Nephros Reports 2008 First Quarter Financial Results Thursday

Reports 2008 First Quarter Financial Results

NY -- May 15, 2008 -- Nephros, Inc. (AMEX:NEP - News) announced today financial

results for the three month period ended March 31, 2008.

first quarter of 2008 marked another milestone for Nephros on the path toward

U.S. approval of the Nephros HDF treatment for end-stage renal disease,"

commented Norman J. Barta, Chairman and CEO of Nephros. "In the first quarter,

Nephros completed enrollment in the Company's pivotal U.S. clinical trial for

the OLpur(TM) H2H(TM) Hemodiafiltration Module and OLpur(TM) MD 220

Hemodiafilter. More recently, Nephros solidified its management team with the

addition of two new executives as we strive to grow and expand our water filter

sales and European hemodiafilter sales while preparing for the anticipated

launch of the Company's HDF therapy system."

Performance for the First Quarter Ended March 31, 2008.

quarter ended March 31, 2008, Nephros reported product revenues of $387,000,

attributable to sales of its OLpur(TM) MD190 and MD220 products in Europe,

compared with $296,000 in the corresponding period of 2007, an increase of

The Company's net loss was $1,640,000 or $.04 per basic and diluted common

for the first quarter of 2008 versus a net loss of $1,517,000 or $.13 per basic

and diluted common share in the first quarter of 2007. The substantial change

the per share loss is primarily due to there being 38,165,380 weighted average

common shares outstanding basic and diluted during the 2008 period as compared

to 12,317,992 during the 2007 period.

March 31, 2008, Nephros had cash and cash equivalents in the amount of

$2,505,000. In addition, Nephros had $4,286,000 invested in auction rate

securities, which are classified as non-current investments at March 31,

Clinical Trial Update

first quarter of 2008, Nephros completed enrollment in the Company's pivotal

U.S. clinical trial for the OLpur(TM) H2H(TM) Hemodiafiltration Module and

OLpur(TM) MD 220 Hemodiafilter products for the treatment of patients with

end-stage renal disease (ESRD). Nephros anticipates that all enrolled patients

will have completed the study protocol by June 1, 2008.

second half of 2008, we plan to seek FDA approval to market our leading-edge

products here in the U.S.," said Mr. Barta. Nephros believes that, if approved

in 2008, its mid-dilution HDF technology would be the first approved online

therapy in the United States.

Ultrafiltration Products

is finalizing improvements to the functionality and ergonomics of its water

ultrafiltration products and has applied for stringent water filter performance

certifications from NSF International, an independent non-profit product

evaluation laboratory. NSF has completed its initial stage of testing, and

Nephros anticipates final completion of required NSF testing during the second

expects to continue its military product development with support from its

existing cost contract with the Office of Naval Research and other contracts

that may arise out of the U.S. Department of Defense appropriations that have

been made for such purpose.

Inc., headquartered in New York, is a medical device company developing and

marketing filtration products.

Nephros HDF system is 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

the irreversible loss of kidney function. The Nephros HDF system removes a

of harmful substances more effectively, and with greater capacity, than existing

ESRD treatment methods, particularly with respect to substances known

collectively as "middle molecules." These molecules have been found to

contribute to such conditions as dialysis-related amyloidosis, carpal tunnel

syndrome, degenerative bone disease and, ultimately, mortality in the ESRD

Nephros Dual Stage Ultrafilter (DSU) is the Company's line of water filtration

products. The patented dual stage cold sterilization Ultrafilter has the

capability to filter out bacteria and, due to its exceptional filtration levels,

filter out many viruses and parasites. The DSU proprietary design provides

dual-stage filtration which reduces the risk of filtration failure. With an

initial focus on health care, the DSU is in a pilot-use program at a major

medical center and has been selected for further development by the U.S. Marine

products are sold and distributed throughout Europe and the Company's dialysis

filters are currently being used in over fifty clinics in Europe.

information on Nephros please visit the Company's website,

release contains certain "forward-looking statements" within the meaning of

Private Securities Litigation Reform Act of 1995, as amended. Such statements

include statements regarding the efficacy and intended use of the Company's

technologies under development, the timelines for bringing such products to

market and the availability of funding sources for continued development of

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, the

Company claims the protection of the Private Securities Litigation Reform Act

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 Company's control. Actual results

may differ materially from the expectations contained in the forward-looking

statements. Factors that may cause such differences include the risks that:

Nephros may not be able to obtain funding if and when needed or on terms

favorable to it in order to continue operations or fund its clinical trials;

(ii) Nephros may not be able to continue as a going concern; (iii) Nephros

not be able to liquidate its short-term investments when needed to fund its

operations; (iv) Nephros may be unable to maintain compliance with the American

Stock Exchange's continued listing standards; (v) products that appeared

promising to Nephros in research or clinical trials may not demonstrate

anticipated efficacy, safety or cost savings in subsequent pre-clinical or

clinical trials; (vi) Nephros may not obtain appropriate or necessary

governmental approvals to achieve its business plan or effectively market its

products; (vii) Nephros may encounter unanticipated internal control

deficiencies or weaknesses or ineffective disclosure controls and procedures;

(viii) HDF therapy may not be accepted in the United States and/or Nephros'

technology and products may not be accepted in current or future target markets,

which could lead to failure to achieve market penetration of Nephros' products;

(ix) Nephros may not be able to sell its ESRD therapy or water filtration

products at competitive prices or profitably; (x) Nephros may not be able to

secure or enforce adequate legal protection, including patent protection, for

its products; and (xi) Nephros may not be able to achieve sales growth in Europe