Bio-Reference Laboratories, Inc Q3 2008 Earnings Call Transcript

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2008-09-10 16:06:11.0

Tags: Bio-Reference Laboratories Inc.

Question-and-Answer Session

Operator

(Operator instructions). And your first question comes from Robert Willoughby of Banc of America Securities. Please proceed.

Aaron Gornin

Hi. This is Aaron Gornin for Bob today. Just a question on the bad debt, can you comment on the current level and where you see that going forward?

Marc Grodman

Our level, we said it was about 13%. So, once we into get into basis points, it's somewhat a little bit above that. Bad debt is a function, we believe, of payer mix. The more times that you have a patient, who's responsible for the bill, you're going to have higher bad debt and our mix of businesses has not really changed. We've been rather consistent between 13 and 14% for quite a long period of time. I don't see the level of the change, because I don't see our demographics changing.

As I say, this is a function of demographics. Patients don't really pay their individual laboratory bills in good or bad economic times. And I don’t think that's going to really change. So, I don't see the levels as being very different historically in the future as what they've been historically.

Aaron Gornin

Okay. And secondly, on the sales and marketing expenses, do you see that level of spend tapering off as the investments play out or do you want to maintain that for a period of time?

Marc Grodman

You know what, as I said in the comments. We've made the significant increase to investments. I think that we are kind of, where we are. I don't see an extraordinary increase going forward. It's going to be up to us to leverage it. It doesn't mean we are not going to be looking to hire more people, of course it doesn't mean that at all. But the huge increase that we had. I think that we did and now it's going to kind of be business as usual from this point on.

Aaron Gornin

Okay, great. Thank you.

Marc Grodman

Thank you very much.

Operator

And your next question comes from Art Henderson from Jefferies & Company. Please proceed.

Art Henderson - Jefferies & Company

Hi. Thanks for taking the question a very nice quarter. Marc, could you talk a little bit more about the R&D expense that's you're putting into the GenPath and GeneDx divisions? Is that science related or hiring related? Could you just elaborate on that a little bit?

 

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