Nephros Posts Financial Results For 2016, Gives Company Update

Nephros (OTCQB:NEPH) announced its financial results for the fourth quarter and full year 2016. They also released an update on the company.
As quoted in the press release:

“In 2016, we continued to execute on our growth strategy, focusing on the expansion of our product portfolio and on enhancing our sales and marketing efforts,” said Daron Evans, President and Chief Executive Officer of Nephros. “We launched the S100 Point of Use product line, and completed our regulatory submissions for the HydraGuard™ and EndoPur™ product lines, which will we expect to launch in the second quarter of 2017. Additionally, we have completed the development of our NanoGuard-E product that inserts into any existing Everpure filter manifold, a standard in the food service industry. We also completed the development of our upcoming lead filter.”
“Our approximately 40% growth in product revenue in the fourth quarter of 2016, versus the third quarter of 2016, was a result of both the launch of the S100, and growth from our existing filter portfolio. We expect a similar increase in revenue as we launch the HydraGuard™ and EndoPur™ product lines. We believe that we will grow filters sales in our core markets by over 100% in 2017 versus 2016, and that we be able to reach cash flow positive in three to six months now that we are through the regulatory approval process.”
Corporate Update
Hospital Infection Control Filter Market
In 2016, revenue from the hospital infection control market grew 30% versus 2015. We expect this growth rate to increase significantly in 2017, due to several factors, including fast-growing sales of the new S100 Point-of-Use filter, the planned launch of the HydraGuard™ in the second quarter of 2017, and the planned launch of a flushable version of the HydraGuard™, to be released in the third quarter of 2017.
Dialysis Water Filter Market
In 2016, revenue from the dialysis water filter market declined 19% versus 2015. We narrowed our dialysis water sales and marketing efforts to focus on polish filters for reverse osmosis (“RO”) systems. We are planning to launch our EndoPur™ Endotoxin filter product line, which is targeted at large dialysis clinic RO systems, in the second quarter of 2017.
Commercial / Industrial Water Filter Market
We have been working with our customers and strategic distribution partners to better understand the potential for our products in the commercial and industrial sector. We have performed pilot tests in multiple areas of potential interest. We are beginning to focus on certain niche markets where we believe our products may add substantial value and expect a meaningful revenue contribution from the commercial / industrial water filter market in 2017.
Hemodiafiltration System
Vanderbilt University began treating patients with our hemodiafiltration (“HDF”) systems early in 2017. For the foreseeable future, we intend to support Vanderbilt in any efforts to publish prospective and observational data resulting from the treatment of patients with HDF.
Financial Performance for the Year Ended December 31, 2016
Total revenues for the year ended December 31, 2016, were approximately $2,320,000 compared to approximately $1,944,000 for the year ended December 31, 2015.
Cost of goods sold was approximately $1,026,000 for the year ended December 31, 2016, compared to approximately $844,000 for the year ended December 31, 2015.
Research and development expenses were approximately $1,079,000, and $826,000, respectively, for the years ended December 31, 2016 and December 31, 2015. Depreciation and amortization expense was approximately $230,000 for the year ended December 31, 2016, compared to approximately $212,000 for the year ended December 31, 2015. Selling, general and administrative expenses were approximately $2,854,000 for the year ended December 31, 2016 compared to approximately $3,443,000 for the year ended December 31, 2015.
As of December 31, 2016, Nephros had cash and cash equivalents of approximately $275,000.
About Nephros, Inc.
Nephros is a commercial stage medical device company that develops and sells high performance liquid purification filters, as well as a hemodiafiltration system for the treatment of patients with End Stage Renal Disease. Its filters, which it calls ultrafilters, are used primarily in medical applications. Nephros ultrafilters are used by dialysis centers for the removal of biological contaminants from the water and bicarbonate concentrate feeding hemodialysis devices. Additionally, Nephros ultrafilters are used in hospitals and medical clinics as an aid in infection control by retaining bacteria (i.e. Legionella, Pseudomonas), virus and endotoxin from water used by patients.
For more information about Nephros, please visit the company’s website at www.nephros.com.

Click here to read the full press release.