’s not just veterinary instruments. We are now starting to see the benefit of having that relationship there and starting to get additional shelf space for other veterinary products and fly-control products and even rodenticides, which we have not had before. So that’s going pretty well. OEM and specialty needles, I think they were about flat in the quarter and on a year-to-date basis. Of course, those are unique kinds of relationships with large organizations. Typically we do get some timing differences but we also have got some very nice opportunities there that we are working on that ought to provide some nice support for future growth as we go through this calendar year. Stephen O'Neil - Hilliard Lyons: You mentioned rodenticides were up 8% year-to-date. Did they not do as well in the quarter? Lon M. Bohannon: I don’t know that I have that number specifically for the quarter. I think they’ve been pretty consistent this year. Richard R. Current: They were down slightly. James L. Herbert: Domestically they’re up, internationally they may be off just a little bit because of some big shipments that went out in the first quarter. Stephen O'Neil - Hilliard Lyons: In terms of gross margin, the operating margins are doing very well. The gross margins are running below a year ago. Is that a mix effect or is there some other explanation? Richard R. Current: There are probably a number of things that are in there. There is a mix and also remember that those margins are affected by the accounting for the translation adjustments because it comes out of the sales but not out of the cost and it clearly will reduce those margins.

Your next question comes from Anton Brenner - Roth Capital Partners. Anton Brenner - Roth Capital Partners: You indicated what the revenue effect of currency change was, what was the bottom line income effect? Richard R. Current: That number is a little more difficult to compute than is the top one. My best estimate on operating margin is $375,000. Anton Brenner - Roth Capital Partners: On operating income? Richard R. Current: Operating income. Now we get part of that back, at least a couple of hundred thousand of it back, in other income. So the total effect on the bottom line is probably closer to $200,000. James L. Herbert: We’ve been hedging the Euro all along and it has been a smart move. Typically, the first month or two we might have been behind a little bit. Of course, that’s why you hedge. You hedge to tie in the price you want, not to be a speculator. But our hedging has worked well for us as we’ve seen moves in the currency. But the hedging opportunities began to play out at the end of this quarter. And all we’ve been hedging is the Euro. We are now hedging both Euro and real because we have enough real out there because of our Brazilian business, we’ve begun to hedge the real, too. But there’s just not a good way to hedge what’s happening in the pound sterling as it relates to pound sterling conversion to the U.S. dollar or as it relates to the pound sterling conversion to Euro, remembering that our European operations report on pound sterling but they sell a lot of product in Euro. So, we’re almost beginning to see parity with pound sterling and Euro being paritied when compared to the dollar. So it’s kind of an unusual situation going on over there. But the business is good and it’s healthy but it’s just the comparison from this year to last year that sometimes distorts it a bit. Anton Brenner - Roth Capital Partners: Just looking at the third quarter, the pound is at least to date remained quite low, but the Euro has rebounded to above where it was a year ago. James L. Herbert: That’s correct. Anton Brenner - Roth Capital Partners: So does that mean, given that you’re hedged on the Euro, not on the pound, that the negative effect on sales might be even a little greater this quarter? Richard R. Current: On the sterling, we will probably have an equivalent negative effect, assuming that all things remain equal going forward in the third quarter. That will be a tough comparison. I think we’re okay on the Euro, both compared to the prior year and with where we sit on our hedging strategy in the third quarter. James L. Herbert: Of course it moves from day to day, but as I remember, Rick and I looked at it on Friday, our Euro was hedged just a little better than the spot market that day. Richard R. Current: About 139. Anton Brenner - Roth Capital Partners: That’s pretty close. One other point. Your latest take on BetaStar? James L. Herbert: Well, one of these days I may write a book on the efficiency of government based on this one. Those of you who have been following this and asking the questions I’m sure along the way are wondering if they’ve got a problem they’re not disclosing. I can again say that’s not the issue, it’s just the efficiency of government. Back last March, after doing a good bit of work, we did get what was the final acid test on the use of our BetaStar milk antibiotic test, its performance, in order to be able to use that in the U.S. market. None of our current sales of that product are in the U.S. market, they’re outside. And the product continues to do well and continues to grow. So that would have normally been, once the approval by the Association of Analytical Chemists was done, that would have been the end of it because they work with a memorandum of understanding with the FDA. Well, it went over then to the FDA and the Center for Veterinary Medicine and the FDA took a look at all of it, had a few questions, asked us to reword some of the product inserts. At the end of August they approved it. So we started telling you all that it was just around the corner. So then it went over from the FDA to the National Conference on Interstate Milk Shippers because they get an opportunity to look at whatever FDA has approved and their lab committee looked at it and the 21st of October they got around to having a meeting and approving it and they sent it off to their executive committee to sign their approval. And the executive committee signed it on November 4th and we said this is it, the only thing it has to do now is the FDA has got to write a little simple memorandum and issue to the industry. Well, November 4th kind of coincided with the expected change of the guard, I guess, in Washington and the FDA, we finally got word out of them on December 16th that everybody was sick, on leave or whatever, and they didn’t expect to get to it until the first of January. The word yesterday was that they reviewing it, they thought that there was not problem, that they just were short-handed and somebody would get what I guess is a one-page memorandum out and they had a big meeting going on this week, the week of January 5th. So it’s just waiting the final memorandum from somebody at the FDA and I’ve quit predicting how long that takes. Sometimes you call them every day and that just sets up a block, they’ll just show you that they don’t have to do it. Or if you don’t do it often enough then they lose it in the pile. So I don’t know what the right approach is. But clearly it’s a good product. It’s clearly approved and there is some demand for it because some people in the U.S., U.S. milk processors already know that the product is out there. We do business with a lot of those milk processors today with products other than the milk antibiotic test. So, once we get released, which surely to God will be this month, then we ought to be able to begin to see some revenues. We do have product built. That product is in inventory. It’s not a dating problem, it’s not perishable, it’s not anything we’re going to throw away. But we’re ready to go.

Your next question comes from Scott Gleason - Stephens. Scott Gleason - Stephens: First question. Food production is clearly a very defensive industry but probably not perfectly defensive, as an industry is. Can you give us some granularity as looking forward what to expect in terms of organic growth in 2009 and what your kind of assessment of what we could likely see is? James L. Herbert: As I said in my comments earlier, it really is a lot like plowing new ground. We don’t know where the stumps are going to be. I think we know how to get around them. But you take, for instance, a company like Tyson Foods and what’s happening there. Those customers like that, or companies like that, are big customers of ours. And Pilgrim, who’s down the road apiece. They, too, are in pretty bad financial straits. It’s kind of unusual Tyson didn’t notice it. Their president stepped down yesterday and they brought in a guy I know, who is an extraordinarily good manager, Leland Tollett, who has been away from the business for a lot of years. Now I’m sure he’s probably got as much energy as I do so I’m sure he will be plenty capable of coming back. But there are all those kinds of things that are going on, they’re closing down plants or trying to decide how to get more efficient during these times. That will have some impact on our sales. If Pilgrim shuts down one or two of ten plants, and those two plants were using our product, that will reduce the amount of business we have. I think we’re picking up enough other business, as I see us bringing on new customers, to more than offset the kind of things we’re going to find there, but my crystal ball is just not good enough to be able to predict exactly what’s going on. Scott Gleason - Stephens: Is it safe to say maybe that kind of the low teens-type organic growth rate you saw in 2007 maybe it would be safer to assume kind of high single digits for 2009? James L. Herbert: We’re talking about calendar 2009. I think that’s right. And we have got a couple of acquisitions that are now over in the organic growth area. They’ve been on board for more than a year so they’re not considered to be growth through acquisitions now because they’re comparing year-to-year, the same apples-to-apples comparison. The DuPont thing continues to look good. We have had that business on board now for seven months. We see all kinds of opportunities for expansion there. A big part of it is outside of the U.S. and it takes a little longer to get it done in Costa Rica than it does in Georgia, but that’s 41 countries where we’ve got some of them access for the first time, really good distribution access. We see that coming along. Through the first seven months, I was looking at it last night, saying how did we do in our pro forma and forecasting that business because as in any acquisition, there are a lot of unknowns as we brought it on board. Through the first seven months the actual performance, in terms of revenues, were within about 1.5% of what we thought they were going to be. So there are no real surprises there, whether negative surprises or offsetting positive ones. So, I think that will continue to help us as we look forward over the next 12 months. Scott Gleason - Stephens: And then could you potentially give us a little more color from an acquisition standpoint of your assessment of what the current pipeline looks like? And maybe talk about your appetite to take on a little bit larger deals in terms of deal size? James L. Herbert: We would welcome doing bigger deals. We have typically been doing things that are in the $5.0 million to $8.0 million revenue and we would like to step up to something bigger. It’s just the availability of finding it. We’ve got one or two that we’ve spotted but they’re either not a real good fit or there is probably no interest on the other side, in a courtship. But with our line of credit that’s available to us, actually we’ve got a lot more borrowing capacity than we do actually in an available line of credit today, I think we have the capability of stepping up. I think we’re in a position to get bank money. We haven’t tried to get any lately but they’ve got to loan it somebody and I don’t know that anybody is any more credit worthy than we are out there today. So I think we could get the money to step up to something bigger. We just haven’t seen anything that fits there. We do have a couple of areas that we’re looking at. None of them real big and nothing near any point of a letter of intent yet. But I think, especially in private companies, as they’re looking at what they might do to get liquidity, there’s concern about what the current administration may do in the way of taxes. That’s still fanning some flames out there, it has some interest that might not otherwise be there as people might be looking at liquidity. And then I just think there is also that concern of some people who are not as fortunate as we are to be carrying big bank balances and to have the monthly positive cash flows that are wondering what might happen when their note comes up at the bank. So we think that we’re in the best position to do some acquisitions. We’re also in a better position to do some things in Europe. We backed out of Europe for most of the last couple of years when the pound and Euro reversed on us. It didn’t make any sense to use U.S. dollars to buy pound-denominated opportunities. That, of course, is looking better than it was, from $1.58 down to $1.32 or wherever it is today. Those opportunities look better. Plus, Europe is facing its share of financial difficulties, too, so there could be some opportunities for us there in some areas that we would have liked to have done something in over the course of the last couple of years.

Your next question comes from Steven Crowley - Craig-Hallum Capital Group. Steven Crowley - Craig-Hallum Capital Group: On DuPont, you mentioned that the business so far has performed pretty consistent with your expectations. I know you have an ambitious plan and a compelling plan to bring the manufacturing of that product into your own manufacturing and further drive the profit contribution from that business. Can you give us an update on the time table and how you’re sizing up that challenge? James L. Herbert: This is, again, an issue that is not really based on anything we can do directly, it’s based on registrations. In order to be able to shift a manufacturing site, in many countries you have to file a registration with that company or an alternate manufacturing site. And until that registration is approved in that country you can’t move it from its current manufacturing site. We are right now manufacturing a fair amount of stuff in the U.K. that was being manufactured there at the time we acquired the business. Our [toll] manufacture in the U.K. has told us that they would like to be out of manufacturing our products because they know they’re going to lose that business and they would like to be out of that by the end of February. We would extend it longer if we just absolutely needed to do it. So that portion of our business is one of the things I mentioned in my prepared comments is causing us to carry higher inventories than we might normally because we have got to get all of the registrations done for a change of alternate manufacturing site and move it to Randolph. That product will begin to manufacture in Randolph but where we may start manufacturing in Randolph, say in April, if we’ve got a country where we don’t expect to get an approval on the alternate manufacturing site until May or June, we’ve got to keep enough inventory from the U.K. operation to continue to sell in there and so our distributor doesn’t run out of stock. So it’s a maze. We’ve got two good people that are spending full time working on registrations and they know what they’re doing, it’s just a maze of getting through all those. It’s also a good barrier to entry. No everybody has got the capability or the guts or the lack of sense or whatever to go through trying to do all those things. Steven Crowley - Craig-Hallum Capital Group: And in terms of the potential pay-off from moving that into your own manufacturing, has much changed in terms of your expectation there? James L. Herbert: No. I would say that I think there’s probably 12% to 13% improvement in cost of goods. I think Lon and Rick would not be quite so optimistic as that because I’m still typically a crazy optimist at times. But there is clearly some opportunity for us to do that. A lot of the fixed stuff is already in place. Steven Crowley - Craig-Hallum Capital Group: In terms of the sales synergies, you anticipated with bundling these newer disinfectants with the rest of your supply product line to the larger producers, how does that look from your current vantage point? James L. Herbert: We are already beginning to see, particularly within the large animal, what we call integrated market, where before we might have had some rodenticide sales but not disinfectant sales, we are now able to bring disinfectants in, whereas maybe DuPont had some disinfectant sales into that company but we didn’t have rodenticide sales where now we’ve been able to hook rodenticides to it. So I think the story is beginning to materialize. Steven Crowley - Craig-Hallum Capital Group: And then to pick up on a couple of the other bright spots that you mentioned in your press release. Soleris and the success you had in the quarter, was that driven by any new sizeable applications or major customers that have on-stream? Lon M. Bohannon: Since we acquired that product line, I guess it goes back almost two years now, we have seen broad-base growth opportunities in a number of markets. It’s not unique to any particular market. We have had particularly good strength in the nutraceutical market for the placement of instruments, but there are a lot of other opportunities for that particular technology where there is an economic value to not having to hold inventory for as long as needed because you can detect these spoilage organisms much faster with this Soleris instrument and the disposable vials that we sell to it. We had a kind of a blip in our first quarter in terms of the placement of instruments, but we have worked very hard to rebuild the pipeline there and it’s hard not to be overly optimistic in that particular category going forward. That’s one area that it’s just difficult for us to predict what the impact of the economy might have. Not from the standpoint of the opportunities and the need for the technology, but from the standpoint that there is a capital expenditure associated with this and whether or not some of those might be deferred or moved out because of the economic conditions. Now, to counteract that, we are also taking a look at ways that we can utilize rental reagent agreements with that instrument to get some of those placed. A lot of those we find subsequently get converted to sales, and of course, when we can get them out there and get them in use, then the vial usage goes up and that supports month-to-month growth. So we are excited about that product line and there are opportunities in a lot of different markets. The beverage markets, and things like spices and other condiments, and even into other areas that we can expand into going forward. James L. Herbert: And we’re continuing to develop new products through R&D that fit onto that same platform. As Lon said, what really drives that business is the razor blade business and that’s the vials that are tailored to find certain organisms within certain matrices and we are looking at the R&D section, as a part of what they’re doing in that section of our R&D group. And I think they’ve got either three or four new products that will fit on that same platform that are somewhere in the development pipeline, anywhere from a month to six months out. So some of that has also come into play here over the past six months. Steven Crowley - Craig-Hallum Capital Group: I have a similar question about the ongoing success you’re having with AccuPoint. It seems like this quarter with the preponderance of your success being on the disposable sensors versus not a new reader placements, the conclusion I jump to is that you are having good success further penetrating existing customers and their applications rather than breaking into some new green field territory. Lon M. Bohannon: I would say that we’re very optimistic about other opportunities to place instruments as well. I just think when you’re talking about some of those kinds of expenditures it’s hard to look at just one single quarter and draw a lot of conclusions. There are still a lot of good opportunities out there for placement of instruments with new customers. We actually already, in this month, have seen another placement internationally, it looks like a good sale. I think that that also gets back a little bit to this organic growth, to follow up on some of the things that Jim said. One thing that I am encouraged about is that the monthly meetings, we’re still seeing a lot of very good prospects and opportunities across a number of product lines for both Food Safety and Animal Safety and I think when you combine that with the efforts we’ve got going in on R&D to develop new products for some of these markets, that at least from a unit volume standpoint, we can continue to look at some solid organic growth in this calendar year. Steven Crowley - Craig-Hallum Capital Group: You mentioned a significant increase in resources in R&D. Have we seen the majority of that cost increase on your income statement? Or the way I have in models is it continues to show up more in Q3 with a run rate in R&D of around $1.5 million a quarter. What is the right way for us to think about the cost ramp as you’ve done the people ramp? James L. Herbert: The people have been added on sequentially, they didn’t all get added on the first June so we’ve been continuing to hire. I indicated that we had brought 23 people on since probably last May, I guess is when we started that. And some of them have come on board as late as last month. So you’ve got a big part of R&D is expense of personnel, salary expenses. But at the same time, every time you put a scientist in the lab there are a certain amount of supplies that go with it. So those haven’t ramped up yet, even though some of the salaries are in they have not been fully productive enough to be chewing up a lot of lab supplies yet. We ought to be leveled out probably where we’re going to be running in Q3, as far as total cost. Steven Crowley - Craig-Hallum Capital Group: And are you still looking to bring on a leader to that organization versus the current interim leader of that organization? James L. Herbert: Are you trying to get me out of a job? We are continuing to add senior people as the organization gets larger. There are those of us who have been managing those kinds of things have less and less time to manage it. That’s part of the strengthening of the overall program that we’re doing. But they’re very successful now; they’re very productive now. But if we’re going to continue to produce going forward and push, we’ve got a goal as to how many new products we need to push out of the pipeline in both Food Safety and Animal Safety on an annual basis and we’ve got to ride herd on that and make sure that these new resources that we’re putting in place truly are productive. I’ve got a lot of confidence in the leaders that are running the various groups today. And we need to step up some on what we’re doing on Animal Safety. We’ve not spent as much resources on new product development in Animal Safety as we might and as I would expect we would as we move forward, even through the rest of this fiscal year.

Your next question is a follow-up from Stephen O'Neil - Hilliard Lyons. Stephen O'Neil - Hilliard Lyons: Can you tell me what the incremental impact of acquisitions amounted to in the quarter? Richard R. Current: In dollars, $2.75 million.

At this time there are no further questions. James L. Herbert: Thank you. During the past year Neogen was named, as most of you know, a part of the Russell 2000 Index. I asked Rick Current yesterday if this was truly a market distinction, as we looked back over the past year. He came back saying as a youngster he had learned that making a C in school couldn’t be explained away by reminding his folks that other people made Ds and Fs but that maybe in the stock market it was appropriate to look at price performance as it compared to the overall market. And I thought you would be interested in those finding. When you compare Neogen to the Russell 2000, for the past year, and that would be through yesterday’s market, Neogen stock was down 2% versus the Russell 2000 suffering a collapse of 34%. I looked further back to see how we were doing compared to the Russell for the past two years and found that Neogen was actually up 76% while the Russell Index was still down 36%. And then looking even further back, over the past five years, during that period of time, compared to yesterday’s close, Neogen stock is up 97% while the Russell Index was still down 11%. So, I guess I say to each of you here and others, our thanks to all of you that have placed your confidence in Neogen and its management team over the past few years and let me assure that we will keep our head down and we will continue to work on those things that we can do something about and we will continue to strive to give you this kind of above-average return on your investment going forward.

This concludes today’s conference call.