Nuwellis, Inc. – What You Need to Know

Thinking about investing in Nuwellis? Before you commit your money, let’s break down what this company does and the details of their latest, complex stock offering. Use this guide to decide if this company fits your portfolio.

1. What does this company do?

Nuwellis is a medical device company focused on "fluid management." Patients with severe heart or kidney issues often struggle to remove excess fluid, which builds up in their lungs and makes breathing difficult. Nuwellis makes a machine called the Aquadex. It acts like a gentle filter to remove extra fluid from the blood, a process known as ultrafiltration.

2. How do they make money?

They use a "razor and blade" business model:

• The Hardware: They sell or lease the Aquadex console.
• The Consumables: For every treatment, the hospital must buy a disposable blood circuit kit from Nuwellis.

The Growth Challenge: Nuwellis is in a "growth phase." They spend heavily on marketing and training to convince doctors to use their machine instead of standard water pills. Their revenue depends entirely on hospitals buying these disposable kits.

3. What’s happening with this new offering?

Nuwellis is raising cash by selling common stock and warrants.

• The Price: The combined price for one share (or pre-funded warrant) and one accompanying warrant is $0.30.
• The Warrants: These give the buyer the right to purchase more shares later at a set price.
• The Catch: These warrants require shareholder approval. If the company cannot get enough votes to increase the number of authorized shares, the warrants may not be usable. This could limit their value to you.

4. What are the main risks?

This is a high-risk investment. Beyond their financial struggles, consider these operational hurdles:

• Regulatory & Legal Risks: The FDA strictly regulates medical devices. Nuwellis must avoid promoting their products for uses not approved by the FDA. Violations could lead to massive fines or exclusion from Medicare and Medicaid, which are vital revenue sources.
• International Hurdles: They sell globally and are responsible for their foreign distributors. If a distributor breaks anti-corruption laws, Nuwellis faces legal and financial liability.
• Acquisition Risks: Growing by buying other companies is a gamble. In 2017, they took a $4 million charge related to past acquisitions, which directly reduced their assets.
• Customer Concentration: Their top ten customers provided about 58% of their revenue for the three months ending March 31, 2025. Losing even one major hospital system would hurt their financial results.
• "Going Concern" Warning: Their auditors have expressed doubt about the company’s ability to stay in business. They must raise more cash to keep operating. If they fail, they may have to shut down.
• Constant Losses: As of March 31, 2025, they had an "accumulated deficit" of $301.8 million. They consistently lose money and have negative cash flow.
• Dilution: Because they frequently sell new shares to fund operations, they issue more stock, which reduces your ownership percentage and the potential earnings for each share you own.

5. Who's running the company?

CEO Nestor Jaramillo Jr. leads the company, which is based in Eden Prairie, Minnesota.

6. Where does it trade?

Nuwellis trades on the NASDAQ under the ticker NUWE.

A final piece of advice: This is a "micro-cap" stock, meaning it is highly volatile. The company is fragile and relies on constant fundraising to stay afloat. Before you buy, ask yourself if you are comfortable with the high probability of further dilution and the company's ongoing struggle to reach profitability. Never invest money you cannot afford to lose. Always read the official "Prospectus" for full details.

Disclaimer: I am an AI, not a financial advisor. This guide is for informational purposes only and does not constitute financial advice. Always do your own research before investing.