Us Global Life Sciences Conference -presentation

UBS Global Life Sciences Conference September 22, 2009

| 2009 NxStage Medical Investor Presentation | Confidential

Safe Harbor This presentation contains certain “forward-looking” statements. These statements are based on the current estimates and assumptions of the management of NxStage Medical, Inc. (or “NxStage” or “the Company”) as of the date of this presentation and are naturally subject to uncertainty and changes in circumstances. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Actual results may vary materially from the expectations contained herein. When used herein, the words “may”, “will”, “should”, “could”, “would”, “plan”, “anticipate”, “believe”, “estimate”, “intend”, “project”, “potential” and “expect” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements are subject to risks, uncertainties, assumptions and other factors that may cause the actual results of NxStage to be materially different from those reflected in such forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, among others, those set forth under the headings “Cautionary Note Regarding Forward-Looking Statements”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Quarterly Report on Form 10Q for the quarter ended June 30, 2009. Except to the extent required by applicable securities laws, NxStage is not under any obligation to (and expressly disclaims any such obligation to) update its forward-looking statements, whether as a result of new information, future events, or otherwise. All statements contained in this presentation are made only as of the date of this presentation. The Company discloses certain non-GAAP financial measures to supplement the Company's consolidated financial statements presented on a GAAP basis. These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States and may be different from similar non-GAAP financial measures used by other companies. The non-GAAP financial measures disclosed by the Company are not meant to be considered superior to, or a substitute for, results of operations prepared in accordance with GAAP. Management uses Adjusted EBITDA (EBITDA adjusted for stock based-compensation, deferred revenue recognized, and other non-recurring expenses) , and Adjusted Income to understand operational cash usage. The Company believes this and other non-GAAP financial measures provide useful and supplementary information allowing investors greater transparency to this measure used by management. These non-GAAP financial measures are meant to supplement, and to be viewed in conjunction with, GAAP financial measures. A reconciliation to the most comparable GAAP financial measure s can be found within the Company’s second quarter financial press release dated August 5, 2009 at www.nxstage.com/ir.cfm.

2 | 2009 NxStage Medical Investor Presentation | Confidential

FOUNDER, PRESIDENT AND CEO

JEFFREY BURBANK

| 2009 NxStage Medical Investor Presentation | Confidential

About NxStage • Leading provider of innovative solutions for renal care within Home, Critical Care and In-Center Markets. •

Founded in 1998.

•

IPO in 2005.

•

NASDAQ: NXTM

• Headquarters in Lawrence, MA, USA. •

Design centers in Germany, Italy and Mexico.

•

Distribution partner in UK.

• Annual revenue of $128.8M (2008).

4 | 2009 NxStage Medical Investor Presentation | Confidential

System One ®

Investment Highlights • Established leader within estimated $1Billion home hemodialysis market. • Transformational technology delivers enhanced quality of life, clinical and economic benefits. • Continued growth and leverage supported by strong, existing infrastructure in critical care and in-center markets.

• Solid business fundamentals and improving financials. • Early stages of international expansion.

• Strong and experienced management team.

5 | 2009 NxStage Medical Investor Presentation | Confidential

$1.6B US Market Opportunity*: Pioneering the Home Hemodialysis Market

$100M

$500M

$1Billion (Represents 10-15% of ESRD Population)

US ESRD Market:1  350,000 Patients with ESRD  3-5% CAGR  85% Medicare/Medicaid15% Private Pay

0.7%

7%

Prevalence of ESRD Patients by Treatment Modality1 Center HD PD

92%

Home

In-Center

Critical Care

*NXTM’s estimate of potential U.S. product market size for each of the three markets. 6 | 2009 NxStage Medical Investor Presentation | Confidential

NxStage HHD

1

USRDS Annual Data Report 2008 (citing 2006 data, excluding transplants.)

Rethinking the Dialysis Paradigm Daily Home Hemodialysis with the NxStage System One™ Technical Innovation

Therapeutic Flexibility

7 | 2009 NxStage Medical Investor Presentation | Confidential

Clinical Benefits

Economic Benefits

Leveraging Technical Innovation For Patient Freedom PrismaFlex

In the Home

2008K@HOME Hemodialysis System

System One™

PureFlow™ SL Aksys PHD System

…or on the Road

Allient® Sorbent Hemodialysis System

System One™ 8 | 2009 NxStage Medical Investor Presentation | Confidential

Technical Innovation

Therapeutic Flexibility

Clinical Benefits

Economic Economic Benefits Benefits

Enabling Therapeutic Flexibility

Home

Home

• Nocturnal* every other day

In-Center • 3x a week

• Nocturnal* Daily

Home

Home

• Every other day

• Short Daily

*There are currently no systems specifically indicated for nocturnal hemodialysis. NxStage is currently undergoing an FDA IDE Clinical Trial for this specific indication. Slide is intended to show therapeutic flexibility and does not present any claims pertaining to any therapy’s ability to achieve normal kidney function. 9 | 2009 NxStage Medical Investor Presentation | Confidential

Technical Innovation

Normal Kidney Function

Therapeutic Flexibility

Clinical Benefits

Economic Benefits

Achieving Superior Clinical Outcomes NxStage daily home hemodialysis (HHD) achieves greater than 50% reduction in mortality.1 Overall USRDS Peritoneal Dialysis (PD) >50% Reduction

NxStage Daily HHD 0

5

10

15

20

25

Death Per 100 Patient Years Source: NxStage analysis (1/2006 through 10/2007); PD literature (Guo, Mujais KI 2003 and 2006); 2007 USRDS Annual Report. *Calculated NxStage age and gender adjusted SMR is approximately 50%, based on analysis of over 2,000 NxStage patients across more than 330 centers.

Technical Innovation 10 | 2009 NxStage Medical Investor Presentation | Confidential

Therapeutic Flexibility

Clinical Benefits

Economic Benefits

Fewer Complications The health benefits of more frequent hemodialysis have been reported to be significant for a number of complications: Clinical Benefits

Source: Analysis of 94 original published articles published since 1996. See “Benefits of Daily Dialysis” booklet (NxStage, 2005) 11 | 2009 NxStage Medical Investor Presentation | Confidential

Technical Innovation

Therapeutic Flexibility

Clinical Benefits

Economic Benefits

Reducing the Cost of Care: Decreasing Drug Utilization: Patients who switched to daily HHD had a nearly 50% reduction in the number of blood pressure medications prescribed.1 Economic Benefits Number of Prescribed Anti-Hypertensive Meds Per Patient1 1.7

1.8

p< 0.0001

1.4

% of Patients Prescribed No Anti-Hypertensive Medications1 50% 45%

p< 0.002

47%

40%

1.6

1.3

1.4

35%

1.3

1.2

1.0

1.0

1.3

25%

0.8

20%

0.6

15%

0.4

10%

0.2

5%

0.0

39%

30%

21%

0% Baseline

Month-4

Month-12

1 Jaber

BL, et al. Daily hemodialysis (DHD) reduces the need for anti-hypertensive medications. Abstract presentation at the American Society of Nephrology 2009 Annual Congress.

Baseline

Technical Innovation

Month-4

Therapeutic Flexibility

Clinical Benefits

12 | 2009 NxStage Medical Investor Presentation | Confidential ©NxStage Medical Inc. 2009

Month-12

Economic Benefits

Improving Quality of Life: NxStage FREEDOM Study Data 30% reduction in DEPRESSIVE SYMPTOMS1

6 to 17% improvement in health-related QUALITY OF LIFE measures1

35% reduction in typical weekly total dialysis care time commitment,** resulting in regaining roughly a waking day per week, or 52 days per year, of QUALITY TIME2 Source: 1 Finkelstein F, et al. Daily hemodialysis improves depressive symptoms at 12 months of follow-up: Interim results from the FREEDOM study. Hemodialysis International. 2009: 13:1: 111. Presented as an abstract at the 2009 Annual Conference on Dialysis.. 3 The FREEDOM Study: Important outcomes data for your dialysis patients. Comparative treatment times. APM325, Rev B. p3.

13 | 2009 NxStage Medical Investor Presentation | Confidential

More than 85% reduction in post-treatment RECOVERY TIME1

Technical Innovation

Therapeutic Flexibility

Clinical Benefits

Economic Benefits

Building Momentum… With Thousands of Patients…

And Through Millions of Treatments.



Over 85% of NxStage patients surveyed report that they chose HHD for the health, freedom and control benefits it offers.1





89% of NxStage patients surveyed are “Highly Likely” to recommend HHD to a patient who is considering it.1

A recent survey showed that 92% of NxStage prescribing physicians and 86% of non-NxStage prescribers would choose home dialysis for themselves.2



In a nephrologist and nurse survey, 77% of respondents chose home/more frequent dialysis as the best long-term therapy for the majority of patients.3

1

Chadwick Martin Bailey. NxStage Home Hemodialysis Patient Research. October, 2008. Pg. 1-44. Healthcare Research Consulting Group. NxStage Report. July 28, 2009. p. 1-64. 3Ledebo I and Ronco C. The best dialysis therapy? Results from an international survey among nephrology professionals. Nephrol Dial Transplant Plus. 2008; 6:403408. 2

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Driving Adoption Growth Drivers for Adoption  Reimbursement  Clinical Support  “Going Deep”  Product

15 | 2009 NxStage Medical Investor Presentation | Confidential

Home Market Highlights  CMS’s Proposed “Bundled” Payment. − NxStage will be focused on improving training reimbursement.  Home revenue increased 28% in

Q209 vs. Q208.  Increased centers >10 patients to 99

in Q209.  Increased markets with > 5%

penetration by 79% in Q209 vs. Q208.

$16 $14 $12 $10 $8 $6 $4 $2 $0

In Millions

Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109 Q209

 Increased # of prescribing doctors by

24% in Q109 vs. Q208. 16 | 2009 NxStage Medical InvestorSecond Presentation | Confidential Source: NxStage Medical Quarter 2009 Financial Results Conference Call on August 5, 2009.

Home Revenue

Critical Care Highlights • Respected leader in CRRT since 2003. – –

Represent an estimated 25% of installed critical care dialysis machines in US. Customers include 7 of top 10 leading renal care hospitals in US (US News & World Report 2008).

• Strong, differentiated value proposition. • Continue to expand market presence. –

Market Opportunity* $100M

$500M

$1B

Increased revenues 20% in Q209 vs. Q208.

• Strategic to overall growth and profitability. –

Predictable, recurring revenue stream. •

–

Approx. 80% of revenue is disposables based.

Home

In-Center

Critical Care

Machine sales contribute to cash flow. *NXTM’s estimate of potential U.S. product market size for each of the three markets.

17 | 2009 NxStage Medical Investor Presentation | Confidential

In-Center Highlights •

Established leader since 1993. (Acquired in 2007.) – –

#1 Market Share Leader in US AVF Needle Market.1 #2 Market Share Leader in US Bloodline Market.1

• Innovative, value- added products. • Manufacturing scale. –

Market Opportunity* $100M

$500M

$1B

Leverage to further reduce COGS, increase capacity and improve efficiency.

• Strategic channel opportunities. –

Expand market reach across all three markets.

1

Manufacturers’ public disclosures, NXTM actual results & competitive estimates for 2008. 18 | 2009 NxStage Medical Investor Presentation | Confidential

Home

In-Center

Critical Care

*NXTM’s estimate of potential U.S. product market size for each of the three markets.

New Strategic Business Agreements

19 | 2009 NxStage Medical Investor Presentation | Confidential

Financial Highlights: Rapid Revenue Growth

$140

$128.8

$120 Millions

$100 $80

$60.0

$60 $20.8

$40 $20

$6.0

$0 2005

2006 System One

2007 *

2008

In-Center

*Reflects the impact of the Company’s acquisition of Medisystems, the Company’s in-center business, in October, 2007. | 2009 NxStage Medical Investor Presentation | Confidential

Improving Gross Margins and Adjusted EBITDA

Adjusted EBITDA (Loss)*

Gross Margin ($M)

30%

24%

25%

20%

20%

13%

15%

14%

21%

$0

($5)

16%

-3.4

($10)

10% 5%

($15)

2% Q4FY07

Q1FY08

Q2FY08

Q3FY08

Q4FY08

Q1FY09

-7.7

Q1FY08

Q2FY08

Q3FY08

-6.0

-5.7

Q4FY08

Q1FY09

-11.7 Q4FY07

0%

-8.3

-7.3

Q2FY09

Q2FY09 *Non-GAAP Measure: Excludes depreciation and amortization, stock-based compensation, deferred revenue recognized and other non-recurring expenses. A reconciliation to the most comparable GAAP financial measure can be found within the Company’s second quarter financial press release dated August 5, 2009 at nxstage.com/ir.cfm.

21 | 2009 NxStage Medical Investor Presentation | Confidential

Key Financial Matrix In Millions Q2FY08

Q1FY09

Q2FY09

Q3FY09 Guidance*

$32.5-$34.51

Revenue

$31.6

$33.7

$36.4

Gross Margin

14%

21%

24%

Net Income (Loss)

$(12.5) Adj. $(14.6)2

$(12.2)

$(12.5) $(10.0)Adj. $(10.5)3 $(11.0)

Adj. EBITDA (Loss)4

$(7.7)

$(5.7)

$(3.4)

$(3.0)-$(4.0)

* Q3FY09 Guidance provided on August 5, 2009 within Company’s second quarter financial press release at nxstage.com/ir.cfm. 1 Estimate includes the impact of $2.0mm in In-Center shipments being pushed from Q3 to Q4FY09. 2 Non-GAAP Measure: Excludes a $2.1mm benefit related to a change in fair value of financial instruments. 3 Non- GAAP Measure: Excludes the impact of $2.0mm in charges related to terminating the Company’s GE Credit facility. 4 Non-GAAP Measure: Excludes depreciation and amortization, stock-based compensation, deferred revenue recognized and other non-recurring expenses. 22 | 2009 NxStage Medical Investor Presentation | Confidential

Thank you!

Questions?

| 2009 NxStage Medical Investor Presentation | Confidential