Full Press Release Details
Marc Panoff, CFO Garth Russell / Todd Fromer
Nephros, Inc. KCSA Worldwide
Tel: 212-781-5113 212-896-1250 / 212-896-1215
Nephros Reports Second Quarter 2005 Financial Results
NEW YORK, August 15, 2005 - Nephros, Inc. (AMEX: NEP) announced today financial
results for the three months and six months ended June 30, 2005.
For the quarter ended June 30, 2005, Nephros reported net revenue of $226,426,
attributable to sales of its OLpur MD190 product in Europe, compared with no
revenue in the corresponding period of 2004.
The Company's net loss was $2,032,333 for the second quarter of 2005 versus a
net loss of $1,680,033 in the second quarter of 2004. Nephros reported a net
loss attributable to common stockholders in the second quarter of 2005 of
$2,032,333, or $0.17 loss per basic and diluted share, compared to a loss of
$4,360,120, or $2.74 loss per basic and diluted share, in the year-earlier
For the six months ended June 30, 2005, Nephros reported net revenue of
$2,128,091 compared with no revenue in the first six months of 2004. In the
first half of 2005, net revenue recognized from product sales totaled $378,091.
Half-year revenue also included a one-time, upfront fee of $1.75 million
resulting from Nephros's license agreement with Asahi Kasei Medical Co., Ltd.,
the largest filter provider in Japan, entered into on March 2, 2005.
Nephros's net loss was $2,425,220 for the first half of 2005 versus a net loss
of $3,697,766 in the comparable period last year. Nephros reported a net loss
attributable to common stockholders for the first half of 2005 of $2,425,220, or
$0.20 loss per basic and diluted share, compared to a loss of $8,449,353, or
$5.30 loss per basic and diluted share, in the year-earlier period.
It should be noted that, although Nephros began selling products in the first
quarter of 2004, Nephros does not recognize revenue from product sales until a
customer's right of return has expired. Accordingly, Nephros reported no revenue
during the first half of 2004. It should also be noted that the differences
between net loss and net loss attributable to common stockholders for the 2004
periods are the result of the accrual of preferred dividends and the accretion
of a beneficial conversion feature associated with Nephros's issuance of series
D convertible preferred stock.
As of June 30, 2005, Nephros had cash, cash equivalents and short-term
investments of $8,813,624.
"I am pleased with our achievements in the second quarter of 2005. In June, we
received approval from the FDA to market our OLpur(TM) HD190 high flux filter in
the U.S., a significant milestone for our company. While the Olpur(TM) HD190 is
not expected to offer a substantial sales opportunity in the foreseeable future,
we believe that the FDA approval of the Olpur(TM) HD190 is an important step in
the regulatory process to gain approval for our more advanced End-Stage Renal
Disease therapies in the U.S.
In addition, we recently received U.S. patent confirmation for our Olpur(TM)
H2H(TM) online hemodiafiltration module, giving us the exclusive right, subject
to FDA approval, to use our Olpur(TM) H2H(TM) product to open the U.S. market to
hemodiafiltration, which has been shown to be a superior therapy to
hemodialysis," stated Norman Barta, chief executive officer of Nephros.
"In addition to progress in the U.S., we continue to make marked strides in the
European market. During the second quarter, we built upon the initial sales of
our OLpur(TM) MD190 and initiated supplemental clinical trials in five European
countries which are designed to demonstrate the OLpur(TM) MD190's effectiveness
in removing a range of blood toxins and other factors contributing to overall
therapy cost savings and patient well-being. We're pursuing our strategy of
attaining targeted, measurable sales growth throughout Europe, and in turn
expanding into other key geographic areas including the U.S. We have made
measurable progress in the execution of our business plan during the first half
of 2005, and remain focused on increasing sales and driving market penetration
of our advanced mid-dilution hemodiafiltration technologies," Barta concluded.
Nephros, Inc., headquartered in New York, is a medical device company developing
and marketing products designed to improve the quality of life for the End-Stage
Renal Disease (ESRD) patient, while addressing the critical financial and
clinical needs of the care provider. ESRD is a disease state characterized by
the irreversible loss of kidney function. Nephros believes that its products are
designed to remove a range of harmful substances more effectively, and more
cost-effectively, than existing treatment methods; particularly with respect to
substances known collectively as "middle molecules," due to their molecular
weight, that have been found to contribute to such conditions as dialysis
related amyloidosis, carpal tunnel syndrome, degenerative bone disease and
ultimately, to mortality in the ESRD patient.
Forward Looking Statements
This news release contains certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995, as amended.
Such statements may include statements regarding the efficacy and intended use
of Nephros's technologies under development, the timelines for bringing such
products to market and the availability of funding sources for 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,
Nephros claims the protection of the Private Securities Litigation Reform Act of
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 the control of Nephros. Actual results
may differ materially from the expectations contained in the forward-looking
statements. Factors that may cause such differences include the risks that: (i)
products that appeared promising in research or clinical trials to Nephros may
not demonstrate anticipated efficacy, safety or cost savings in subsequent
pre-clinical or clinical trials; (ii) Nephros may not obtain appropriate or
necessary governmental approvals to achieve its business plan; (iii) product
orders may be cancelled, patients currently using Nephros's products may cease
to do so and patients expected to begin using Nephros's products may not; (iv)
hemodiafiltration therapy may not be accepted in the United States and/or
Nephros's technology and products may not be accepted in current or future
target markets, which could lead to the failure to achieve market penetration of
Nephros's products; (v) Nephros may not be able to sell its products at
competitive prices or profitably; (vi) Nephros may not be able to secure or
enforce adequate legal protection, including patent protection, for its
products; (vii) FDA approval relating to Nephros's Olpur(TM) HD190 filter may
not facilitate or have any effect on the regulatory approval process for
Nephros's other products; and (viii) Nephros may not be able to achieve sales