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Nephros Reports Second Quarter 2012 Financial Results
Date:8/14/2012

so provide positive momentum for increased adoption of the 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.  Nephros has been informed by the Military Government Review Agency that its IWP has been validated to meet the military's NSF P248 standard for emergency military operations as a microbiological water purifier.  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.   At the same event the IWP was also evaluated for performance by a Military Assessment Team and it is expected that the Military will make recommendations for future potential use.  The Special Notice Announcement indicated that an official Sources Sought solicitation would be released; however, this solicitation has not yet been published.  To date, Nephros has received purchase orders for approximately 1,300 IWP's from the U.S. armed forces.

European Hemodiafiltration

Under the licensing agreement with Bellco, S.r.l., Nephros began 2012 with receipt of the second installment payment of euro 750,000 in January.  The third and final installment payment of euro 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
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