You should not rely on forward-looking statements because actual results may differ materially as a result of number of important factors including those set forth in the earnings release issued earlier today. The risks and uncertainties include the factors described under the reading Risk Factors, and the company's prospectus under the reading Risk Factors filed with the SEC on February 8, 2012, and available on the company’s investor relations website at www.neurometrix.com and on the SEC’s website at www.sec.gov and any updates contained in subsequent SEC filings NeuroMetrix does not intend to or undertake no duty to update the information disclosed on this conference call.

I would like to introduce the NeuroMetrix President and CEO, Dr. Shai Gozani.

Dr. Gozani, please proceed.

Thank you very much. I’m joined today on our call by Tom Higgins our Chief Financial Officer.

We are pleased to have the opportunity to review our business and financial highlights for the third quarter of 2012. Following our prepared remarks we are pleased to take questions.

Our goal is to develop a high growth profitable diabetes business focused on diabetic peripheral neuropathy or DPN, which is the most common complication of diabetes. DPN affects over 50% of people with diabetes and causes significant morbidity including pain, increased risk of falling in the elderly and is the primary trigger for diabetic foot ulcers which may require lower extremity amputations.

In spite of its prevalent and clinical impact DPN has been largely unaddressed by medical technology companies. We are taking advantage of this opportunity by introducing novel products for the diagnosis and treatment of DPN.

Our Point-of-Care Diagnostic Test, NC-stat DPNCheck was brought to market at the end of 2011. Our SENSUS pain management device is in late stage development and should be on the market before the end of the year.

During the past several months we have made substantial progress in commercializing our diabetes products. From a negligible amount in 2011 we have reached $1.1 million in DPNCheck revenues through 9 months of 2012.

This includes $300,000 revenue in the third quarter. Looking forward to the full year 2012 we are forecasting that our diabetes revenue will top $1.5 million.

This revenue is entirely attributable to a business that did not exist last year. It is a new line of business and a new technology that is changing medical practice.

We are pleased with our progress and believe we are well positioned for further growth in 2013.

Our installed base of DPNCheck users is growing. Against our 2012 goal of 1,000 DPNCheck devices in the field by year end, we are making good progress.

Today the number has reached about 800 devices. The size and growth of the installed base reflects the clinical utility of DPNCheck and the benefits for fast, accurate and quantitative DPN diagnosis.

It also improves our credibility in the market and provides references for future sales.

We see the market more clearly now than we did at product launch a year ago and therefore we are focused on market strategy. The most attractive application for DPNCheck is in managed care, specifically in Medicare Advantage, where we made important in-roads over the past couple of quarters.

This sector is characterized by organizations like Contec or CMS under capitated rates and thereby assumed risk. They are largely insensitive to traditional pay per service reimbursement and instead focused on patient risk assessment, patient quality of life and lowering health care cost.

These objectives line up well to the benefits provided by DPNCheck. Due to the large size of providers and payers in managed care, this sector represents the fastest path to rapid revenue growth.

The WellMed Medical Group account which we acquired in the second quarter plus additional managed care accounts that have invested in DPNCheck or are currently carrying our pilots give us confidence in the viability of this market. We continue to invest in DPNCheck product development, but with a narrowed emphasis on managed care.

With feedback from earlier doctors we've issued multiple software upgrades during 2012 designed in particular to improve IT electronic medical record integration and compliance reporting.

SENSUS development is also moving forward. We continue to target SENSUS for launch before the end of this year.

We have made positive regulatory progress. The FDA cleared the SENSUS device in August.

Our 510(k) submission on the SENSUS biosensor is now under FDA review with shelf life testing as the only apparent remaining issue. We expect to complete this regulatory filing by early November.

We plan to launch SENSUS in 2 phases. First, a controlled launch in the fourth quarter, followed by a full launch with distribution in the first quarter of 2013.

The controlled launch will involve about 50 to 100 patients. This strategy should get us into the market quickly while delivering early patient and physician’s feedback that will set up for a successful full launch in the first quarter of next year.

Last week’s American Association of Family Practitioners, AAFP, annual meeting was an opportunity for us to detail physicians on SENSUS and stimulate their interest. Physician interest was quite strong and we secured a sizeable number of leads, which we are now qualifying.

The full launch of SENSUS in the first quarter will require DME or Durable Medical Equipment distributors to be in place. In Q2 and Q3 we identified candidates with field sales capabilities to stimulate demand as well as fulfill orders.

This list has been narrowed and we are now in negotiations with several parties. We expect to announce several distributor agreements before the end of the year and additional launch in the next year

Therefore to repeat our goal is to develop a high growth profitable diabetes business. We believe that our results and progress in the third quarter are moving closer to that objective.

I will now turn to Tom for a discussion on financials.

Thanks, Shai. Our financial highlights combine 2 operations, our emerging diabetes business and our historical general purpose neuro diagnostics business.

Diabetes is our sole focus, the neuro diagnostics business is a valuable asset but it is in decline and we manage it for cash flow. It does however continue to contribute the majority of our revenues.

In the financial results for the third quarter we reported revenue of $1.8 million. This sequential quarter decline in revenue from $2.2 million in the second quarter was anticipated in our Q2 earnings call and was attributable to 2 large initial orders for NC-stat DPNCheck which were recorded in Q2 plus the normal seasonality of our business.

Our emerging diabetes business contributed $306,000 in revenues and we shipped 206 new devices plus a few biosensor re-orders. Our diabetes revenue progression since bringing NC-stat DPNCheck to market late last year has been encouraging.

We recorded $85,000 in launch revenue in Q4 of last year, $137,000 in the first quarter of this year, $648,000 in the second quarter, which included WellMed and Wal-Mart Canada, followed by $306,000 in the third quarter. Diabetes revenue during 2012 to-date is $1.1 million and as Shai indicated we are forecasting $1.5 million for the full year, which will mark a successful initial launch year for our diabetes products and position us favorably going into 2013.

Cumulative device shipments through September 30 totaled 778 and are about 800 today. Our 2012 goal is an installed base of a 1,000 devices by the end of the year.

The legacy neuro diagnostics business, which includes the advanced system for neuro conduction testing contributed $1.5 million in the third quarter. This is down slightly from $1.6 million in the second quarter as we continue to see erosion of customer accounts and testing.

We offered a volume based sales promotion for advanced electrodes in Q3, which increased sales by approximately $200,000 above what they would have been based on electrode usage during the quarter. This will have an adverse effect on Q4 sales as higher customer inventory depresses electrode demand.

A recent 9% price increase on advanced electrodes should partially mitigate Q4 demand and testing contraction.

Our Q3 overall gross margin was 55%. That’s level with the second quarter of this year and with Q3 of last year.

Individually the diabetes and neuro diagnostics margin were each about 55% and we expect that margin rate to hold through the fourth quarter.

Operating expenses in Q3 were $3.6 million. This was a reduction of $400,000 from the preceding quarter and a reduction of $300,000 from Q3 2011.

The lower operating expenses in Q3 reflect reduced headcount in sales and marketing and reduced financial and personnel costs in G&A. We forecast Q4 operating expenses to be slightly higher in the range of $3.6 to $3.8 reflecting Q4 trade show activity and costs associated with the launch of SENSUS.

Our net loss in the third quarter was $2.6 million or $0.21 a share, based on a weighted average 12.6 million shares outstanding. This is an improvement over the net loss of $2.8 million or $0.22 per share in the second quarter.

In Q3 last year, we reported a net loss of $2.4 million or $0.63 a share on 3.9 million shares outstanding.

We ended Q3 with $10.9 million in cash and consumed $2.4 million in cash during the quarter. Our outlook is for working capital to increase modestly as we move towards SENSUS launch, resulting in quarterly cash usage of approximately $2.5 to $2.8 million.

Inventory and receivables remain solid with 29 days sales outstanding currently and inventory turnover at 3.4x per year. In contrast, in the third quarter of last year DSOs were higher by 7 days at 36 days sales outstanding and the inventory turnover rate was almost one annual turn slower at 2.5x per year.

That summarizes the financial highlights. I would like to touch on one additional topic.

We reported in September that NASDAQ had granted a 6 month extension until mid-March of 2013 as a grace period to comply with the $1 minimum bid requirement for continued listing. This extension was conditioned on our agreement to a reverse split of our common stock if that was necessary to regain compliance.

Shareholder approval is required for a reverse split. Therefore as part of the NASDAQ process we will be asking shareholders to give our board of directors the authority to order a reverse split should they conclude it is necessary.

If the bid price of our stock returns to a $1 there will not be a reverse split. This is simply to make provision to plan ahead in the event we have no other option in retaining our NASDAQ listing.

The shareholder approval process takes 2 months or longer. So it is important that we start this now.

Shortly we will be mailing proxy documents to all shareholders of record as of October 18, 2012. We ask your support and we will be pleased to respond to any questions you have on this.

The proxy itself changes nothing regarding our business plan and our focus on diabetes. Our goal remains to achieve appreciation of our common stock trading price through compelling business performance.

Shai, back to you.

Thank you, Tom. Well those are our prepared remarks.

So we would be happy to take questions at this point.

I only have one question about the DPNCheck pilot studies. I wonder how the pilot process work, how long will it take, and if you can give us an update on the final studies that some people have started a few months ago, where they stand.

Okay Juan. I just want to make sure I am answering the question.

So, you are referring to the pilot studies that I was noting with some of the managed care, Medicare organizations?

Right.

So these are large organizations typically with many, many clinics and could have anywhere between tens and even over 100,000 covered lives. So, they need to evaluate how well the product operates in their environment, particularly from a - not so much a clinical perspective as more of an operational perspective, integration to their IT systems and so forth.

So, we have a number of those ongoing and several of them were launched in the third quarter. Several of these organizations have actually gone to WellMed to see how they are implementing it.

So we expect several pilots to come to conclusion this quarter, which may lead to - it could even lead to potential new orders this quarter or will set us up well for early next year. But mostly, if I understand your question, the purpose of these pilots is more to understand the integration of this technology into their operational procedures and the ability of their staff to conduct it more than it is the clinical validity.

Just a little more questions on the SENSUS marketing program. Is that going to be similar to what you started with DPNCheck or you are going to target managed care or are you going to target physician practices or - it sounds like next month you are going to target a soft launch for this.

Maybe you could give a…

That’s right. Thank you for the question.

The soft launch or controlled launch is through physicians that we have already - either have expressed interest or are with our existing customers. And as I have said it’s not difficult to get 50 to 100 patients quickly to use the technology.

So that’s pretty straightforward, and really our purpose there is just to, before making it widely available, to get some initial experience and make any adjustments in the device, or particularly training program and so forth. More broadly, the launch is, there are some similarities to DPNCheck in that, many of these diabetes patients are in fact within managed care organizations.

So managed care is a natural target for the product but generally speaking we are also targeting physicians and physician clinics. The difference here is we are going through a - and building a large distribution network, so a large network of durable medical equipment distributors.

We may end up with easily 10 or 20 or more distributors for different markets, different territories, all of which has field sales capabilities either into physician offices, into managed care organizations and so forth. As well as the ability to hold inventory and bill insurance companies.

So it’s really a distribution play more than anything else and we will access various markets through these distributors. So, managed care will be a focus, again because many of the patients that will benefit from SENSUS are within managed care, but it will go beyond managed care through the distributors.

Okay, great. A question for Tom, I guess.

You commented on the NASDAQ and your 6 months extension is to March. What happens in March?

Will you appeal again and try to get another 6 months extension if you are not at $1, or will you have some time to do the reverse split at that point if you have approved it?

Bob, we likely would not be eligible for another 6 month extension at the end of this period. So our plan is really two-fold.

It’s to follow through on our NASDAQ commitment or getting the authority now to do a reverse split should we need to. But more importantly, we have got a lot of business activity in the pipeline including SENSUS that Shai just talked about and building the distribution network, getting that launched as well as opportunities in Medicare Advantage managed care.

And so, we need to keep driving the business and we believe and expect that’s going to be reflected in the stock price. So it’s really building up business momentum.

That is what we are all about. So we need to get this authority in place in the event we should need it.

So I understand that you are building the distribution channels for the SENSUS. But can you talk about how you are going to build awareness among customers with somewhat limited resources?

You are referring to SENSUS Paul, correct?

Yes.

Clearly using the conventional approaches of trade shows, maybe limited advertising, we are not going to be doing extensive promotion from NeuroMetrix because as you know we have limited resources and they are quite expensive. But these durable medical equipment distributors, the ones we are partnering with, the ones that we are talking to and have serious discussions have field sales capabilities.

They have sales reps or free standing clinics or - in some fashion or another field presence, where they can promote and detail the product. So we are looking for our partners to do the heavy lifting on promotion.

There are adequate margins for both NeuroMetrix and our partners in the business model to support that. So to be clear, the heavy lifting on promotion will be done at the field level through our partners and that’s how we will leverage our resources.

So our focus is on getting good partners and supporting our partners.

And the detailing is focused on physicians as opposed to consumers. So it’s making them aware of this product as another alternative in dealing with pain by their patients.

So they are very costly direct to consumer campaign isn't one that we are contemplating.

At this time, that’s correct. Thank you.

Shai, just a quick question with respect to your comments on managed care in the Medicare Advantage market for DPNCheck. How do you identify prospects in this market and what is the typical sales process going through this?

Sure. Thanks for the question.

So the Medicare Advantage market is, it’s fairly defined. There are big players such as UnitedHealth, Humana, Pfizer.

So you sort of know the big players and then there is - from our public information on who owns Medicare Advantage. So we have a good sense of the market.

To get at the market we are working through a network of consultants and connections that we have established [indiscernible] been able to develop relationships with certain consultants in the [indiscernible] in front of the right people. So it’s basically [indiscernible] traditional sales process but we are using consultants and other lead generators that we have been able to identify.

But it is a slow and challenging process to finally get in front of the key decision-makers which are usually highly placed within these organizations. So we are usually talking about Senior VPs, Chief Medical Officers, that sort of level.

But once you get there you can generally move the process along fairly quickly. That being said, the sales cycle usually involves obviously the presentation, the evaluation on their part and then some level of piloting, as I noted before, to make sure that the product - the implementation is viable within a particular organization, and each organization is different.

They have different structures, different kinds of clinics, IT systems and so forth. But we are getting better at it, we are understanding their businesses better.

But we are typically talking 3 to 9 months for some of these large organizations. But at the end of that you are talking about fairly large recurring orders.

So it’s a good business, we are just getting started here. We are very optimistic about where this is going to go including this quarter but in particular next year.

Bob hit most of my questions. But I figured I still would - since I’m in the queue I wanted to comment on the stock split.

I understand basically that you have it covered. We are completely behind that move.

I just wanted to see do you have any color on the numbers yet, what you think the reverse split would be?

No, really where we stand with this is that there is such a long lead time that you have in order to get authorization in place. But what we will do is we will ask shareholders to approve a broad range and that range will be anywhere from 2:1 to 6:1 to provide plenty of flexibility because this isn't an area where we need to make a decision now.

It’s more, in the first quarter, in the middle of the first quarter next year. So, we really - we are now focused on what the ratio might be if it ever comes to that.

It’s more getting the authorization in place.

And when do you think that the mailing would start on that?

Within the week.

Perfect. Do you have any guidance on SENSUS because I know with DPNCheck you gave us a goal.

Do you have any type of goal or guidance on how many SENSUS units you think will be out in 2013?

I don’t yet. So I - that’s a great question and I think once we do this controlled launch, get our distribution partners lined up and understand how that looks, I think we will be in position to say something on that front early in the year.

But I think it would be premature right now because we are still in the process of putting the distribution channel together.

From the numbers, I didn’t get the exact numbers but can I assume that cash now is about $0.84 a share?

Well, we ended the quarter with $10.9 million and we have about 12.6 million shares outstanding. So, it’s about $0.87, $0.88 a share, yes.

Can you give me some sort of an update on Wal-Mart Canada?

Yes, as far as we understand they have now adopted the technology across their 100 pharmacies in Canada. They basically started offering the test during the summer, of course it’s kind of a slow time.

They are ramping up their marketing programs, they are offering the test, we don’t have a lot of feedback in terms of how many tests are being done at this point. I think it’s fairly a slow ramp as they figure out how to best market it and price it within the Canadian system.

But we do understand that they're using the product and testing patient. So, probably by the end of the year we’ll have more information on how they feel about it and what they think the test can do for them, and what kind of volume we’ll get.

But just to come back to kind of our focus. We like the retail market like the Wal-Mart and opportunity to pursue that - their kind of sister organizations in the U.S.

But really we find by far the most attractive opportunity for us is in managed care for the reasons that I have outlined. So, it’s not that we are not focused on those other areas but really we are putting most of our attention into managed care.

I understand that. So I can assume that we won’t see the new device, the SENSUS device also going to Wal-Mart, that’s not a natural…

No, but the reason for - there is somewhat a different reason for that, which is SENSUS is a prescription pain product. So it really is prescribed by a physician and then would be provided by one of our durable medical equipment suppliers.

So, in principal a pharmacy could be a supplier but it would still be going - it would really be just more for provision of the product. They can’t sell it direct, it’s a prescription product.

Understood completely. Tom, do you have any type of guidance when you will be profitable?

Are you expecting that in the next year, in 2013?

Short answer to that is no. We’ve gotten much better visibility on the potential for our first diabetes product, the diagnostic, NC-state DPNCheck.

We are not in the market yet with SENSUS, our second product. SENSUS will play an important role in how rapidly we are able to grow revenue and therefore get to cash flow breakeven and profitability.

Again, it’s a great question. But, I think this time next year once we’ve got a year’s worth of SENSUS experience under our belt, we’ll be in a better position to look forward with that diabetes business.

This is Charles Latario. My questions have already been answered.

The main question I have left is going with your current burn rate right now. It looks like technically going forward you guys have probably got a run rate of about a year left with your current rate right now.

Have you guys looked at any strategic options or - as far as going forward about how you are going to fund this going forward after the year?

Yes, you are right. I mean at the current cash consumption rate we have about a year’s worth of capital.

Of course we are looking at all the various options. So obviously the best one is to ramp up revenue and ramp up the business, that’s clearly been our focus and get the products on the market.

As we have noted there may be a need to raise additional capital next year and obviously we would like to do that with a more attractive stock price. We are also looking at - and we have been actively looking at strategic partners and thinking that seeing if there are opportunities to work with other companies in the diabetes space and potentially that could help out with our cash needs or accelerate the market adoption of our product.

So, obviously we are well aware and very focused on that and trying to look at it, really a myriad of solutions all of which are in consideration at this point.

All right. And as far as your DPNCheck, I know you guys are doing a great job on that and moving forward with that.

As far as the disposables and the reorders, is the pricing structure still the same as far as what you guys are charging part of the reorder on them? What is the status on that?

We’ve actually recently - in a sense we normalized our pricing. So right now the price of the consumables is $20 regardless of volume.

So, we may still get some volume discounts in certain situations. Finally the value proposition actually supports part of the higher price that we initially came out with.

Reorders are typically priced at list or about list, so it’s very similar to the initial order. Particularly in the managed care environment we like that because once they implement the program they would typically test some or all other patients on an annual basis, and so we see that as having a strong reorder component.

Great. And as far as your old business, the neurological business, I know that’s going to be decreasing.

Can you give any numbers going forward next year, when you expect it to completely disappear or is that something that’s just degrading as we go along.

Well, I think it’s deteriorating as all along, and we really have no resources devoted to it. We obviously hold some inventory, ship products to our customers, answer a few calls in our customer service, we don’t really have a clear sense of where we’ll go.

I mean we do expect it to continue generating revenue for and cash flow for several more years. But how much cash flow is really hard to tell, and particularly because we are not engaged with the market.

But, it should generate positive cash flow for at least a couple more years.

And again, I hope you put your efforts into DPNCheck and hopefully you don’t - I mean SENSUS is a great product and I hate to see you lose directionally where you are going.

Shai, regarding SENSUS, since independent distributors will be the key to the launch, can you tell us a little bit more about the selection process and the interest level you are seeing among distributors.

Yes, thank you. Excellent question.

So, the process for us is to identify both national distributors as well as regional distributors. The formula for us is those distributors have a particularly strong footprint in diabetes, or around the general area of diabetes or at least around the area of foot care, and have a field sales promotional and detailing capability.

Because going back to - a few questions back in terms of generating demand we are looking for our partners to be the primary demand generators as opposed to NeuroMetrix. So, we have a profile both at international and regional level.

Again, we are looking for those that have clear and demonstrated capability to detail the product both to physicians, various kind of the clinics in different various markets, and of course they have to have the capability to manage inventory and bill insurance companies. So, they have to have the Medicare and appropriate commercial insurance contracts.

So, we have a pretty good formula and we’ve been out there talking to some very, very good potential partners and I would say the interest has been extremely high and very encouraging. Not surprisingly there is a lot of focus on the diabetes durable medical equipment space for a variety of reasons.

This product represents an interesting product for that space and that’s quite complementary with many of these distributor’s current product portfolios. So, we are optimistic that we will start building that distribution channel this quarter.

Well, it looks like we don’t have any more questions. So, thank you very much for joining us on today’s conference call and we look forward to updating you as we progress with our diabetes business.

Thank you very much.