Nuwellis, Inc. (NUWE): Business Model Canvas [Dec-2025 Updated]

You're looking at Nuwellis, Inc. right after their major strategic pivot to focus exclusively on the U.S. market, which is a big deal for a company trying to right-size its operations. Honestly, the Q3 2025 numbers tell a story of intense focus: they pulled in $2.2 million in revenue, with consumables-the recurring money-maker-growing a solid 23% sequentially, which is what we want to see. However, you can't ignore the near-term pressure; that high SG&A spend of $3.5 million to rebuild the sales force, combined with only $3.1 million in cash as of September 30, 2025, means execution on U.S. adoption has to be flawless from here on out. Let's break down the nine building blocks of the Nuwellis, Inc. business model to see exactly how they plan to turn this focused strategy into sustainable profit, so you can make a truly informed read on their path forward.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Nuwellis, Inc. relies on to manufacture, innovate, and get its Aquadex system into the hands of clinicians. These partnerships are crucial, especially given the company's recent focus on U.S. market acceleration and operational streamlining.

KDI Precision Manufacturing for outsourced production and expected cost efficiencies

Nuwellis, Inc. finalized a strategic manufacturing agreement with KDI Precision Manufacturing, effective May 9, 2025, to outsource assembly, aiming to reduce costs and enhance operational efficiency. KDI is an ISO 13485 certified and FDA registered company, with over 80% of its business in healthcare products. This move followed a period where Nuwellis' gross margin was 65.2% in the third quarter of 2025, down from 70.0% the prior year quarter, partly due to unfavorable manufacturing utilization in the first half of fiscal year 2025.

KDI took over assembly for specific Aquadex components. The structure preserved institutional knowledge by hiring Nuwellis' existing assembly employees. KDI reported annual revenue of $8.74 million and a robust gross margin of 66.66% in the context of this announcement.

National Institutes of Health (NIH) for funding and collaboration on the Vivian™ pediatric CRRT system

A significant external validation came on September 9, 2025, when the National Institutes of Health (NIH) awarded an approximately $3 million multi-year grant to Koronis Biomedical Technologies Corporation (KBT), Nuwellis, Inc.'s development partner. This funding is specifically targeted to accelerate the development of Vivian™, Nuwellis' dedicated pediatric continuous renal replacement therapy (CRRT) device.

The grant supports advancing core software and firmware that strengthens Nuwellis' broader device portfolio. Vivian™ is designed for pediatric patients weighing under 20 kilograms, addressing a critical gap where therapeutic options are scarce, as clinicians often adapt adult technologies.

• NIH Grant Amount: Approximately $3 million
• Grant Award Date: September 9, 2025
• Target Patient Weight for Vivian™: Under 20 kg
• Vivian™ Therapies Supported: UF, CVVH, and CVVHD

Key opinion leaders (KOLs) and physician advocates in cardiorenal and pediatric care

While specific KOL names aren't listed as formal partners, the adoption strategy is explicitly clinician-driven. Growth in pediatrics is being led by the clinicians themselves, according to CEO John Erb. The focus is on leveraging the clinical advantages of the Aquadex system in high-acuity settings.

Physician advocates are drawn to specific features that offer control and safety over traditional methods. For instance, Kelsey Newell, Senior Director of Medical Affairs, noted that the real-time hematocrit monitoring built into Aquadex allows medical teams to directly assess patient tolerance during fluid removal.

• Clinical Focus Areas Driving Advocacy: Cardiac surgery, pediatrics, and outpatient models.
• Key Feature Cited by Clinicians: Minimal extracorporeal volume requirement.
• Internal Champion for Clinical Messaging: Kelsey Newell, Senior Director of Medical Affairs.

Hospitals and clinics adopting the Aquadex Ultrafiltration Program

The Aquadex Ultrafiltration Program is seeing accelerating adoption in high-acuity pediatric settings nationwide. On December 4, 2025, Nuwellis announced that a leading Northeastern U.S. children's hospital initiated the program. This adoption is a key part of Nuwellis' strategy after deciding to exit international operations to focus exclusively on the U.S. market in August 2025.

As of late 2025, Nuwellis reported $8.17 million in revenue over the last twelve months, though the company was not profitable, with an operating margin of -135.28%. The company's market capitalization stood at $3.88 million on December 4, 2025, with insider ownership high at 75.82%.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Key Activities

You're mapping out the core actions Nuwellis, Inc. is taking to drive its business right now, late in 2025. These are the things the company absolutely must do well to execute its strategy.

Manufacturing and quality control of the Aquadex FlexFlow/SmartFlow systems

Key activities here center on ensuring product availability and quality, especially following a strategic shift in production. Nuwellis, Inc. executed a transition plan to outsource manufacturing to KDI Precision Manufacturing during 2025. This activity is supported by ongoing investments in sustaining engineering and quality systems. The focus on quality control is reflected in the financial reporting, even as gross margin in the third quarter of 2025 settled at 65.2%, down from 70.0% in the prior year quarter, partly due to unfavorable manufacturing utilization recognized in Costs of Sales in the first half of fiscal year 2025.

U.S. direct sales force expansion and training to historical headcount levels

A major operational focus is rebuilding the commercial engine in the United States. This is evident in the operating expense structure; Selling, General and Administrative (SG&A) expenses for the third quarter of 2025 were $3.5 million, a significant increase from $2.7 million in the third quarter of 2024. This increase directly reflects the investment in payroll and compensation associated with rebuilding the U.S. sales force to historical headcount levels. The U.S. focus is showing traction, with U.S. console sales increasing four-fold sequentially in Q3 2025. As of the second quarter of 2025, the company successfully grew to 47 pediatric centers adopting Aquadex therapy.

Research and development (R&D) for next-generation products like Vivian™ (Q3 2025 R&D was $603K)

Research and development remains a necessary activity, though priorities are shifting. For the third quarter of 2025, Nuwellis, Inc. reported R&D expenses of $603,000. This was up from $486,000 in the third quarter of 2024. The Q3 2025 R&D spending was driven by an increase in expenses for continued investment in sustained engineering and the company's quality systems. The pipeline activity includes advancing the NIH-funded collaboration for the Vivian pediatric CRRT system.

Here's a quick look at the recent R&D spending:

Clinical evidence generation, including the REVERSE-HF trial

Clinical evidence generation saw a major strategic change in mid-2025. Nuwellis, Inc. announced the termination of its REVERSE-HF clinical trial on July 17, 2025. This trial was evaluating ultrafiltration versus IV loop diuretic therapy in hospitalized heart failure patients. At the time of termination, the trial had enrolled 167 patients. The company expects to save approximately $4.0M over the next 2.5 years by terminating this study. Still, generating evidence continues through other avenues, such as the Ultra Peds registry, which reported 92% survival in children treated with Aquadex for acute kidney injury or fluid overload.

Wind-down of international operations to focus exclusively on the U.S. market

The company is actively executing a strategic realignment to concentrate solely on the U.S. market. This is evidenced by the commencement of international wind-down activities in the third quarter of 2025. This wind-down contributed to a $0.1 million year-over-year decrease in international revenue in Q3 2025. The overall strategy is to strengthen the U.S.-driven business model.

The key focus areas driving these activities are:

• Hospital-based outpatient heart failure programs.
• Pediatric fluid management.
• Critical care, especially post cardiac surgery.

Finance: draft 13-week cash view by Friday.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Key Resources

You're looking at the core assets Nuwellis, Inc. relies on to execute its cardiorenal fluid management strategy as of late 2025. These aren't just line items; they are the tangible and intangible foundations of their business.

The primary physical resource is the Aquadex FlexFlow® and Aquadex SmartFlow® ultrafiltration systems. These FDA-cleared systems are central to delivering precision fluid management therapy to patients with hypervolemia, including those in critical care, heart failure, and pediatrics. The company is actively expanding where this therapy is delivered, noting the first Aquadex® therapies were initiated in a hospital-based outpatient setting under a new CMS code during the third quarter of 2025.

Intellectual property forms a crucial intangible resource. Nuwellis, Inc. has been actively fortifying this area. Specifically, they expanded their IP portfolio with the granting of a new U.S. patent covering the fluid bag design that passively drains once full. Furthermore, pediatric product development is being accelerated through an NIH-funded collaboration to advance the Vivian™ pediatric CRRT system.

On the human capital side, the U.S. direct sales and clinical support team is a key focus area for investment. In the third quarter of 2025, operating expenses rose 30% year-over-year, which management directly attributed to the investment in rebuilding the U.S. sales force to historical headcount levels. Operationally, this team supports adoption across various settings, having grown to 47 pediatric centers utilizing Aquadex therapy as of the second quarter of 2025. The company also executed a manufacturing transition to KDI Precision Manufacturing to focus squarely on U.S. market growth.

The financial resources supporting these operations as of September 30, 2025, are summarized below. Honestly, maintaining liquidity is paramount given the operating losses.

The company also noted it remains debt-free as of the end of the third quarter of 2025.

You should track the progress of that sales force rebuilding against the operating expense burn rate; Finance: draft 13-week cash view by Friday.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Value Propositions

You're looking at the core benefits Nuwellis, Inc. is delivering to its customers-the reasons clinicians and hospitals choose the Aquadex SmartFlow system. It's all about precise fluid removal when other methods fail, especially for your most vulnerable patients.

Precise, controlled ultrafiltration for fluid overload patients who failed diuretics

The therapy offers a specific, controlled way to pull excess fluid, which is key when diuretics aren't working anymore. This isn't a guess; it's targeted therapy. For instance, in the ULTRA-Peds registry, which looked at critically ill children, 86% of the Aquadex circuits completed their intended treatment course without interruption, showing procedural reliability in tough cases.

Minimal extracorporeal volume, which is critical for fluid-sensitive pediatric patients

For your smallest, most fragile patients, keeping the volume of blood outside the body (extracorporeal volume) low is non-negotiable. The Aquadex therapy is sought after for this minimal volume requirement. The clinical evidence supports this focus on the pediatric segment, which is a major growth driver for Nuwellis, Inc. Pediatric revenue specifically grew 38% year-over-year in the first quarter of 2025.

Here's a quick look at the impact in the pediatric space as of late 2025:

What this estimate hides is that while survival during treatment was high, survival to hospital discharge was 66% in that same registry. Still, for this vulnerable population, any positive data is a big deal.

New 24-hour circuit and dual-lumen catheter for enhanced provider flexibility

Nuwellis, Inc. launched new tools to make delivery easier across different settings. They introduced the new 24-hour circuit in the fall of 2025, designed for single-day outpatient sessions, and they received FDA 510(k) clearance for a new size of their Dual Lumen Extended Length Catheter (dELC) on August 21, 2025. This is about giving clinicians the right tool to match the patient and the care setting, whether that's the ICU or a hospital-based outpatient program. The dELC offers two insertable lengths, 11 cm and 15 cm options.

Reduced economic burden for hospitals by avoiding 30-day readmission penalties

While direct avoidance numbers aren't public, the shift to outpatient use, supported by better reimbursement, directly impacts the economic picture. Effective January 1, 2025, CMS reassigned Aquadex to a higher outpatient reimbursement level, increasing the facility fee nearly four-fold to $1,639 per day. This higher, predictable payment stream helps offset costs. To be fair, preliminary data for FY2025 suggested about 7% of hospitals would face a penalty reducing Medicare payments by 1% or more, so any therapy that keeps patients stable and out of the readmission window is defintely valuable.

The company also streamlined its operations to focus resources where they matter most, expecting to save approximately $4.0 million over the next 2.5 years by terminating the REVERSE-HF clinical trial.

• The new outpatient facility fee is $1,639 per day, effective January 1, 2025.
• The new 24-hour circuit supports hospital-based outpatient therapy.
• The company reported Q3 2025 revenue of $2.2 million.
• The company remains debt-free as of Q3 2025.

Finance: draft 13-week cash view by Friday.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Customer Relationships

You're looking at how Nuwellis, Inc. (NUWE) builds and maintains its connections with hospitals and physicians, which is critical since their revenue model hinges on recurring consumable sales from installed consoles. The relationship strategy is clearly hands-on, especially given the device's use in acute settings.

Dedicated direct sales and clinical support for hospitals and physicians

The company supports its installed base through direct engagement, which you can see reflected in their operating expenses. Selling, general, and administrative (SG&A) expenses for the first quarter of 2025 were $3.6 million, which was a 22% decrease from the prior-year period, partly due to lower headcount. However, the third quarter of 2025 saw operating expenses increase by 30% year-over-year, reflecting an increased investment in rebuilding the U.S. sales force to historical headcount levels. This rebuilding signals a commitment to strengthening the direct sales and support structure to drive adoption across inpatient and emerging outpatient environments. Honestly, the shift in spending suggests they are prioritizing direct clinical presence again.

Clinician-led adoption and advocacy, especially in pediatric centers

Clinician advocacy is a major driver, particularly within the pediatric segment. Pediatric revenue showed significant growth, increasing by 38% year-over-year in the first quarter of 2025. As of June 30, 2025, Nuwellis, Inc. successfully grew to 47 pediatric centers that adopted Aquadex therapy, adding two new centers across the Southeastern United States during the second quarter of 2025. Furthermore, the company is advancing pediatric product development through a collaboration funded by the NIH. This focus on a specific, high-need area suggests that deep clinical buy-in is central to their growth strategy.

High-touch service model for console installation and ongoing consumable supply

The ongoing relationship is cemented by the high-touch service model supporting the recurring revenue stream from consumables. Consumables utilization showed growth of 4% year-over-year in the first quarter of 2025. To enhance service flexibility and support new use cases, Nuwellis, Inc. launched a new 24-hour circuit and a dual-lumen extended-length catheter in the third quarter of 2025. The company is also expanding access by delivering the first Aquadex therapies in hospital-based outpatient settings under a new CMS code, which saw the facility fee increase nearly four-fold to $1,639 per day effective January 1, 2025. This combination of new high-value supplies and improved reimbursement directly supports the ongoing utilization relationship.

Here's a quick look at some of the key customer-facing metrics as of mid-to-late 2025:

Nuwellis, Inc. (NUWE) - Canvas Business Model: Channels

The Channels component for Nuwellis, Inc. centers on getting the Aquadex System, including the console and recurring disposable components, to the end-user-hospitals and clinics-and supporting new care settings.

U.S. direct sales force selling to hospitals and clinics

Nuwellis, Inc. relies on its direct sales force within the United States to sell the Aquadex FlexFlow and Aquadex SmartFlow systems to hospitals and clinics, focusing on critical care and pediatrics initially. The company signaled a strategic push in this area, as Q3 2025 operating expenses included an increased investment in rebuilding the U.S. sales force to historical headcount levels. This direct engagement supports both the initial console placement and the subsequent recurring revenue from disposables.

The performance of this channel is reflected in the sales figures:

• Q3 2025 revenue growth was sequentially up 29%, driven by stronger U.S. console sales.
• Q1 2025 saw 4% growth in consumables utilization alongside higher U.S. console sales.
• Pediatric revenue, a key segment served by this channel, grew 38% year-over-year in Q1 2025.

Hospital-based outpatient settings, a new channel supported by CMS reimbursement

A major channel expansion effort in late 2025 is the push into hospital-based outpatient settings, made financially viable by a significant Centers for Medicare and Medicaid Services (CMS) action effective January 1, 2025. The CMS reassignment of the Aquadex ultrafiltration code increased the outpatient reimbursement rate by 397%, moving the facility fee from $413 to $1,639 per day. Nuwellis reported the initiation of Aquadex therapies in outpatient settings during the third quarter of 2025.

To specifically support this single-visit workflow, Nuwellis announced plans to introduce a new 24-hour circuit in the fall of 2025, which complements the existing 72-hour option used for multi-day or inpatient therapy. The company is actively working to scale this outpatient model throughout 2025.

Specialized distribution for the Aquadex System's disposable components

While the U.S. relies on the direct sales force, Nuwellis, Inc. utilizes independent specialty distributors for its international market presence. The disposable components, which drive recurring revenue, are central to the value proposition across all channels. The company is focused on driving increased consumable utilization across its core customer categories: heart failure, critical care, and pediatrics.

Here's a quick look at key channel metrics as of late 2025:

The company also managed a distribution shift by settling with SeaStar Medical, which involved receiving a total of $900,000 in payments, with the final installment due by December 31, 2024.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Customer Segments

You're looking at the core patient populations Nuwellis, Inc. targets for its Aquadex therapy. This is where the revenue engine is being built, focusing on high-acuity hospital settings and an emerging outpatient channel.

Pediatric Nephrology and Cardiology departments represent a key growth pillar, driven by clinicians seeking a reliable, low-volume extracorporeal fluid management option for children.

• Successfully grew to 47 pediatric centers that adopted Aquadex therapy as of Q2 2025.
• Pediatric revenue showed a 23% year-over-year increase in Q2 2025.
• In the first quarter of 2025, pediatric revenue grew 38% year-over-year.

Critical Care Units (CCU) and Cardiac Surgery departments in U.S. hospitals are targeted for managing acute kidney injury and postoperative fluid overload. While this segment faced headwinds, adoption is a focus for the second half of 2025.

Heart Failure clinics utilizing hospital-based outpatient therapy are a strategic expansion area, supported by significant reimbursement changes effective early in 2025.

• The first Aquadex therapies were delivered in a hospital-based outpatient setting in Q3 2025.
• Effective January 1, 2025, the CMS reassigned Aquadex to a higher outpatient reimbursement level, increasing the facility fee nearly four-fold to $1,639 per day.

Here's a quick look at how the revenue performance broke down across these segments in the mid-year reporting periods:

All customer categories achieved year-over-year growth in circuit sales during the third quarter of 2025, which highlights broader adoption across these areas.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Cost Structure

You're looking at the cost side of the Nuwellis, Inc. equation as of late 2025. The focus is clearly on scaling the U.S. commercial engine, which naturally drives up certain operating costs.

The High Selling, General, and Administrative (SG&A) expenses are a major component of the cost structure. For the third quarter of 2025, these expenses were reported at $3.5 million. This figure reflects the deliberate investment the company is making to support its growth strategy.

The core costs tied to the product itself fall under Cost of Goods Sold (COGS), which covers the manufacturing of the Aquadex consoles and the recurring disposable circuits. For the third quarter of 2025, the reported COGS was $772K. This number is key because it directly impacts the gross margin, which was reported at 65.2% for Q3 2025, down from 70% in Q3 2024.

Here's a quick look at the key operating expenses for Q3 2025:

The Research and Development (R&D) investment remains a necessary cost to keep the innovation pipeline moving. For Q3 2025, R&D spend was $603K. This supports product innovation, including advancements in the Vivian pediatric CRRT system.

A significant driver behind the elevated SG&A is the costs associated with rebuilding the U.S. sales force headcount. This investment is strategic, aimed at expanding adoption across critical care, pediatrics, and the emerging hospital-based outpatient setting. The increase in SG&A to $3.5 million in Q3 2025, up from $2.7 million in Q3 2024, directly reflects these growth-focused initiatives in the U.S. business.

You should keep an eye on these specific cost drivers:

• SG&A increase tied to sales force expansion.
• COGS fluctuations from manufacturing transition.
• R&D spend supporting new product launches.
• Costs related to exiting international operations.

The company is actively managing these costs while focusing on U.S. market growth, which requires upfront spending on personnel and infrastructure.

Nuwellis, Inc. (NUWE) - Canvas Business Model: Revenue Streams

Nuwellis, Inc. generates revenue through two primary channels tied to its Aquadex therapy platform.

The first stream involves the sale of Aquadex FlexFlow/SmartFlow consoles (capital equipment). The second, and more recurring, stream comes from the sale of disposable blood circuits and catheters (consumables) necessary for each therapy session.

Total revenue for Q3 2025 was $2.2 million. Revenue is highly dependent on consumables utilization, which grew 23% sequentially in Q3 2025. This sequential growth in utilization, alongside a four-fold increase in U.S. console sales, drove a total sequential revenue increase of 29% from the second quarter.

Here's a breakdown of the Q3 2025 performance metrics related to these streams:

The utilization of consumables across customer segments showed distinct performance:

• Heart failure circuit sales were 41% ahead of the prior year.
• Critical care circuit sales were 15% ahead of the prior year.
• Pediatrics circuit sales declined 7% year-over-year, largely due to lower console sales in that segment.

The company is actively managing these streams by focusing on U.S. market growth and initiating a manufacturing transition to KDI Precision Manufacturing. Finance: draft 13-week cash view by Friday.