SIGNIFICANT MARKET SEGMENTS

12 Months Ended

Dec. 31, 2012

SIGNIFICANT MARKET SEGMENTS

SIGNIFICANT MARKET SEGMENTS

4. SIGNIFICANT MARKET SEGMENTS

        We operate in one market segment which involves the manufacture and distribution of hemodialysis concentrates, dialysis kits and ancillary products used in the dialysis process to hemodialysis clinics. For the years ended December 31, 2012, 2011 and 2010, one customer, DaVita Inc., accounted for 49%, 48% and 42% of our sales, respectively. Our accounts receivable from this customer were $2,352,000 and $2,073,000 as of December 31, 2012 and 2011, respectively. We are dependent on this key customer and the loss of its business would have a material adverse effect on our business, financial condition and results of operations. One distributor accounted for 15% of our sales in 2010. No other customers accounted for more than 10% of our sales in the last three years.

        The majority of our international sales in each of the last three years were sales to domestic distributors that were resold to end users outside the United States. Our sales to foreign customers and distributors were less than 5% of our total sales in 2012, 2011 and 2010. We have no assets outside the United States. Our total international sales, including sales to domestic distributors for resale outside the United States, aggregated 11%, 13% and 23%, of overall sales in 2012, 2011 and 2010, respectively.