Thank you, and thank you, for joining us for Exact Sciences' Fourth Quarter 2011 Conference Call. On the call today are Kevin Conroy, the Company's President and Chief Executive Officer; and Maneesh Arora, the Chief Operating Officer and Chief Financial Officer.

Exact Sciences issued a news release earlier this morning detailing our fourth quarter 2011 financial results. If you have not seen it, please go to our website at exactsciences.com or call (608) 284-5735 and it will be provided to you.

Following the Safe Harbor statement, Maneesh will provide a summary of our fourth quarter and full year financial results. Next, Kevin will review our 2011 accomplishments and 2012 priorities.

one, speak only as of the date made; two, are subject to inherent risks and uncertainties, including those described in our most recently filed annual report on Form 10-K and our subsequently filed quarterly reports on Form 10-Q; and three, should not be unduly relied upon. Except as otherwise required by the Federal Securities law, we disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein or elsewhere to reflect any change in our expectations with regard thereto to any change in events, conditions or circumstances on which any such statement is based.

It is now my pleasure to introduce our Chief Operating Officer and Chief Financial Officer, Maneesh Arora.

Thank you, Cara, and good morning, everyone. During 2011, we made significant investments in the company's most important priority the DeeP-C clinical trial for our Cologuard cleaning -- screening product.

Enrollment for the DeeP-C trial remains on track. We made these investments in the trial while carefully managing our cash and meeting our 2011 cash utilization target.

We met that guidance even after pulling forward our automation program, which Kevin will discuss in a moment.

We ended 2011 with a cash balance of over $93 million. We expect to utilize between $36 million and $39 million during 2012.

The increase from our 2011 cash utilization will be driven mainly by an increase in clinical trial costs. Our base cash utilization will be slightly higher in 2012 than it was in 2011.

We expect the total cost of the DeeP-C trial to be approximately $25 million, as we have guided previously.

It's now my pleasure to introduce Exact's President and CEO, Kevin Conroy.

Thanks, Maneesh. Before reviewing our accomplishments in 2011, I want to congratulate Maneesh and his promotion to Chief Operating Officer.

Maneesh is an invaluable partner and it is great to have him providing leadership to several of the company's most important initiatives, including the DeeP-C clinical trial.

I would also like to welcome Laura Stoltenberg, who will join the company as Chief Commercial Officer in March. Laura joined Exact from GE Healthcare Lunar, which she was Vice President and General Manager of that global business.

In addition to her leadership at Lunar, she has extensive sales, marketing, business development and general management experience at GE Healthcare. She's a great addition to our team as we move towards FDA submission and beyond.

In 2011, we enhanced the performance of the product as can be seen in the November 2011 validation study. Importantly, we achieved agreement with FDA and CMS on our clinical study protocol, and we initiated the study slightly ahead of our internal plan.

There were 3 key publications, scientific and medical publications, that were published, that are actually published in February of this year. And importantly, we exceeded our internal enrollment target for the DeeP-C study.

Let's turn to an important peer-reviewed publication that featured our sDNA prototype test. We are very pleased to have our colorectal cancer screening test featured on the cover of Gastroenterology, a premier peer-review publication in the field.

The cover article detailed the results of the training and test sets from the case-control study we conducted in late 2010. Gastroenterology is a prominent journal in the field of GI disease, ranked first of 71 journals in its category.

It reaches GIs in the United States and around the world. Selection as the cover article underscores the importance of the underlying data.

One of the most interesting findings of the study published in Gastroenterology was the ability of our test to detect both left-sided and right-sided pre-cancers and cancers. Pre-cancers and cancers in the right side of the colon had been more difficult to detect with traditional methods, including optical colonoscopy, than those in the left colon.

Data published in Gastroenterology demonstrate that our test identified pre-cancers and cancers on both the left and right sides equally well.

Our test has also appeared in 2 other key publications recently. First, a peer-reviewed article in the journal Clinical Gastroenterology and Hepatology that appeared online last fall reported the results of the study that compared the ability of our test with Septin 9 in the detection of large adenomas and cancers.

The results were striking. In this study, our test demonstrated a pre-cancer sensitivity of 82%, while the Septin 9 assay method sensitivity was only 14%.

Our sDNA test identified 87% of colorectal cancers. The Septin 9 assay detected only 60% of cancers.

The false positive rates were 7% for our test and 27% for Septin 9.

Second, there was a review article published earlier this month in the journal Pathology. It highlighted the outstanding performance of the sDNA-based approach and the recent technical advances we have made with our test.

These advances, the article says, are making possible high detection rates of critical target lesions, curable-stage colorectal cancer and pre-cancers at the greatest risk of progression.

Let's discuss 2 articles that appeared in today's New England Journal of Medicine and as a cover story in today's New York Times. In the first study by Zauber et al, it showed a 53% mortality reduction after pre-cancers polyp removal.

In the second study, which was a Spanish study, it shows that colonoscopy detects nearly twice the rate of pre-cancerous polyps as the FIT test. The non-invasive FIT test compliance is higher though than colonoscopy at 34% compared to 25% for colonoscopy.

The key take away from the first study is that this is proof that removing advanced adenomas, or these pre-cancerous polyps, decreases the mortality rate. The key takeaways from the second study are that colonoscopy, which is a test that detects pre-cancers, detects it at twice the rate of FIT.

But, despite that fact, more people prefer the FIT test. We believe that a stool DNA test, which is both patient-friendly and detects a high rate of disease is a near-ideal test.

A stool DNA test is non-invasive and comes close to this ideal because it's non-invasive, there's no bowel prep. It's very easy for patients.

It's accessible, it's affordable. There are no dietary or medication restrictions.

Patients don't miss work. The kit and sample can be sent through the mail.

The test has extraordinary sensitivity for pre-cancers and cancers. And the diseased site within the colon makes no difference in the detection rate.

So we think the New England Journal study is really important. And the goal here, and it's a really important goal, is overall, is to increase the detection of pre-cancers and to increase compliance whatever that test method may be.

Taking a closer look at our -- at the performance of our test. Enhancing the performance of our test was one of the key accomplishments during 2011.

The study results published in Gastroenterology were generated from a prototype test. We believe we can improve that test performance, and we did.

Last November, at AMP, the Annual Meeting of the Association of Molecular Pathology, we presented the positive results of the second study, which provided data from the fully optimized Cologuard guard test that will be used in the clinical trial. It included our final marker panel configuration.

The results were very promising, with significant performance improvement, 98% cancer sensitivity, 59% pre-cancer sensitivity and 91% specificity. Our R&D team did an outstanding job of identifying ways to improve our test, and their hard work throughout 2011 can be seen in this data.

We've also made great progress on our automation solution during 2011. As Maneesh said, we were able to pull our automation program forward in 2011, and it remains on track.

Our automation solution performs DNA extraction, bisulfite conversion, which is critical for methylation detection, and plate set up for both incubation and detection. It makes patient sample processing simple and lab-friendly.

After software validation, instruments will be installed for sample processing at 3 clinical labs that will be conducting all the testing for the DeeP-C study. Kudos to the instrument team for their unbelievable work in developing this instrument and keeping it on track in preparation for the clinical trial.

Let's turn now to an update on our clinical trial. We currently have 59 clinical sites enrolling patients across the country.

There are an additional 20 sites that would have been initiated -- that will initiate enrollment by the end of the first quarter, bringing our total to nearly 80 sites. We increased the number of sites because we reached our site enrollment goal faster than expected and wish to bring more sites into the DeeP-C study to ensure a high level of enrollment.

Overall patient enrollment for the study is on track. The observed cancer incidence in our patient population is also on track.

Let me restate that. The observed cancer incidence in our patient population also is on track.

The number of cancer patients determines the total number of patients we need for the study and it determines when we complete the study. We are confident in our ability to complete enrollment for our previous guidance.

Now let's -- well let's go through that quickly here. After good discussions with the FDA, we anticipate moving forward with a modular submission and review of our PMA application.

A modular approach allows us to submit and be reviewed by the FDA on a rolling basis. We continue to expect that trial enrollment will be completed during the third quarter of 2012.

We plan to announce the results of the DeeP-C study in a scientific forum during the fourth quarter. Our first modules will be submitted during the fourth quarter as well.

Because of the logistics of a large trial like ours and the 60-day interval required by the FDA between submission of each module, we plan to submit our final module, the clinical module, in early 2013.

one, preparing and submitting our PMA application; two, being prepared from a manufacturing standpoint; and three, developing the market for Cologuard.

We have just discussed our FDA submission in detail. Our manufacturing goals include having in place a fully implemented quality system and the ability to manufacture and ship reagents to customers.

And this is a significant undertaking, and we have a tremendous team in place to achieve our goals.

Our market development priorities include completing a health care economic study, showing cost effectiveness for our test; preparing a CMS national coverage application; engaging target primary care physician groups and gastroenterology societies and payers; submitting 2 to 3 new scientific and medical publications; completing our product pipeline plan; and also initiating the CE mark process in developing a pilot EU launch plan.

In conclusion, our DeeP-C clinical trial enrollment is on track. We've seen very strong performance with the final version of our test.

We welcome Laura Stoltenberg as Chief Commercial Officer. We plan to complete our DeeP-C study and submit to the FDA in 2012.

And most importantly, this test, Cologuard, addresses a significant clinical need and represents a large global market opportunity.

Thank you, and we'll be happy to take your questions.

This is actually Matt in for Quintin. Really quick, thanks for the update on the clinical trial, wanted to just dive in a little bit and see.

I think in the past we had talked a little bit about that cancers being about a handful per month as that trial goes forward. You had said that was -- it was on track, just wondering if there's any additional color there?

Yes, so additional color around enrollment. As we started the trial, we saw sites enrolling younger patients.

As you are probably aware, one of the restrictions in the study is that patients have to be at average risk for colon cancer. That means that they can't have had an either positive or negative colonoscopy in the last 9 years.

If they've had a positive colonoscopy, then they're at higher risk for disease. And if they've had a negative colonoscopy, they're at low risk for disease.

In patients age 50 to 65, those patients would have been easier to enroll. And initially, the sites enrolled a lot of them, a high proportion of younger patients.

As you may also know, one of our goals in the study is to power the study in a sufficient way that the Medicare populations well-represented the over 60 -- the 65 and older group. And what we saw was a majority of patients being younger early on, and now we are shifting to older patients who are a little bit harder to find that haven't had a colonoscopy in the last 9 years.

The disease rate is also higher in the older population because the incidence rate for colon cancer increases significantly between age 60 and 65. Despite the fact that we enrolled younger patients in the early part of the study, we are slightly ahead of pace with the overall cancer accrual rate.

That means that we are seeing an appropriate level of cancer incidence in the overall population. As we progress, we expect to see older patients in the study, and so that gives us a lot of confidence that we'll complete the study on time.

And again, the study is driven by the total number of cancers detected in the screening study, not by the total number of patients.

Got it. And then just as a follow-up, kind of on that priorities slide that you've put up for 2012, just kind of wondering if there's any color at this point on pipeline?

Or is that something we should stay tuned for kind of over the course of the year?

We have some real interesting product extensions and new products, but we won't be talking about them and it's not our primary priority. So we won't be talking about them until later this year.

Couple of questions, just to follow up on the last question, I just wanted to confirm here. So if you were able to pick up the number of cancers that you need for the study but you were doing it primarily in -- those patients who are primarily in the younger population, would you stop the study at that point?

Or would you keep it going in order to get enough Medicare patients to satisfy CMS?

We don't think that it's going to be a problem given -- of course, we don't see this data first hand. An outside party reviews all of the case report forms and just provides high-level data to the company so that the blind can be preserved.

But we don't think it will be a problem to have the appropriate or the target level of enrollment in the 65 and older group. We will stop the study, we'll have to make the decision, but the goal now is to stop the study with 56 cancer patients in it and do the testing in the probably late in the third quarter of this year.

Okay. And then on the commercialization a little bit here, you've obviously hired some precious talent to start to think about that.

Should we think about you guys starting to hire people towards the end of -- I mean, at what point will we see other people kind of being hired to fill up the commercial organization. Could we look for you guys to do some sort of an acquisition to maybe bring in a group that is selling some other product?

How do you think that's all going to take place?

Well, as you know, Brian, we really -- we'll end up marketing to GIs who will be important influencers as large group practices, mandate screening and include stool DNA testing as one of the option. So you have to market to the GIs.

But ultimately, it's primary care physicians who will order the test or recommend the test to patients. So we do need to have a very talented group of individuals that market to GIs, and we'll take a look at many different options that we have in fulfilling that need.

In terms of the timing of hiring, a lot of that will be driven by the clinical trial progress that we make. And should we remain on track probably late this year and then more so as we move into 2013, we would start to invest more in sales and marketing.

It's actually Dave Clair here for Bill. So just got a couple of quick ones for you guys.

Just curious if we should be looking for anything in terms of near-term milestones, any additional data publications we should be looking for?

As we've talked about another study that we expect to conduct this year, we have not provided guidance around when we will do that study. But suffice it to say that it will be in advance of the completion of enrollment of the DeeP-C study.

The goal of this next study is to further validate the test in patients who have been enrolled in a prospective fashion like the DeeP-C study. And those samples have been already collected.

And those samples are banked, and they include significant number of patients without disease or patients who have been scoped and came back negative, and also a good number of patients with pre-cancers. So stay tuned.

The results of that study we will announce in an appropriate forum, and we look forward to conducting that study and sharing the results.

Okay. And just a quick one on the R&D spend, is this kind of a level we should think of through 2013?

Dave, if you think about the guidance we provided and you think about the cash utilization in 2011, the direct increase is all going to be in R&D. So if you look at the P&L, you'll see a modest uptick in the infrastructure G&A, a modest uptick in sales and marketing, but the rest of the increase is essentially all driven by clinical trial expense.

If you remember, last year was really a half year, and this year will be a full year including the submission.

So Maneesh, just to follow up on that last one. How much of the $25 million have you already spent at this point?

Is it just a couple of million bucks, just taking the run rate as of, let's call it, the second quarter moving to the second half run rate? Is that different to basically what you spent on the clinical trial?

I wouldn't look it exactly that way. There was an uptick in Q4.

But of the total $25 million, approximately $8 million in 2011 was the DeeP-C trial.

Okay, $8 million. And you don't -- we should model the sales and marketing line basically around $1 million or so a quarter until you enter into 2013.

Is that an accurate statement?

That's probably a decent place to be.

Okay. And then, Kevin, any updated views you have on potential partnerships, commercialization partnerships, as you guys are kind of setting up the marketing plan either with pharma- or lab-based institutions?

Just any color you can offer there would be great.

Sure. The most important way to think about how we will commercialize this test is there's a huge opportunity as physicians move to group practices, particularly as primary care physicians move to group practices.

GSK's CEO just highlighted this, that they see that 60% to 70% of all doctors, by 2014, will be employed by group practices. The one great thing about group practices for cancer screening is they set their -- they set guidelines.

They look to the American Cancer Society guidelines and GI Society guidelines, and they take all of that great information and they set their own internal guidelines. So we need to be successful.

We don't have to go to 300,000 or 400,000 primary care physicians and convert them one by one. You need to make the argument that adding stool DNA as an alternative screening tool is a tool that will increase compliance and pre-cancer detection capabilities.

And you do that at the institution level, which requires buy-in of GIs, and that's important. So you need to be able to influence the GIs because the GIs will have a say in any changes to colon cancer screening guidelines within the institution.

And then you need to be able to educate in detail and support primary care physicians as they offer this test to their patients. In terms of lab partnerships, we think that if you take a look, there are hundreds of molecular diagnostic labs in the United States.

And we have made this test easy enough for those labs to utilize this test, including the labs at those very same institutions that we expect will adopt our test. So this is -- can become a decentralized test immediately, and we won't be beholden to any single large lab.

With that said, certainly the large national reference labs are labs that will be important to us over the long haul. I know that doesn't answer all of your questions, but I guess I would finally say, we will do everything we can to preserve the value that we think this test provides both within the U.S.

and globally. So a pure -- any form of distribution partnership that takes value away from shareholders, we would be very careful about.

That's great. That's good color.

And then finally, you talked about the modular approach, and I think you've kind of called out or implied to 2 modules. Is that the final number of modules you expect -- 2?

Or will there be more than just the initial one in 4Q '12 and, I guess, the final in 1Q '13?

It's a good question. There are 3 modules in any PMA submission.

The first is a manufacturing submission. And that goes off to a group that eventually comes in and inspect your facility and all of your quality records and your quality system.

Second, there's an analytical module. And that is the data from the results of hundreds of analytical side studies that are required to show that the performance of the test analytically is up to snuff.

And then finally, there's the clinical module, which is basically the data and all the data tables from the DeeP-C study. So those are 3 separate modules.

The analytical and the clinical sections are focused on by the review team in an intensive way and ultimately by a panel.

Okay. So the first one is the manufacturing submission and that goes in the fourth quarter of '12 or we might hear it soon [ph].

So right now we expect early in the fourth quarter in '12 to have the manufacturing submission -- the manufacturing module. Late in the fourth quarter, the analytical submission, and then early in Q1 2013 the clinical module of the submission.

I was just wondering, Kevin, what you see on the competitive landscape, it doesn't really look like anyone's making any progress from what I can tell. Can you comment on that?

Sure. We have said this consistently, and I'll take you back 3 years ago, when Maneesh and I joined the company, the first thing we did is look at a blood-based test.

And all of the data that is available, we pored over, we talked to the best researchers, scientists and GIs in the field and they all consistently said, "Look, if you want to make an impact on the incidence rate and the mortality rate, you need to have a test that detects pre-cancers." That's one of the reasons why the New England Journal publication today was -- it was validating.

And if you take a look at the performance of the test of the various companies that have been trying to detect colon cancer out of blood, they suffer from the problem that they, first of all, don't detect pre-cancers. Second of all, their cancer detection rate is low, especially in stage 1 cancers.

And thirdly, the false positive rate is really high. And I'll give you an example, there was a note that came out some place this week that GNU's [ph] test secured approval from New York State, which means that New York State has analytically looked at this test and it performs as it analytically should.

But clinically, there was a paper published in the International Journal of Cancer in 2009 that showed that that test has a 71% sensitivity for cancer and a -- I'm sorry, a 72% sensitivity and a 70% specificity. That means that, that test has about a 1% positive predictive value.

That means that 99 out of every 100 positive test results is a false positive. These are tests that actually would drive up the cost of colonoscopy and send over-referred patients to colonoscopy on an annual basis.

30% of all the patients who got that test would end up being referred to colonoscopy. These tests don't work in an era where you actually need to reduce costs and increase prevention.

That test wouldn't do anything to prevent cancer, but it would significantly increase costs. And we think, ultimately, it wouldn't be adopted or paid for in a meaningful way.

So that's where we are in terms from a competition standpoint. We have very strong IP around extracting DNA from stool and detecting colon cancer and pre-cancer in stool.

And we think that IP is really solid. And we think we're in a strong position to carve out a long-term leadership position in this field.

My question is along the lines of the regulatory and reimbursement review. I'm wondering, if you could discuss some of the potential positives, but also the challenges that you see in the parallel review, the CMS and FDA, and how you intend to manage those.

In particular, I'm wondering if this is a sure thing and the mechanism for that parallel review.

Thanks for asking the question, Charles. Nothing with the FDA or CMS is a sure thing.

It's incumbent on us as a company to make it easy for FDA and CMS to do their job. And I will say that we have a very high-caliber review team that is very engaged, no doubt demanding.

But we also have a strong regulatory team internally to meet those requests. The reason that we are very happy about going through this parallel review pilot program is that screening test to be covered by Medicare need to get a national coverage decision.

So we had to go to Medicare. Unlike many diagnostics who go to their regional contractors, we needed a national coverage decision, and we think that makes sense for us.

Unlike the normal process were you go sequentially, first FDA approval and then 18 months later a national coverage decision, we are able to go through this process in a parallel fashion. And the professionals at CMS are engaged.

They've asked us very clearly for certain information in the submission. And we think this is all a real positive thing.

And we applaud both agencies for working together and being innovative and creative in moving really important products through this parallel review.

Kevin, you also mentioned a study that you're about to start, but you're a little bit non-detailed in terms of the protocol and the kind of data that you'd like to see from that. Could that be a study that is important for this parallel process that would generate pharmacoeconomic data?

Or can you provide us a little bit more color on the study that you mentioned?

So we will provide more color on that study at the appropriate time, which now probably isn't. But to provide a little bit more color, that's a study where patients came in for a colonoscopy and prior to colonoscopy provided a stool sample.

So this will show the test's ability to detect cancer and pre-cancer. It's mainly pre-cancers from samples selected pre-colo.

Because you have to enroll a huge number of patients to get a sufficient number of cancers, there won't be a large number of cancers. We don't expect there will be a large number of cancers in that study.

In terms of being important for CMS and FDA, the most important thing for CMS and FDA is the DeeP-C study.

And then my final question is regarding the data out of the DeeP-C study. It's clearly practice changing if you hit the benchmarks that we've all discussed previously.

But is it possible that you could see that data expand the use of -- or guidelines to earlier than 50 years old? Is there any way to take some takeaways from that study that suggest guidelines should be revised?

The DeeP-C study will include patients over the age of 50. So I won't comment on whether that data would be used to support screening in an earlier patient population.

I will say that we know that under 50 year olds are seeing an increase of 1% to 2% a year every year in the incidence of colorectal cancer. It's a problem.

It's a problem that will probably never be solved by colonoscopy because the incidence rate is awfully low and the cost of colonoscopy is high. So we think there is an opportunity down the road to be creative about it, future studies that show how this test could really positively impact that patient population.

But that's probably not the DeeP-C study.

Kevin, just to follow up to one of your earlier comments on primary care docs. So who will be charged with educating and promoting Cologuard to the primary care physicians?

Will it be in Exact Sciences' sales marketing organization? Will it be your lab partners?

Will it be a combination?

There are a lot of options there. There are some awfully great primary care sales forces out there in the world that could certainly drive this test.

The large reference labs have large primary care sales forces, too. They probably don't move the needle as much as a specialized sales force because just the sheer number of products that they carry their bag, but certainly, they have been able to move the needle with other screening test like the Pap test and the HPV test -- ThinPrep and SurePath and the various HPV tests out there.

So one of the nice things, Jeff, is that we're in a strong position and we have options and we have a really valuable test. So you probably know the way that we approach things pretty carefully and with deep research and after talking to a lot of different groups, and we have time to make that decision.

Okay. And then just one more question, Kevin.

With the addition of Laura as the Chief Commercial Officer, what's going to be her top 2 things she's focusing on for 2012?

In 2012, she is focused. Our #1 priority is to make sure that we have a very, very clear and detailed go-to market plan that we are prepared to execute on.

There are a lot of things that go into the launch of a diagnostic. And that is everything from supporting the lab partners, to the GIs, to the primary care physicians.

A second very important priority is ensuring that we have -- we secure the appropriate level of reimbursement for this test. This test, we think, is a very, very valuable test.

We, as a company, we think that this test justifies a high level of reimbursement. Because remember, colonoscopy, among the private payers of the world, reimburses in the $2,500 range.

And in the Medicare reimburses around $1,000 a test. So we think that this test, which has a lot of advantages relative to other tests, needs and deserves a high level of reimbursement.

And that's what will be a very important priority for Laura.

Kevin, it's Chris Calatudes [ph]. I'd like to compliment you guys for doing the right thing over there.

In my opinion, it's only a matter of time before this test becomes an industry standard. And what you're doing right, now you're just basically going about the formalities to run up the score, get the FDA approval.

And there's no doubt in my mind that when it comes to executing the business plan, you're the guy that make this happen very fast. Now my question here is during this DeeP-C trial that you're doing right now, maybe you're already doing this or would it be an easy thing for you to do to see if one of these patients has a lung cancer also or a pancreas cancer also.

Your test detects it, maybe you pump that out as a news at some point because I think that would create some immediate long-, short-, middle-, every term value for shareholders. Is that being done?

Is that something you can do? Does it cost a lot of money?

Chris, thank you for the nice comments. This study is a study for colon cancer detection, and there are other products that may come out of the company in the future.

But today, we are focused on the DeeP-C study, and those endpoints are really clear and the business plan is very clear. So thank you very much.

So thank you very much. In conclusion, I would just like to take the opportunity to thank all of the people at Exact who worked long hours.

It's really a great team that Maneesh and Graham have built, and I want to thank them for the great work in 2011 and encourage everybody to double their efforts in 2012. Thank you very much.