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(AMEX Symbol: XCR) Presentation January 14, 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 companys 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 Companys periodic reports filed with the Securities and Exchange Commission, available on its website at .,2,Management Team,Terren Peizer Executive Chairman Winson Tang, MD, FACP Chief Operating Officer Victor Gura, MD Chief Medical Officer Robert Weinstein, CPA, MBA Chief Financial Officer,CEO, Chairman & Founder Hythiam Amgen, Vertex, Tularik, Isis, Pacific Capital Grp Cedars-Sinai Med. Cntr, Assoc. Clin. Prof., UCLA Citi Private Equity, Able Labs, GE Capital,3,Selected Board Members,Hans Polaschegg, PhD Dan Goldberger, MSME Kelly McCrann, MBA,Fresenius, Chairman - Extracorp Circ & Infusion Tech Committee Sound Surgical, Glucon, OSI Systems, Optiscan, Nellcor DaVita, PacificCare, KPMG, McKinsey,4,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 Q4, 2008 - FDA clearance expected Q1, 2009 Minimal to low risk strategy Prototype device tested successfully in humans Well defined and straightforward regulatory strategy Well delineated reimbursement codes Multi-billion dollar and clearly defined markets,5,Xcorporeal Renal Replacement Therapy Devices,Portable Hemodialysis Device - Hospital CRRT/Acute Hemodialysis Portable Hemodialysis Device - Home Hemodialysis ESRD Wearable Artificial Kidney - Home Hemodialysis ESRD,6,Xcorporeal Hospital Portable Renal Replacement 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 in Q4, 2008,7,Xcorporeal Proprietary Disposable Manifold,8,The complexity of setting up a dialysis machine has been reduced to a single step of inserting a proprietary manifold into the machine. This reduces machine size, disposable cost, and simplifies operation.,Benefits of Xcorporeal Hospital Portable Renal Replacement 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,Portable Device Development Timeline,Q1 Q2 Q3 Q4 Q1 Q2 2008 2009,Full Product Specification - COMPLETE,Functional Prototype - COMPLETE,Bench Testing,Industrial Design Prototype,Pre-Production Prototype,Verification & Validation,FDA Submission,10,Hospital Hemodialysis Device Market,US Market Opportunity = $1.4 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 Market = 62,000 beds x .25/bed x $30k/machine = $465 million,11,Xcorporeal Home Portable Renal Replacement Device,12,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) filing in Q2 2009,Benefits of Xcorporeal Home Portable Renal Replacement Device,Truly portable Substantially smaller and lighter than any existing device No utility requirements, tap water and 110VAC only Ease of Use No fluid handling device 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 Use Development Timeline,Q1 Q2 Q3 Q4 Q1 Q2 2008 2009,Full Product Specification - COMPLETE,Functional Prototype - COMPLETE,Bench Testing,Industrial Design Prototype,Pre-Production Prototype,Verification & Validation,FDA Submission,Clinical Trial,14,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,17,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,Waste,Infusate,Heparin,Bi- Carbonate,Sorbent 3,Sorbent 2,Sorbent 1,Bi Phase Pump,Dialyzer,Bubble Sensor,Blood Sensor,Metering Pump,Metering Pump,Metering Pump,Metering Pump,Patient,Blood Loop Sterile Change weekly in clinic,Dialysate Loop Change daily at home,Drain Valve,Wearable Artificial Kidney,20,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-2-microglobulin 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,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 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2008 2009 2010,Feasibility Prototype - COMPLETE,Feasibility Studies - COMPLETE,Second Generation Prototype,Longer Duration Feasibility Studies,Pre-Production Prototype,Clinical Trial,23,Intellectual Property,Portable Artificial Kidney 18 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 - $72 million at 12/31/07 $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 Functional Prototype (completed) Q4, 2007 Pre-Production Prototype Q3, 2008 Clinical trial Q2, 2009 FDA 510(k) submission Q3, 2009 Commercialization target Q4, 2009,26,Comparable NxStage Medical (NXTM),Emerging growth hemodialysis company “System One” device Home hemodialysis: 2,000 patients; 0.5% market Hospital CRRT for acute renal failure Financial Metrics $560M market capitalization 12/31/07 14x trailing twelve months revenues 9x annualized Q3, 2007 revenues Quarter ended September 30, 2007 financial highlights $33M in cash $13M operating expenses $16.1M 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 Q4, 2008 - FDA clearance expected Q1, 2009 Minimal to low risk strategy Prototype device tested successfully in humans Well defined and straightforward regulatory strategy Well delineated reimbursement codes Multi-billion dollar and clearly defined markets,29,APPENDIX,30,Management Team,Nina Peled, PhD, MBA SVP - Quality & Regulatory James Braig, MSME SVP - Product Dev. Barry Fulkerson VP