Xcorporeal Announces Filing of Form 10-K and 2008 Operational Highlights

As a result of the Company's current financial condition reflected in its financial statements included in the 10-K, the Company's auditors expressed substantial doubt about Xcorporeal's ability to continue as a going concern. In the view of the Company's management, the Company's ability to continue as a going concern is substantially dependent on the successful execution of many of the actions referred to below, on the timeline contemplated by its plans and the Company's ability to obtain additional financing.

Some of the operational highlights for 2008 include:

-- Announcement of new prototype. The Company launched the XCR-6 Dialysis Platform for self-directed kidney hemodialysis. The XCR-6 is anticipated to be the smallest, lightest, and easiest to use dialysis machine, using Xcorporeal's proprietary closed loop, regenerated dialysate technology platform. The Company is preparing for unattended/home use clinical trials of the XCR-6 in anticipation of future commercialization. The XCR-6 was developed through extensive research and represents a significant improvement compared with equipment currently utilized by patients suffering from chronic renal failure. The Company estimates that the home hemodialysis market represents a multi-billion dollar revenue opportunity.

-- Appointment of a new Chairman and Chief Executive Officer. The Company named Kelly McCrann to each position. Mr. McCrann is a senior healthcare executive with extensive experience in board governance, strategic leadership, profit and loss management and strategic transactions. He was recently Senior Vice President of DaVita Inc. (NYSE: DVA), a leading provider of kidney care services in the United States, where he was responsible for all home-based renal replacement therapies for the United States' second largest kidney dialysis provider.

"We believe the recent cost reduction activities we completed will allow the Company additional time to complete one or more strategic transactions with potential partners," said Mr. McCrann. "We have significantly reduced our cash utilization, and in addition to the preliminary discussions we have held with potential strategic partners, we are focusing our efforts in commercializing our Portable Artificial Kidney (PAK), which represents the device that is most cost-effective and furthest along in development."

On March 13, 2009, the Company announced a cost reduction program under which it terminated the employment of 19 employees, or approximately 73%. The layoffs and other efforts focused on streamlining our operations through a series of initiatives designed to reduce annual expenses by approximately $3.5 million to a current operating burn rate of approximately $200,000 per month. In conjunction with these efforts, the Company announced that it was focusing its development activities on the PAK, and was exploring various strategic alternatives, which may include the license of certain intellectual property rights as a means to further develop its technologies, among other possible transactions and alternatives.

About Xcorporeal, Inc.

Xcorporeal, Inc. is a medical device company developing an innovative extra-corporeal platform technology to be used in devices to replace the function of various human organs. The platform leads to three initial products: a Portable Artificial Kidney (PAK) for hospital based Renal Replacement Therapy, the XCR-6 for home hemodialysis, and a Wearable Artificial Kidney (WAK) for continuous ambulatory hemodialysis.

For the hospital market, Xcorporeal is developing a portable, multi-functional renal replacement device that will offer cost-effective therapy for those patients suffering from Acute Renal Failure, which causes a rapid decline in kidney function. In the U.S., the disease affects more than 200,000 patients annually with a mortality rate approaching 50%, according to a study published in the Clinical Journal of American Society of Nephrology in 2006. The Company has completed functional prototypes of subsystems, which are currently undergoing bench testing.

The Company also plans to commercialize the XCR-6, a home hemodialysis device, for the chronic End Stage Renal Disease (ESRD) market, comprised of patients in whom the kidneys have ceased to function. The Company's devices are intended to combine the best attributes of currently marketed home hemodialysis machines to offer patients convenient, durable and truly portable treatments at home. The Company believes its devices will provide a cost-effective alternative to current home treatment modalities, due to their ability to offer hemodialysis without the need for large quantities of dialysate fluid or purified water. The Company has also completed a demonstration prototype of the XCR-6.

The Company's WAK is also a device for the chronic treatment of ESRD. The Company has successfully demonstrated a prototype system that weighs less than 6 kg., is battery operated, and can be worn by an ambulatory patient. This miniature, wearable device is intended to enable continuous (up to 24 hours x 7 days per week) renal replacement therapy at home. Increasing dialysis time has previously been shown to reduce morbidity and improve quality of life of ESRD patients. The WAK has been featured in articles written in periodicals worldwide such as the Los Angeles Times, Le Figaro, Frankfurter Algemeiner and Corriere dela Sera. Scientific papers discussing the WAK have been published in several peer reviewed journals, including The Lancet and Kidney International.

Additional Company information may be found on its website at: www.xcorporeal.com.

Forward-Looking Statements

Except for statements of historical fact, the matters discussed in this press release are forward looking and made 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 risks 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, the risk that we may not have sufficient financial resources to adequately finance the development activities described in the press release, uncertainty as to the outcome of arbitration and legal proceedings, intense competition and substantial regulation in the medical device industry, and additional risk factors as discussed in the reports filed by the Company with the Securities and Exchange Commission, which are available on its website at http://www.sec.gov.

SOURCE: Xcorporeal, Inc.

Investor Relations: 
Xcorporeal, Inc. 
Robert Weinstein 
Chief Financial Officer 
310-923-9968 
IR@xcorporeal.com 
or 
Public Relations: 
Dan Klores Communications 
Tim Sullivan 
212-981-5234 
tim_sullivan@dkcnews.com