Welcome!

News Feed Item

Nephros Reports Third Quarter 2012 Financial Results

RIVER EDGE, N.J., Nov. 8, 2012 /PRNewswire/ -- Nephros, Inc. (OTC Bulletin Board: NEPH), a commercial stage medical device company that develops and sells high performance liquid purification ultrafilters, announced today financial results for the three and nine months ended September 30, 2012.

Recent Highlights

  • Year-to-date ultrafilter sales to our three target markets (Dialysis, Hospital and Military) of over $800,000 vs. approximately $600,000 for full year 2011
  • First shipment of over 1,300 ultrafilters to U.S. Military
  • First European ultrafilter order processed through Nephros International
  • Appointed Frank Zumbo, Denise Pappas and Stephen Bob as Regional Sales Managers to focus on ultrafilters in dialysis and hospital markets
  • New distributor agreements signed with Vantage Water and OnLine Sales for distribution of ultrafilters to dialysis and hospital markets
  • New Nephros website launched

"The third quarter was the best sales quarter to date for our ultrafiltration product portfolio," said John C. Houghton, President and CEO of Nephros.  "Our ultrafiltration product revenues for the first nine months of 2012 have already exceeded sales of this product line for all of 2011.  I am encouraged by these results and am enthusiastic about our positioning for the remainder of 2012 and into 2013."

"The recent expansion of our sales team and our newly executed distributor agreements are beginning to yield tangible results.  Ultrafiltration revenues for 2012 have been diversified across sales to the dialysis market, hospital market, and to the U.S. military.  We continue to evaluate additional candidates and distributors for our U.S. sales efforts as we continue to foster our ongoing cooperation with the U.S. military."

Third Quarter 2012 Financial Results

  • Total revenues for the quarter ended September 30, 2012 were $604,000 as compared with $407,000 for the quarter ended September 30, 2011. The increase in revenues for the third quarter 2012 was primarily driven by increased sales of ultrafilter products to Dialysis Centers and Hospitals of approximately $200,000, initial sales of ultrafilter products to U.S. Military of approximately $114,000, initial sales of ultrafilter products in Europe of approximately $10,000 and increased licensing revenue of approximately $133,000.  These increases were partially offset by reductions of approximately $154,000 related to the STERIS project and approximately $106,000 related to the Office of Naval Research project which ended March 31, 2012.
  • Total operating expenses for the quarter ended September 30, 2012 were $1,266,000 compared with $734,000 for the quarter ended September 30, 2011. The increase was primarily driven by the addition of administrative and sales personnel and their related costs as well as a reduction in revenue generating research projects absorbing research personnel costs.  Legal and marketing expenses increased in the quarter ended 2012 compared to the same period in 2011.  Additionally, there were increases in amortization expense of the fees due related to the long-term supply agreement with Medica signed earlier this year.
  • Net loss for the quarter ended September 30, 2012 was $853,000, or $0.07 per share (based on 11.6 million weighted average shares outstanding) compared to $413,000, or $0.04 per share (based on 10.0 million weighted average shares outstanding) for the quarter ended September 30, 2011. As of September 30, 2012, the Company had 11.6 million shares outstanding.
  • Nephros ended the third quarter of 2012 with cash and cash equivalents of $366,000.

Dialysis and Hospital Applications - Ultrafilters

For the third quarter of 2012, Nephros recorded approximately $312,000 of sales related to its water and bicarbonate ultrafiltration products, a 180% increase over the prior year period.  For the first nine months of 2012 Nephros recorded $687,000 of sales related to its water and bicarbonate ultrafiltration products, a 65% increase over the prior year period.  With the recent additions of three Regional Sales Managers, the execution of distribution agreements with national distributors and the introduction of an enhanced product range, we believe that Nephros is positioned for growth in the dialysis and waterborne hospital infection control markets.  More stringent standards for dialysis water purity from the Association for the Advancement of Medical Instruments (AAMI), bundling of dialysis reimbursement payments, and the Affordable Care Act initiatives which relate hospital reimbursement rates to infection control compliance can also provide positive momentum for increased adoption of Nephros ultrafiltration products. Following the execution of the Medica agreement, we are now offering a full range of point-of-use filters for hospital infection control, including SafeSpout and SafeShower filters, worldwide.

Military Applications - Ultrafilters

In response to a Special Notice Announcement from the U.S. Army, Nephros submitted its Individual Water Purifier (IWP) device containing the Nephros proprietary ultrafilter technology for consideration as part of a standard issue personal hydration pack for soldiers in the field.  The Special Notice Announcement indicated that an official Sources Sought solicitation would be released; however, this solicitation has not yet been published.  Nephros has been informed by the Military Government Review Agency that its IWP has been validated to meet the military's NSF P248 standard as a microbiological water purifier for military operations.  In April 2012, Nephros presented its IWP as part of the Experimental Forward Operating Base demonstration and assessment event at Camp Lejeune in North Carolina.  The IWP was evaluated by approximately 100 U.S. Marines and a Military Assessment Team.  To date, Nephros has shipped approximately 1,300 IWP's to the U.S. armed forces, equating to approximately $114,000 of sales.  In addition we have received a separate order for approximately $85,000 for IWPs, which we expect to be shipped before year end.

European Hemodiafiltration

Under the licensing agreement with Bellco, S.r.l., Nephros began 2012 with receipt of the second installment payment of €750,000 in January.  The third and final installment payment of €600,000 is payable to Nephros on January 15, 2013.  Beginning on January 1, 2015 until December 31, 2016, Nephros expects to receive royalty payments from Bellco as part of the license agreement.  During the license period, Nephros no longer recognizes sales from the licensed territory, but rather licensing revenue and royalty payments.  For the third quarter of 2012, amortized license revenue from the Bellco agreement was $166,000.

U.S. Hemodiafiltration

In April 2012, Nephros received FDA 510(k) clearance to market the Company's hemodiafiltration (HDF) system in the U.S. for the treatment of patients with chronic renal failure when used with a UF controlled hemodialysis machine that provides ultrapure dialysate in accordance with current AAMI/ANSI/ISO standards.  Nephros intends to pursue a limited launch of its HDF system prior to expanding into the broader market.  We are currently preparing our HDF system for a scaled market release and expect to have units placed in a select number of dialysis clinics in the first quarter of 2013.  In parallel, Nephros continues to explore opportunities to leverage the resources of a strategic partner to most effectively address the market.  There are more than half a million patients in the U.S. whose kidneys have failed requiring them to seek treatment.  Of these, approximately 370,000 are receiving hemodialysis.  In 2009 the total medical care costs for Chronic Renal Failure reached $42.5 billion. The Nephros HDF system is the only FDA-cleared on-line mid-dilution HDF therapy available in the U.S.

About Nephros, Inc.

Nephros is a commercial stage medical device company that develops and sells high performance liquid purification filters. Our filters, which we call ultrafilters, are primarily used in dialysis centers and healthcare facilities for the production of ultrapure water and bicarbonate.  Because our ultrafilters capture contaminants as small as 0.005 microns in size, they eliminate a wide variety of bacteria, viruses, fungi, parasites, and endotoxins harmful to humans.

All of our ultrafilters use proprietary hollow fiber technology.  We believe the hollow fiber design allows our ultrafilters to be the only commercially available filters for healthcare applications that optimize the three elements critical to filter performance:

  • Filtration – as low as 0.005 microns
  • Flow rate – minimal disruption
  • Filter life – up to 12 months

By comparison, competitive filters on the market today are typically effective only to the 0.2 micron level and are prone to clog more quickly, thus reducing their useful lives.

We were founded in 1997 by healthcare professionals affiliated with Columbia University Medical Center/New York-Presbyterian Hospital to develop and commercialize an alternative method to hemodialysis (HD).  In 2009, we began to extend our filtration technologies to meet the demand for liquid purification in other areas, in particular water purification.

Presently, we offer seven types of ultrafilters for sale to customers in four markets:

  • Dialysis Centers – Water/Bicarbonate:  Treatment of both water and bicarbonate for the production of ultrapure dialysate
  • Hospitals and Other Healthcare Facilities:  Removal of infectious agents in drinking and bathing water, particularly in high risk patient areas
  • Military:  Highly compact, individual water purification devices used by soldiers to produce safe drinking water in the field
  • Dialysis Centers – Blood:  Clearance of toxins from blood using an alternative method to HD in patients with chronic renal failure

We have designed our ultrafilters as either in-line products, filters that are incorporated into the existing plumbing of healthcare facilities, or point-of-use products, filters that can be easily installed onto a faucet or as a replacement shower head or can be used stand-alone to purify small quantities of water immediately prior to use.

For more information about Nephros, please visit the company's website at www.nephros.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended (the "PSLRA"). Such statements include statements regarding the efficacy and intended use of our technologies under development, the timelines for bringing such products to market and the availability of funding sources for the continued development of such products and other statements that are not historical facts, including statements which may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. For such statements, we claim the protection of the PSLRA. Forward-looking statements are not guarantees of future performance are based on certain assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond our control. Actual results may differ materially from the expectations contained in the forward-looking statements. Factors that may cause such differences include, but are not limited to, the risks that:

  • we may not be able to continue as a going concern;
  • we may not be able to obtain funding if and when needed or on terms favorable to us in order to continue operations;
  • we may not obtain appropriate or necessary regulatory approvals to achieve our business plan;
  • products that appeared promising to us in research or clinical trials may not demonstrate anticipated efficacy, safety or cost savings in subsequent pre-clinical or clinical trials;
  • we may encounter problems with our suppliers and manufacturers;
  • we may encounter unanticipated internal control deficiencies or weaknesses or ineffective disclosure controls and procedures;
  • we may not be able to effectively market our products;
  • we may not be able to sell our water filtration products or chronic renal failure therapy at competitive prices or profitably;
  • we may not be able to secure or enforce adequate legal protection, including patent protection, for our products; and
  • we may not be able to achieve sales growth in key geographic markets.

More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this press release, is set forth in our filings with the SEC. We urge investors and security holders to read those documents free of charge at the SEC's web site at www.sec.gov. We do not undertake to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law.

 

SOURCE Nephros, Inc.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that Outscale, a global pure play Infrastructure as a Service provider and strategic partner of Dassault Systèmes, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2010, Outscale simplifies infrastructure complexities and boosts the business agility of its customers. Outscale delivers a secure, reliable and industrial strength solution for its customers, which in...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend @CloudExpo | @ThingsExpo, June 6-8, 2017, at the Javits Center in New York City, NY and October 31 - November 2, 2017, Santa Clara Convention Center, CA. Learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
SYS-CON Events announced today that EARP Integration will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. EARP Integration is a passionate software house. Since its inception in 2009 the company successfully delivers smart solutions for cities and factories that start their digital transformation. EARP provides bespoke solutions like, for example, advanced enterprise portals, business intelligence systems an...
IBM helps FinTechs and financial services companies build and monetize cognitive-enabled financial services apps quickly and at scale. Hosted on IBM Bluemix, IBM’s platform builds in customer insights, regulatory compliance analytics and security to help reduce development time and testing. In his session at 20th Cloud Expo, Tom Eck, Industry Platforms CTO at IBM Cloud, will discuss how these tools simplify the time-consuming tasks of selection, mapping and data integration, allowing developers ...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
In his session at 20th Cloud Expo, Brad Winett, Senior Technologist for DDN Storage, will present several current, end-user environments that are using object storage at scale for cloud deployments including private cloud and cloud providers. Details on the top considerations of features and functions for selecting object storage will be included. Brad will also touch on recent developments in tiering technologies that deliver single solution and an end-user view of data across files and objects...
For financial firms, the cloud is going to increasingly become a crucial part of dealing with customers over the next five years and beyond, particularly with the growing use and acceptance of virtual currencies. There are new data storage paradigms on the horizon that will deliver secure solutions for storing and moving sensitive financial data around the world without touching terrestrial networks. In his session at 20th Cloud Expo, Cliff Beek, President of Cloud Constellation Corporation, w...
Most DevOps journeys involve several phases of maturity. Research shows that the inflection point where organizations begin to see maximum value is when they implement tight integration deploying their code to their infrastructure. Success at this level is the last barrier to at-will deployment. Storage, for instance, is more capable than where we read and write data. In his session at @DevOpsSummit at 20th Cloud Expo, Josh Atwell, a Developer Advocate for NetApp, will discuss the role and value...
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assis...
SYS-CON Events announced today that Progress, a global leader in application development, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Enterprises today are rapidly adopting the cloud, while continuing to retain business-critical/sensitive data inside the firewall. This is creating two separate data silos – one inside the firewall and the other outside the firewall. Cloud ISVs oft...
The 21st International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Machine Learning and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding busin...
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 21st International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @ThingsExpo Silicon Valley Call for Papers is now open.
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
As cloud adoption continues to transform business, today's global enterprises are challenged with managing a growing amount of information living outside of the data center. The rapid adoption of IoT and increasingly mobile workforce are exacerbating the problem. Ensuring secure data sharing and efficient backup poses capacity and bandwidth considerations as well as policy and regulatory compliance issues.
Interested in leveling up on your Cloud Foundry skills? Join IBM for Cloud Foundry Days on June 7 at Cloud Expo New York at the Javits Center in New York City. Cloud Foundry Days is a free half day educational conference and networking event. Come find out why Cloud Foundry is the industry's fastest-growing and most adopted cloud application platform.