Nephros Inc. Receives the 2009 Frost & Sullivan Medical Device Patient Care Company of the Year Award

RIVER EDGE, N.J., Jan. 14 /PRNewswire-FirstCall/ -- Nephros, Inc. , is pleased to announce that it has received the prestigious 2009 Frost & Sullivan Medical Device Patient Care Company of the Year Award, for its rapid growth, progressive technology, and strategic product development.

Nephros was recognized for its ability to develop products that meet market demands. Nephros's breakthrough hemodiafiltration technology has resulted in rapid revenue growth as well as a new therapy for end-stage renal disease (ESRD). Its OLpur(TM) H2H(TM) Module and MD 220 filter received approval under an investigational device exemption (IDE) from the FDA in January 2007. By October, clinical trials were initiated at the Columbia University Dialysis Center in New York. In June 2008, Nephros completed a pivotal trial for its hemodiafiltration products and submitted a 510(k) application in November.

With the hemodialyzer market in the U.S. estimated at nearly $214 million in 2007, Nephros is positioned to generate returns in a maturing industry by offering a unique product supported by numerous scientific studies and clinical trials. While the therapy is pending approval in the U.S., it has already generated revenues in Europe, showing steady growth. Finally, through the leveraging of a platform modality and corporate restructuring, Nephros has taken steps to expand its user base and revenue growth.

Nephros was also recognized by Frost & Sullivan for finding applications of its core technology in other markets. While the company is actively pursuing approval for its online hemodiafiltration therapy, the technology has also found two immediate applications in water purification. With multiple reported outbreaks and deaths due to Legionnaire's disease this past year in institutional facilities in the U.S., Nephros has begun selling two new Dual Stage Ultra-Filtration (DSU) products aimed at preventing the risk of water borne diseases at the point of use.

Legionella, a bacterium which causes Legionnaire's disease, can live in water and is often found in the plumbing systems of buildings such as hospitals, nursing and personal care facilities, ambulatory facilities, and medical and dental practices. Immuno-compromised patients, such as cancer, cystic fibrosis, HIV, organ transplant, dialysis and burn patients, are particularly at risk. The Nephros Protect! Kit for showers and sinks and the Nephros Prevent! Kit for in-line applications such as ice machines and clinical equipment, provide immediate risk mitigation. DSU filtration products are an effective solution which can provide immediate safety from water borne pathogens, including legionella and pseudomonas aeruginosa.

"Although the initial clinical target is ESRD and treatment for kidney failure, the extension into water filtration and creation of the hemodiafiltration module allows the company to develop its products horizontally, creating a marketable brand name," explains Venkat Rajan, Medical Devices Industry Manager, Frost & Sullivan.

Nephros has filed a 510k application for approval to market its DSU to dialysis clinics. Within these clinics, microbial and endotoxin contamination of the water treatment system used to prepare dialysate is an ongoing concern. Several studies have shown a reduction in many inflammation-related parameters, better nutritional indices, reduced beta-2-microglobulin levels, and improved anemia management achieved with less erythropoietin stimulating agents when hemodialysis patients are treated with ultrapure dialysate, in comparison with standard dialysate.

Studies have lauded the efficacy of hemodiafiltration (HDF) in renal blood purification. In contrast to current HDF methods used in blood purification, mid-dilution HDF with the OLpur(TM) MD hemodiafilters combines the higher filtration rate of pre-dilution HDF with the small molecule clearance of post-dilution HDF. The filtration of critical uremic toxins has several beneficial outcomes, such as improving patient survival, reducing medication requirements, and improving blood pressure control.

Nephros's current MDHDF product line consists of two different filters: the MD 190 and the MD 220. Both products are focused on Nephros's proprietary technology and establish a reputation with a platform instead of a product.

"In patient care settings, the initial flux characteristic of revolutionary technologies will eventually give way to acceptance and adoption in light of exceptional performance," adds Rajan of Frost & Sullivan. "Hemodiafiltration is poised to become a breakthrough platform in the area of dialysis."

"We are honored to receive this prestigious award from Frost and Sullivan," explains Ernest Elgin, President and CEO of Nephros, Inc., "and be recognized for leadership and innovation in improving patient care within the medical device industry as well as exploiting the potential of promising technologies."

Nephros' products are marketed and sold outside of the U.S. and have displayed rapid revenue growth. In 2008, third quarter sales showed an increase of 251 percent in comparison with sales in 2007. Overall company revenue has increased by 22 percent nine months into 2008, compared with that of 2007. Through the reduction of overhead costs and operational expenditures, Nephros has focused solely upon maximizing its value to shareholders. The company has also taken further steps such as relocation of its headquarters and the restructuring of its management to improve its strategic position.

The Frost & Sullivan Award for Company of the Year is presented each year to the company that has demonstrated unparalleled excellence within its industry. The Award is based on numerous factors, including the company's business development, competitive strategy, customer satisfaction, and leadership. The company is perceived to exhibit outstanding management and consistent growth, and should have proven expertise in taking advantage of market changes by capturing and solidifying market presence, or through execution of innovative strategies within the existing competitive landscape.

Frost & Sullivan Best Practices Awards recognize companies in a variety of regional and global markets for demonstrating outstanding achievement and superior performance in areas such as leadership, technological innovation, customer service, and strategic product development. Industry analysts compare market participants and measure performance through in-depth interviews, analysis, and extensive secondary research in order to identify best practices in the industry.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best in class positions in growth, innovation and leadership. The company's Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined research and best practice models to drive the generation, evaluation and implementation of powerful growth strategies. Frost & Sullivan leverages over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from 31 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com.

About Nephros, Inc.

Nephros, Inc., headquartered in New Jersey, is a medical device company developing and marketing filtration products for therapeutic applications, infection control, and water purification. The Nephros hemodiafiltration ("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 by the irreversible loss of kidney function. The Nephros HDF system removes a range 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 patient. Nephros ESRD products are sold and distributed throughout Europe and are currently being used in over fifty clinics in Europe. The Nephros Dual Stage Ultra-filter (DSU) is the basis for Nephros'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, parasites and biotoxins. Sale of the DSU has begun at several major U.S. medical centers for infection control and has been selected for further development by the U.S. Marine Corps for purification of drinking water by soldiers in the field. For more information on Nephros, please visit its website at http://www.nephros.com.

Forward-Looking Statements

Statements in this news release that are not historical facts constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the "PSLRA"). Such statements may be preceded by words such as "may," "plans," "expects," "believes," "hopes," "potential" or similar words. For such statements, Nephros claims the protection of the PSLRA.

Forward-looking statements are not guarantees of future performance, are based on assumptions and are subject to various known and unknown risks and uncertainties, many of which are beyond Nephros'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: (i) to maintain compliance with the AMEX's continued listing standards; (ii) to obtain funding if and when needed or on favorable terms; (iii) to continue as a going concern; (iv) to demonstrate in pre-clinical or clinical trials the anticipated efficacy, safety or cost savings of products that appeared promising to Nephros in research or clinical trials; (v) to obtain appropriate or necessary governmental approvals to achieve its business plan or effectively market its products; (vi) to have its technologies and products accepted in current or future target markets; or (viii) to secure or enforce adequate legal protection, including patent protection, for its products. More detailed information about Nephros and the risk factors that may affect the realization of forward-looking statements is set forth in Nephros's filings with the SEC, including Nephros's Annual Report on Form 10-KSB filed with the SEC for the fiscal year ended December 31, 2007, and Nephros's Quarterly Report on Form 10-Q for the periods ended September 30, 2008. Investors and security holders are urged to read these documents free of charge on the SEC's website at http://www.sec.gov/. Nephros does not undertake to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.

CONTACT: Eileen Sukumaran, +1-201-343-5202 ext 100, for Nephros, Inc.

Web site: http://www.nephros.com/

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