Nephros, Inc. (Nasdaq: NEPH)Investor PresentationApril 2020

Safe Harbor Statement

Certain statements in this management presentation constitute “forward-looking statements.” Such statements include those regarding the efficacy and intended use of our technologies under development, the timelines and strategy for bringing such products to market, the availability of funding sources for continued development of such products, and other statements that are not historical facts, including statements that may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Forward-looking 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 our control. Actual results may differ materially from the expectations contained in the forward-looking statements. Factors that may cause such differences include, but are not limited to, that (i) we face significant challenges in obtaining market acceptance of our products, which could adversely affect our potential sales and revenues; (ii) product-related deaths or serious injuries or product malfunctions could trigger recalls, class action lawsuits and other events that could cause us to incur expenses and may also limit our ability to generate revenues from such products; (iii) we face potential liability associated with the production, marketing and sale of our products, and the expense of defending against claims of product liability could materially deplete our assets and generate negative publicity, which could impair our reputation; (iv) to the extent our products or marketing materials are found to violate any provisions of the U.S. Food, Drug and Cosmetic Act (the “FDC Act”) or any other statutes or regulations, we could be subject to enforcement actions by the U.S. Food and Drug Administration (the “FDA”) or other governmental agencies; (v) we may not be able to obtain funding if and when needed or on terms favorable to us in order to continue operations; (vi) we may not have sufficient capital to successfullyimplement our business plan; (vii) we may not be able to effectively market our products; (viii) we may not be able to sell our water filtration products or chronic renal failure therapy products at competitive prices or profitably; (ix) we may encounter problems with our suppliers, manufacturers and distributors; (x) we may encounter unanticipated internal control deficiencies or weaknesses or ineffective disclosure controls and procedures; (xi) we may not be able to obtain appropriate or necessary regulatory approvals to achieve our business plan; (xii) products that appeared promising to us in research or clinical trials may not demonstrate anticipated efficacy, safety or cost savings in subsequent pre-clinical or clinical trials; (xiii) we may not be able to secure or enforce adequate legal protection, including patent protection, for our products; and (xiv) we may not be able to achieve sales growth in key geographic markets. More detailed information about us and the risk factors that may affect the realization of forward-looking statements, including the forward-looking statements in this management presentation, is set forth in our filings with the SEC, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and our other periodic reports filed with the SEC. We urge you to read those documents free of charge at the SEC’s web site at www.sec.gov. We do not undertake to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law.

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Our Vision & Mission

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Debris Retained Product Water Delivered

The DSU-H is FDA Cleared (bacteria & virus) to aid in infection control

for up to 180-days

Nephros provides innovative and superior technologies that provide safe water solutions, delivered to our customers with unparalleled quality, reliability and service.

Nephros: Three Business Segments

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Established and growing water filtration base business plus a recently launched pathogen detection productand potentially transformative dialysis device to be launched in 2020

Water Filtration

§ 100% of historical revenue

§ Recurring revenue: razor / razor blade model

§ High gross margins (55-60%)

§ Cash flow breakeven

§ Impressive revenue growth: 62% average growth YoY for 15 consecutive quarters

§ Growing end-markets: hospitals, hospitality / food service, dialysis

Leading provider of ultrafilters to protect from waterborne pathogens

Pathogen Detection (PluraPath™)

Growing Base Business New Product Line Launches

HDF Dialysis

§ $8 billion highly fragmented global market§ Real-time data (results in 1 hour)§ 15 different assays simultaneously§ DialyPathTM and SequaPathTM in the pipeline

§ Targeting 2020 relaunch§ Over 15% of patients on

HDF in Europe

Mobile qPCR water-borne pathogen detection system

Enables hemodialysis machine to perform hemodiafiltration

treatment

Daron Evans, MS, MBAPresident & CEO• CFO Nile Therapeutics, Inc. (now CAPR)• J&J, Arthur D. Little, Booz Allen & Hamilton• MBA Duke, BS Chem Eng, MS Biomed Eng

Andy Astor, MBACOO & CFO• President/CFO, OpenSCG (acquired by AMZN)• Founder/CEO EnterpriseDB, VP Asurion, VP D&B, EY• MBA Wharton, BA Mathematics Clark University

Michael MilmanVP Research & Development• 10+ years Nephros, 15+ years design and dev.• R&D engineer with Stryker• BS Mechanical Engineering, Lehigh University

Vashone ThomasVP Quality and Regulatory• Previously Integrated Dental Systems• 10+ years quality leadership• MS Pace University

Shane SullivanVP Sales• Nephros 7+ years• 10 years Regional Manager at Thermo Scientific• BS Business, USC

• Molecular genetics, pathogen detection, food safety• Professor of Microbiology/Epidemiology, U Nevada • PhD Epidemiology

Kimothy SmithVP Pathogen Detection Products

Greg LucasPresident, Aether/Commercial• Founder/Owner Biocon/Aether Water Systems• Executive at Gallo Wines

Monet CarnahanVP Dialysis Products• Expert in Dialysis Technologies• Renal Care Perf. Improvement at Fresenius• 10+ years as Registered Nurse

Management Team

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Water Filtration

What Does a Nephros Ultrafilter Do?

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§ Nephros Ultrafilters protect patients and consumers from water-borne pathogens

Debris Retained Product Water Delivered

The DSU-H is FDA Cleared (bacteria & virus) to aid in infection control

for up to 180-days

Actual Backwash of a Nephros Ultrafilter After 6 Months

Nephros Ultrafilters stop all bacteria, viruses,

endotoxins

Nephros Proprietary Membrane Technology

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NephrosUltrafilters

(0.005 μm pore size)

Conventional Microfilters

(0.2 μm pore size)

Endotoxins

Bacteria

Nephros ultrafilter pore size: 40x smaller than conventional filters

Viruses

§ Conventional microfilters can stop most, but not all bacteria and are insufficient in filtering virusesand endotoxins

3 – 28xcompetitor

Nephros Proprietary Membrane Technology

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Nephros filters dramatically improve performance at a smaller cost per day vs. conventional filters

§ Nephros’ proprietary membrane technology offers smallest pore size without compromising flowrate and filter life

KEY FEATURES IN WATER FILTERS

Filtration(Pore Size)

Filter Life

Flow Rate(Membrane Surface Area)

LEADING COMPETITOR* NEPHROS

0.2 μm 0.005 μm40x

Smaller Pore Size

31-62 days 90 – 360 days 2 – 3x competitor

0.3-2.8 m2 0.06-0.1 m2

* versus Pall AquaSafe

Multiple Competitive Advantages

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1. Intended to be used to filter EPA quality drinking water; retain bacteria, viruses and endotoxin; provide ultrapure water for patient washing and drinking; produce water suitable for wound cleaning, cleaning of equipment used in medical procedures and washing of surgeon’s hands; not intended to provide water that can be used as a substitute for USP sterile water

Pall-AquasafeTM Nephros Filters

Pore Size 200nm 5nm

Filter Life Up to 31-62 days Up to 90-360 days

Number / Year 6-12 Change-outs 1-4 Change-outs

Flow Rate Comparable

Cost per Day Comparable

Regulatory Two productsFDA 510(k) cleared

All productsFDA 510(k) cleared

Sales ModelDirect sales, plus partnered with

Nalco

Distributor model: Garrett-Callahan,

Chem-Aqua, HOH, TQM, Others

DSU-HHydraGuard™

S100

SSU-H

§ Multiple competitive advantages vs. the leading competitor

Clinics

Total Addressable Market Over $1 Billion

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1) Based on the number of potential filtration sites in US hospitals multiplied by $2/day2) Based on internal estimates

~6,200 U.S. Sites

15%

% of Sites w/ NEPH Filters(2)

$400M

TAM(1)

620,000 Filters

Total Filters

20%

Penetration

1.24M Beds

BedsHospitals

50,000+ U.S. Sites

<1%

% of Sites w/ NEPH Filters

$500M+

TAM

3M+Filters

Total FiltersCommercial

~6,900 U.S. Sites

~5%

% NEPHFilters

$20M

TAM

30,000Filters

Total Filters

100%

Penetration

10,000

RO Machines

Hospitals

Dialysis

Commercial

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§ Sell through leading water management service companies

§ Utilize national and regional distributors

§ Minimal direct sales

§ Highly leveraged, asset-light model enables low cost of sales and high margins

Sales & Distribution Strategy

Pathogen Detection

§ June 2017: CMS mandates all healthcare facilities have a water management plan. Mandaterequires:

a) Healthcare facilities must have a plan

b) Plan must be enforced and water must be tested

c) Must take action if pathogens are detected

1. Install filters

2. Chemical cleanse (chlorine, etc.)

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Pathogen Detection: Introducing PluraPath™

Current Nephros Sales

Benefits Assays Include:

1) On-site pathogen detection (no need to ship tolab)

2) Tested by own employees (not lab technicians)

3) Real-time results (in ~1 hour)

4) 15 pathogen panel tested simultaneously witha single water sample

§ Legionella

§ E. coli

§ Pseudomonas

§ Shigella

§ Salmonella

§ Mycobacterium

§ Norovirus

§ Rotovirus

§ Mycobacterium

§ Camylobacter

PluraPath™ Enables Testing

SalesServices and

Products Offered by Water Service

Partners

Pathogen Detection: Introducing PluraPath™

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Performs 15 separate DNA/RNA assays from a 1-liter water sample in approximately 1 hour

Step 1: Collect 1-liter sample into sterile bagStep 2: Concentrate test sample w/ Nephros ultrafilterStep 3: Aliquot concentrate into an 8-well PCR test stripStep 4: Initiate portable real-time thermocycler Step 5: Thermocycler runs automatically for about 30 minutesStep 6: Upload data and review report w/ Nephros Mobile App

Custom Pelican Case for Easy Portability

Portable, Real-time Open Source Thermocycler

§ Nephros uses the same distributors as the filtration businessto market PluraPath™

§ Largely Recurring Revenue

§ Expecting similar margins as the filtration business

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Transformation from a “water filter” company to a“water solutions” company

Additional Pathogen Detection Launches§ Nephros will use its base pathogen detection technology to launch additional detection products

DialyPath™ SequaPath™

§ Dialysis clinics much shut down when contaminated

§ Current standard test (limulus amebocyte lysate(“LAL”)) routinely take over 48 – 72 hours and areshipped to a central laboratory

§ DialyPath™ uses PluraPath™ technology and is ableto test endotoxins in real-time (1 hour)

§ Plan to launch DialyPath™ in Q2 2020

Entry into Dialysis Pathogen Detection

Reduction in time to results

Provide estimate of endotoxin levels equivalent to LAL

Entry into Biome Mapping Services

§ Ability to process 96 samples at once

§ Ability to recognize over 20,000 different bacteriareferences in one day

§ Will offer this product as a service

§ Expected launch in late 2020

Provide estimated levels of 6 gram-negative bacteria

Full building biome map

Provides estimated levels of ANY known bacteria

Specialty Renal Products, Inc. (SRP)

2nd Generation HDF System Design Goals

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• Enable Nephrologists to quickly and easily offer HDF treatment to patients• Provide low capital cost solution vs. new HD/HDF combo machines; • Offer Mid-Dilution HDF technology

OLpūr H2H Module:Converts standard HD Systems to Online HDF

Systems

HDF Assist Module:Converts standard HD Systems to Online HDF

Systems

2nd Gen HDF Project Design Targets:• Reduce set-up/change-over time by 90%• Reduce space requirement by over 80%• Provide disposable filter and tube set• Improve operator ease of use• Reduce HDF system cost by 95%• Eliminate nightly maintenance

Financials

$1,944 $2,320$3,809

$5,687

$10,334

54.5% 55.8%60.2% 56.3% 59.0%

2015 2016 2017 2018 2019Total Revenue Gross Profit Margin

Income Statement Snapshot

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Total Revenue & Gross Profit Margin(1)

($ in Thousands)

(1)

(2)

1) 2019 Total Revenue and Gross Profit Margin are an estimate from management in a 1/6/2020 press release2) 2019 gross profit margin is LTM as of 9/30/2019 (no gross profit margin was given for Q4 in the 1/6/2020 press release)

§ Consistent revenue growth and stable high 50%’s gross profit margin

Income Statement Highlights

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2019Q4 2018Q4 Variance Full Yr 2019 Full Yr 2018 VarianceConsolidated

Revenue 3,161 1,612 96% 10,334 5,687 82%Gross Margin 60% 59% +1 59% 56% +3EBITDA (39) (692) 94% (2,783) (2,890) 4%Adjusted EBITDA 602 (256) 335% (1,010) (1,771) 43%Net Profit/(Loss) (143) (664) 78% (3,179) (3,325) 4%Net CF from Op's 365 (448) 182% (2,276) (3,662) 38%EPS (0.03) (0.10) 75% (0.45) (0.50) 9%

Water FiltrationRevenue 3,161 1,612 96% 10,334 5,687 82%Gross Margin 60% 59% +1 59% 56% +3EBITDA 238 (300) 179% (1,253) (1,980) 37%Adjusted EBITDA 874 136 544% 506 (861) 159%Net Profit/(Loss) 134 (147) 191% (1,648) (2,417) 32%Net CF from Op's 674 8 8331% (658) (3,127) 79%

Balance Sheet & Capitalization Highlights

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Balance Sheet (as of 12/31/19) (Values in 000s)

Cash & Equivalents at 12/31/19 $4,166

1/31/2020 Capital Raise $6,765

Debt

Revolver (8.5% interest) $560 $2.5M capacity, auto renews annually

Secured Note (8.0% interest) $824 Matures 4/1/2023

Net Cash: $9,547

Capitalization Table (as of 4/2/20)

Closing Share Price $6.15

Shares Outstanding 9.0M

Market Cap $55M

Options (WAEP: $5.51) 1.0M

Warrants (WAEP: $3.37) 0.4M

Fully Diluted Shares 10.4M

Appendix

Hospital Infection Control – 510(k) Portfolio

DSU-H & SSU-HIn-Line Filters

(0.005 µm)

HydraGuard™ & HydraGuard™ Flush

(0.005 µm)

6 Month 3 Month3 Month 6 Month 12 Month

S100 Sink & ShowerPoint-of-Use Filters

(0.1 µm)

§ $400 million market opportunity§ Recent addition of Legionella risk prevention to CMS site inspections of hospitals and long-term care

facilities increases focus on infection control

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Commercial Markets: Food Service and Hospitality

SedimentCartridge

Carbon BlockCartridge

Carbon & ScaleCartridge

Scale ControlCartridge

Commercial FiltrationSediment, Taste, Odor, & Scale Control

§ Targeted for food service and industrial customers• Applications include ice machines, sinks and faucets

§ $500 million market opportunity

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DSU-D SSU-D SSU-MiniIn-Line Filters

(0.005 µm)

EndoPur™10” EndoPur™20” EndoPur™30”Replacement Cartridges

(0.005 µm)

12 Month 12 Month 12 Month 12 Month 12 Month12 Month

Dialysis Water – 510(k) Portfolio

§ Filter water or bi-carbonate to assist in hemodialysis§ $20 million market opportunity

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Thank you

Nephros, Inc.380 Lackawanna Place

South Orange, NJ 07079P: 201.343.5202

www.nephros.com

Investor Relations Contacts:

Kirin Smith, PresidentPCG Advisory

ksmith@pcgadvisory.com(646) 823-8656

Andy Astor, COO & CFONephros, Inc.

andy@nephros.com201.345.0824

Thank You