(Source: ViaVid)

C O R P O R A T E   P A R T I C I P A N T S

Bob Yedid, Investor Relations

Ryan Ashton, Chief Executive Officer and President

Jeff Rona, Chief Financial Officer

C O N F E R E N C E   C A L L   P A R T I C I P A N T S

James Williams, Newbridge Securities

Brandon Williams, Dawson James Securities

P R E S E N T A T I O N

Operator:

Greetings and welcome to the Great Basin Business Update Conference Call.  At this time, all participants are in a listen-only mode.  A question and answer session will follow the formal presentation.  If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad.  As a reminder, this conference is being recorded.

It’s now my pleasure to introduce your host Bob Yedid, Investor Relations for Great Basin.  Thank you, sir.  You may begin.

Bob Yedid:

Good afternoon and welcome to Great Basin Scientific’s third business update call.  This is Bob Yedid of ICR Investor Relations.

Before we begin, I will start with some cautionary statements.  The following discussion regarding Great Basin Scientific contains forward-looking statements for the purposes of the Safe Harbor provision of the Private Securities Litigation Reform Act of 1995, which forward-looking statements involve significant risks and uncertainties, including those discussed in this presentation and others that can be found in the Risk Factors section of Great Basin’s most recent quarterly report on Form 10-Q and other SEC fillings.

All statements, other than statements of historical facts, including this presentation regarding our strategy, future operations, future financial position, future net sales, projected expenses, product placements, performance and acceptance, prospects and plans, and Management’s objectives, as well as growth of the overall market for our products in general and certain products in particular, and the relative performance of other market participants are forward-looking statements.  These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievement to be materially different from those expressed or implied by forward-looking statements.  You should not rely upon forward-looking statements as predictions of future events.  We cannot assure that the events and circumstances reflected in the forward-looking statements will be achieved or occur.  Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason after the date hereof, or to conform these statements to actual results or to changes in our expectations.

With that said, after brief prepared remarks, we’ll be opening the call to a question and answer period.

At this time, it’s my pleasure to turn the conference over to Ryan Ashton, Great Basin’s Chief Executive Officer and President.  Ryan?

Ryan Ashton:

Thank you.  Good afternoon and thank you for being on our third investor update call.  This call will be brief but we are very excited about Great Basin’s progress in sales, research and development, operations and finance and we wanted to take the opportunity to update our current and potential investors on our progress.

As you probably know, Great Basin successfully completed an important equity financing just a few weeks ago.  We are already putting these funds to good use toward accomplishing our key goals for 2015 and beyond.  Our goals are simple:  increase the number of FDA-cleared tests in our menu; increase our customer base; and reduce our cartridge cost of goods sold.

Our focus the past few weeks has been all about those three goals.  First, we have increased the number of instruments our R&D team has available for clinical trials, accelerating those trials, and we have begun expanding our R&D capacity to accelerate the development of our 2016 and 2017 test menu expansion.  As you know, we have plans for seven FDA-cleared tests by the first half of 2016, but we are already working on a number of tests and panels beyond those seven, and with the added capacity in our R&D team we expect to update you soon with an expanded 2016/2017 product roadmap.

Our new tests, both those in clinical trials and those in late and early stage internal development, will increase the attractiveness and utility of our system for new and existing customers, and significantly increase potential recurring revenue per customer.

To increase our customer base, our second goal, we have begun ordering components for an additional 250 analyzers to be allocated for customer acquisition.  Some of these analyzer parts have long lead times and today we anticipate the first analyzers from this new order will roll off the line and ship to eval sites in July of this year.  When this build of 250 analyzers is complete, we will have analyzers adequate to serve approximately 250 to 275 customers.

Our third key area of focus has been manufacturing where we have begun upgrading our facility to increase capacity, automate processes for reduced labor cost and improve our cost of goods sold.

Now more detail on our current sales and R&D efforts.  With the proceeds from our IPO in October, we were able to manufacture 150 new analyzers and re-launch our sales efforts.  I am pleased to tell you that as of the end of February (audio interference) at an evaluation site or committed to a site when ready to ship.  We now have 61 (audio interference)

Operator:

We are experiencing technical difficulties.  Please bear with us.  Thank you.

Unfortunately, we are experiencing technical difficulties.  Please be patient while I reconnect the host.

Rejoining Mr. Ashton.

Ryan Ashton:

Good afternoon.  I’m not certain where you lost me exactly.  I apologize for the technical glitch.

Now more detail on our current…

Bob Yedid:

Ryan, I would start where it says, ‘Now more detail on our current sales and R&D efforts.’  That’s sort of where we left–we lost you.  At the bottom of page…

Ryan Ashton:

With the proceeds from our IPO in October, we were able to manufacture 150 new analyzers and re-launch our sales efforts.  I’m pleased to tell you that as of the end of February, every analyzer allocated for a sales team has been placed at an evaluation site or committed to a site when ready to ship.  We now have 61 hospital sites either currently in evaluation or scheduled to receive analyzers and begin an evaluation as soon as one is available.

We refer to hospital sites evaluating our system as evals.  We expect the final instrument from that initial 150 instrument units ordered after our IPO to ship by the first half of April.

In addition to those 61 eval sites, we now have 91 result-reporting customers in the United States.  Result-reporting customers is our term for customer sites that have completed their evaluation and are purchasing our tests and using our tests to report results to their clinicians.

With the analyzers built from the proceeds of our IPO now allocated, our total sales funnel, both customers and evals combined, will stay at about 150 accounts, however, we anticipate a growing number of that 150 will convert from eval to result-reporting customers, increasing our revenue base.  The evaluation pool and therefore the total sales funnel should begin to increase again in June when we begin scheduling evals for the first of the 250 instruments for which we are now ordering materials.

So from March to May, our sales team will be focusing on completing all of our scheduled installs and closing our evaluations in progress.

As a reminder, we have historically reported a very high win rate so we believe the number of sites in evaluation is a significant indication of our future growth and the business’s strength.

We are very encouraged with the number of active and scheduled evals which will drive the addition of new customers.  We expect to end, therefore, the second quarter of 2015 with 110 to 120 customers reporting their results with our tests, and about 30 to 40 sites in evaluation.  With the increase in analyzers we are manufacturing during the second half of 2015, we expect to end calendar year 2015 with approximately 170 to 180 customers and another 40 to 45 sites in active evaluation.

As we’ve mentioned before, historically, our average revenue per customer for our C. diff test alone has been $20,000 to $22,000 a year.

Now, R&D.  Great Basin’s R&D team continues to execute ahead of plan and we are excited about the promise and revenue potential of our product pipeline.  We have been marketing our FDA-cleared toxigenic C. diff test for over two years, and in November we submitted our Group B Strep test to the FDA.  We have had positive exchanges with the FDA about this submission and we continue to expect FDA clearance of our test in the first half of this year.

As many of you know, the Company initiated a clinical trial for our Staph blood sepsis panel, or Staph ID/R test in November, and in February we commenced the trial for a Shiga toxin-producing e. coli test.  Those trials are progressing well and the data from those trials is strong and in fact is exceeding our expectation for sensitivity and specificity.

We are optimistic about our other R&D efforts as well and anticipate, as I said, initiating clinical trials on three more infectious disease tests during the balance of 2015.  At present, these include our food-borne pathogens panel, Staph Aureus presurgical screening test and a Candida blood infection panel.

Our solid product pipeline, bigger than just six months ago with seven approved, pending or planned infectious disease tests is critical for Great Basin, since the expansion of our menu and the added potential revenue per customer it represents is at the core of our business strategy for 2015 and 2016.  We also look forward to updating you on the additional unannounced tests we are working on as they proceed in development and we can forecast with accuracy when the Company expects to put those tests into clinical trial.

Finally, I’m very pleased to report that Great Basin completed an important financing on March 6th when we closed a $24 million offering of units comprised of preferred stock and common warrants, which raised $21.8 million of net proceeds to the company.  This offering substantially strengthens our balance sheet and allows the management team to focus on our initiatives in sales, R&D and manufacturing.

The Management and employees of the Company are invigorated by this influx of new capital and excited about the opportunity to grow our base of customers and evals and execute the plans we have for 2015 and beyond.

In conclusion, (inaudible) with the Company’s progress to date and based on our stronger cash position, I’m very encouraged about the opportunities ahead.  We hope you are as well.

We appreciate your participation in today’s call.  Before we begin the Q&A session, I need to mention that I’ll be joined by Jeff Rona, our Chief Financial Officer, to help me take your questions.

At this point, Operator, please open the line for questions if you would.

Operator:

Thank you, sir.  At this time we’ll be conducting a question and answer session.  If you’d like to ask a question, please press star, one on your telephone keypad.  A confirmation tone will indicate your line is in the question queue.  You may press star, two if you’d like to remove your question from the queue.  For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys.  Once again, if you’d like to ask a question today, please press star, one at this time.  One moment, please, while we poll for questions.

Our first question today is coming from James Williams from Newbridge Securities.  Please proceed with your question.

James Williams:

I’ve got two quick questions.  Number one, how many total shares now are outstanding if you take all the units and you exercise all units and all the warrants that are out there.  What would be the total amount of shares outstanding?

Ryan Ashton:

Jeff, would you like to take that question?

Jeff Rona:

Sure.  So if we take all of the units and all of the shares, all the preferred get converted and all the warrants that are outstanding get issued, it would be a total of about 44 million fully diluted.

James Williams:

Okay.  Thank you.  The last question is now with such a great demand–congratulations on raising that much money–you can tell the Street is excited about your company.  Is there any plans for any type of brokerage coverage on the common stock?

Jeff Rona:

So I can handle that question.  We’re doing quite a bit of IR and as part of that IR is to help or to start the process of bringing some research coverage to the stock.  I can’t tell you exactly but that’s definitely one of the things that–high on our priority list.

James Williams:

Thank you.

Operator:

Thank you.  Once again, if you’d like to be placed in the question queue, please press star, one at this time.  One moment, please, while we poll for further questions.

Our next question today is coming from Brandon Williams from Dawson James Securities.  Please proceed with your question.

Brandon Williams:

Hi.  My question pertains to the recent Group B strep test cartridge, and I apologize if you addressed this in the call earlier.  It was a little difficult to hear.  But as I read it, I believe you filed the 510(k) application somewhere around mid-November and I understand the PDUFA Act probably pertains to prescription drugs more than devices but it will probably be about 120 days around today.  Has there been any correspondence that you could divulge between you and the FDA regarding the Group B strep test?

Ryan Ashton:

There has and we have been proceeding.  The submission had several comments come back from the FDA.  We’ve responded to those comments and so they actually did put us what they call off the clock for a brief period of time while we were responding to some of the data requests they made.  We’ve made that data submission as of today and we are back on the clock.  So we expect response from the FDA in the earlier part of the next quarter.

Brandon Williams:

Excellent.  Could you comment, if possible, were the comments expected or anticipated, or, you know, best case scenario, were normal in your opinion?

Ryan Ashton:

They were fairly standard kinds of comments.  They asked for us additional data around the stability of one of the carrying media that are used for this type of a test, that kind of a thing.

Brandon Williams:

Excellent.  As far as we’re coming up on the end of Q1, you’ve got three more quarters between now and the end of the year.  Was the estimate to have two or three additional cartridges and/or tests available by year end including the Group B strep?  Is that accurate?

Ryan Ashton:

Yes.  Our plan right now, and we’re tracking to that plan, would be to have four tests approved by the end of 2015, total.  So the current C. diff test, the Group B strep test, our Staph ID/R test and our e. coli test.  We’re tracking to see all four approved by the end of the year.

Brandon Williams:

So the staph and the e. coli are the clinical trials and the data required to be harvested from those trials, are those trials already structured and initiated, or when would you expect to have?

Ryan Ashton:

Yes.

Brandon Williams.

They are already started?

Ryan Ashton:

Yes.  We are in process on those trials.

Brandon Williams:

Are they running concurrently?

Ryan Ashton:

They are.

Brandon Williams:

Do you have any sort of time estimate?

Ryan Ashton:

You know, the only time estimate right now that we are disclosing publicly is that we expect to clearance by the end of the year.  We expect to submit in the early part of the second half of the year and therefore expect to see–well, let’s call it response from the FDA before the end of the year.

Brandon Williams:

Fair enough.  That works for me.  Congratulations on the demand and the capital raise.

Ryan Ashton:

Thank you.

Operator:

Once again, as a reminder, if you’d like to be placed in the question queue, please press star, one at this time.  If you are on a speaker phone, it may be necessary to pick up your handset before pressing the star keys.  Once again that’s star, one to be placed in the question queue.  One moment, please, while we poll for further questions.

If there are no further questions at this time, I’d like to turn the floor back over to Management for any further or closing comment.

Ryan Ashton:

Thank you again for joining us on the call today.  Over the next two quarters we’ll be scheduling meetings with groups of registered representatives and institutional investors, as well as attending investment conferences.  As you’ve heard, there are a lot of positives at Great Basin as our team is executing ahead of plan and we have the–and now we have the financial resources to move ahead decisively.  We look forward to updating you on our business in periodic calls like this one.  In the mean time, if you have questions, please contact Bob Yedid at ICR.  Bob’s contact information is at the end of our press releases.

Thank you again for your time today.  It’s been a pleasure.

Operator:

Thank you.  That does conclude today’s teleconference.  You may disconnect your lines at this time and have a wonderful day.  We thank you for your participation today.


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