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(AMEX Symbol: XCR) Roth 20th Annual OC Growth Stock Conference February 19, 2008 Forward-Looking Statements Except for statements of historical fact, the matters discussed in this presentation are forward looking and pursuant to the safe harbor provisions of the private Securities Litigation Reform Act of 1995. These forward-looking statements reflect numerous assumptions and involve a variety of risk and uncertainties, many of which are beyond the company’s control that may cause actual results to differ materially from stated expectations. These risk factors include, among others, limited operating history, difficulty in developing, exploiting, and protecting proprietary technologies, the risk that our technology may not be effective, uncertainty as to the outcome of legal proceedings, intense competition, and substantial regulation in the medical device and healthcare industries, as discussed in the Company’s periodic reports filed with the Securities and Exchange Commission, available on its website at http:/www.sec.gov. 2 Management Team • Dan Goldberger, MSME Chief Executive Officer • Winson Tang, MD, FACP Chief Operating Officer • Victor Gura, MD Chief Medical Officer • Sound Surgical, Glucon, OSI Systems, Optiscan • Amgen, Vertex, Tularik, Isis, Pacific Capital Grp • Cedars-Sinai Med. Cntr, Assoc. Clin. Prof., UCLA • Robert Weinstein, CPA, MBA • Able Labs, Healthcare Chief Financial Officer Private Equity, GE Cap. 3 Selected Board Members • Hans Polaschegg, Ph.D • Fresenius • Extracorporeal Technological Committee Chairman • Kelly McCrann, MBA • • • • 4 DaVita PacificCare KPMG McKinsey & Co. Xcorporeal Highlights • Extra-corporeal medical devices that could replace the function of failing or failed organs • Multiple initial products – Portable Hospital Hemodialysis device – Portable Home Hemodialysis device – Wearable Artificial Kidney • First U.S. 510(k) filing anticipated Q4, 2008 • Minimal to low risk strategy – Prototype device tested successfully – Well defined and straightforward regulatory strategy – Well delineated reimbursement codes • Multi-billion dollar and clearly defined markets 5 Xcorporeal Hemodialysis Devices • Portable Hemodialysis Device - Hospital CRRT/Acute Hemodialysis • Portable Hemodialysis Device - Home Hemodialysis – ESRD • Wearable Artificial Kidney - Home Hemodialysis – ESRD 6 Xcorporeal Hospital Hemodialysis Device • Truly portable device – Smaller (< two cubic feet) and lighter than competitor devices (30-40 lbs) – Reduced fluid (dialysate) requirement – Easier to operate, reduced training requirement • Fully functional – Continuous Renal Replacement Therapy (CRRT) – Intermittent Hemodialysis • Product status – Functional prototype undergoing bench testing – FDA 510(k) filing expected in Q4, 2008 7 Xcorporeal Proprietary Disposable Manifold • The complexity of setting up a dialysis machine has been reduced to insertion of a proprietary manifold into the machine • This reduces machine size, disposable cost, and simplifies operation 8 Benefits of Xcorporeal Hospital Hemodialysis Device • Decrease workload for hospital ICU staff – No plumbing requirements • Use simple tap water versus bagged dialysate – Simple to use operator interface – Snap-in disposable unit – Simple set-up, tear down and clean-up • Cost effective – Decrease in medical staff time (nurse, pharmacist) – Decrease in staff training downtime – No need for bagged dialysate ($180/treatment) • Flexibility – Truly portable, no utility hookup limitations 9 Hospital Hemodialysis Device Development Timeline Q1 Q2 Q3 2008 10 Q4 Q1 Q2 2009 Hospital Hemodialysis Device Market • US Market Opportunity = $1.1 billion – Growing at 10% per year • Aging Population • Increasing severity of hospitalized patients • Disposable Market – – – – 242,000 patient hospitalizations per year estimated 2008 Average 8 days per hospitalization $500 revenue per day for fluids and disposables Disposable Market = 242,000 x 8 x $500 = $968 million • Device Market – 2008 Market = $150 million 11 Xcorporeal Home Hemodialysis Device • Truly portable device – Smaller (< two cubic feet) and lighter than competitor devices (30-40 lbs) – Reduced fluid requirement – Easier to operate, reduced training requirement – No special plumbing nor electrical requirements • Fully functional – Wide range of flow rates – treat larger patients • Product status – Working prototype – FDA 510(k) expected filing in Q3, 2009 12 Benefits of Xcorporeal Home Hemodialysis Device • Truly portable – Substantially smaller and lighter than any existing device – No utility requirements, tap water and wall power only • Ease of Use – 6 liters of regenerated dialysate; no need to handle large volumes of dialysate – Fully disposable fluid circuit, no cleaning or sterilization – 50 – 600 ml / minute range of flow rates • Ease of Treatment – One step, one-handed set up – Graphical user interface 13 Home Device Development Timeline Q1 Q2 Q3 2008 14 Q4 Q1 Q2 2009 Chronic Hemodialysis Market • U.S. Market Opportunity = $6.7 billion – – – – 357,000 chronic dialysis patients 3 treatments per week $120 Medicare reimbursement / treatment Market = 357,000 x 3 x $120 x 52 weeks = $6.7 billion • Home hemodialysis penetration is less than 1% today but will grow because – Appropriate equipment becomes available (Xcorporeal, NxStage, Fresenius off label) – Longer, more frequent therapy is better medicine (4+ treatments per week versus 3) – Home hemodialysis reduces capital and skilled labor requirements 15 Home Hemodialysis is a significant Growth Opportunity in ESRD • Patient Benefits – Increased time on hemodialysis with improved outcomes – Potential for daily dialysis – Improved quality of life: diet, sleep, time • Provider Benefits – Decreased need for nurses/techs – Increase in revenues without need for additional infrastructure – More frequent treatments decreases need for expensive medications 16 Home Hemodialysis Device Comparison Renal Solutions (*) NxStage Fresenius 2008K 150 - 400 50 - 600 20 - 600 50 – 500 6 Yes < 40 200 - 400 50 - 200 100 - 800 6 20 - 30 120 Yes No No 195 80 160 16 5 16 No Partial No Drainage Required < 2.0 Yes No No Yes Yes Installation Cost Low Medium Medium High Blood Flow Rates Dialysate Flow Rates Dialysate/4-hr (liters) Dialysate Regeneration Dry Weight (pounds) Size (cubic feet) Portable * Not marketed. 17 Xcorporeal 50 – 600 Xcorporeal Wearable Artificial Kidney • • • • • “Disruptive” technology Wearable, battery operated light-weight device Fully automated, simple to use Prototype tested successfully Successful human trials published in The Lancet & Kidney International December 2007 • 24 hrs/7 days therapy with potential to revolutionize care of ESRD patients 18 Wearable Artificial Kidney Feasibility Prototype 19 Wearable Artificial Kidney Bi Phase Pump Metering Pump Metering Pump Sorbent 3 Heparin Infusate Bubble Sensor Blood Loop Sterile Change weekly in clinic 20 Dialyzer Patient Metering Pump Blood Sensor BiCarbonate Sorbent 2 Sorbent 1 Metering Pump Waste Drain Valve Dialysate Loop Change daily at home Clinical Trial Results • Initial clinical study conducted with a prototype device at The Royal Free Hospital, London – 8 ESRD subjects dialyzed for mean of 6.4 hrs – Clearances of creatinine, urea, and beta-2microglobulin achieved (chart follows) – No adverse events reported – Subjects were able to walk unhindered during dialysis treatment – Presented at ASN November 5, 2007 21 Clinical Trial Results Time (hrs) 0% -5%0:00 2:00 4:00 6:00 8:00 -10% % Change -15% -20% -25% Urea -30% Creatinine -35% Beta2 Microglobulin -40% -45% -50% • Sustained reductions in key blood chemistries • Clearance of both small and middle molecules • Clearance meets or exceeds daily toxin production 22 WAK Development Timeline Q1 23 Q2 Q3 2008 Q4 Q1 Q2 Q3 2009 Q4 Q1 Q2 2010 Q3 Q4 Intellectual Property • Portable Artificial Kidney – 22 patents pending or in process • Wearable Artificial Kidney – Exclusive in-licensed patents • Wearable ultra-filtration device – Wearable, self-contained, device for continuous excess fluid management • Wearable continuous renal replacement therapy device – Expands on patent above to include renal replacement patients and battery-operated power source 24 Selected Financial Information September 30, 2007 • Cash and Marketable Securities - $20.3 million • Shares Outstanding - 14.4 million • Market Capitalization - $41 million at 2/13/08 • $1.2 million monthly cash burn rate 25 Company Near-Term Milestones • Hospital Portable Hemodialysis Device – Functional Prototype (completed) Q4, 2007 – Pre-Production Prototype Q3, 2008 – FDA 510(k) submission Q4, 2008 – Commercialization target Q2, 2009 • Home Portable Hemodialysis Device 26 – Functional Prototype (completed) Q4, 2007 – Pre-Production Prototype Q3, 2008 – Clinical trial Q2, 2009 – FDA 510(k) submission Q3, 2009 – Commercialization target Q4, 2009 Comparable – NxStage Medical (NXTM) • Emerging growth hemodialysis company • “System One” device – Home hemodialysis: > 2,200 patients; <1.0% of market – Hospital CRRT for acute renal failure • Financial Metrics – $288M market capitalization @ 2/13/08 • 6.7x trailing twelve months revenues • 2.4x annualized Q4, 2007 revenues – Quarter ended December 31, 2007 financial highlights • $34.3M in cash (includes $25M debt drawdown) • $17.8M operating expenses • $17.2M operating loss 27 Comparable Acquisition Fresenius purchase of Renal Solutions • $190 million purchase price – $100 million at closing – $60 million in one year, $30 million contingency • Sorbent technology • Allient device – Cleared by FDA over two years ago – Not brought to market • Why significant for Xcorporeal – Suggests sorbent technology valuable – High acquisition price for “scarce” assets 28 Xcorporeal Highlights • Extra-corporeal medical devices that could replace the function of failing or failed organs • Multiple initial products – Portable Hospital Hemodialysis device – Portable Home Hemodialysis device – Wearable Artificial Kidney • First U.S. 510(k) filing anticipated Q4, 2008 • Minimal to low risk strategy – Prototype device tested successfully – Well defined and straightforward regulatory strategy – Well delineated reimbursement codes • Multi-billion dollar and clearly defined markets 29