Its just a calcium reactor, but with a sulphur based media. Since you have a very slow flow in/out of the reactor, this allows the water to become oxygen depleted. Denitrifying bacteria colonize the sulphur media and consume nitrates and convert it to nitrogen as a by-product.

Because the depleted oxygen levels reduce the ph levels inside the reactor, you also add a layer of aragonite inside the reactor to help buffer the water exiting the filter. Like everything else in this hobby, they started in Germany at public aquariums in the 90's and slowly caught on as word spread about their effectiveness.

If you properly size one, they can be very effective.