FURTHER EVIDENCE FOR LASTING IMMUNOLOGICAL EFFICACY OF DIAMYD DIABETES VACCINE


FURTHER EVIDENCE FOR LASTING IMMUNOLOGICAL EFFICACY OF DIAMYD DIABETES VACCINE

Press Release, Stockholm, Sweden, September 19, 2007 - Diamyd Medical AB
(www.omxgroup.com, ticker: DIAM B; www.otcqx.com, ticker DMYDY)

Diamyd Medical announced today that further evidence for lasting immunologic
efficacy of the Diamyd® diabetes vaccine, was presented at the European
Association for the Study of Diabetes (EASD) conference in Amsterdam on the 18th
of September 2007. The presentation confirmed that treatment with Diamyd® causes
a specific immune response to GAD65 remaining even 15 months after treatment.
The immunological effect was observed in patients receiving Diamyd®, but not in
patients receiving placebo.

Previously it has been reported that two injections of 20 µg Diamyd® preserved
beta cell function in a Phase IIb study comprising 70 children with type 1
diabetes. In that same study, immunological analyses were conducted by the team
of Professor Johnny Ludvigsson, Linköping University, Sweden. The conclusion of
the EASD presentation, made by Associate Professor Maria Faresjö, is that the
Diamyd® vaccination induces specific T-cells that may rebalance the immune
system resulting in the protective effect seen on beta cell function.

Upon in vitro stimulation with GAD65, 15 months after vaccination, the immune
system of Diamyd®-treated patients showed a highly statistically significant
increase in the secretion of several immunomodulatory substances, dominated by
regulatory cytokines, including IL5, IL13, IL10, IL17, IFN-γ and TNF-α. The same
immunological fingerprint was observed in virtually all Diamyd® treated patients
(fig 1).

(image) Fig 1: Patients receiving Diamyd® showed an up regulation of cytokines
in response to GAD65. The immunological fingerprint of Diamyd® treated patients
contained more of protective cytokines (green colors) than placebo treated
patients. Placebo patients secreted a higher percentage of inflammatory
cytokines (red colors) than the treated patients. This may explain the
protective effect on beta cell function of Diamyd® treatment.

Dr. Faresjö also showed that the activity of T-cells in response to GAD65 was
clearly increased in Diamyd® treated patients, measured as GAD65 induced FOXP3
expression.

“This is the first time that biomarkers have been identified that correlate with
immunological efficacy using an autoantigen specific therapy in the clinic”,
says the internationally renowned immunologist Professor Bart Roep, Leiden
University Medical Center, The Netherlands. “Furthermore, these results show
evidence of immune markers that correlate with clinical efficacy, providing
another novelty in immune intervention therapy in autoimmune diseases. Perhaps
the most astonishing finding is the persistence of immune changes many months
after therapy, which implies a lasting impact of Diamyd® on autoimmune
deviation. I congratulate Professor Ludvigsson and his team on their pioneering
clinical studies that led to this breakthrough.”

Type 1 diabetes is an autoimmune disease where the insulin producing beta cells
are under attack from the patients own immune system. The Diamyd® vaccine is
aimed at inducing active functional tolerance to beta cells by means of
administering a major beta cell autoantigen (GAD65) in a formulation and route
designated to rebalance the immune system. This is believed to arrest or slow
down the autoimmune process in type 1 diabetes.

For further information, please contact:
Stockholm office
Anders Essen-Möller
CEO and President 
+46 8 661 0026
investor.relations@diamyd.com

Pittsburgh office
Michael Christini
President
+1 412 770 1310
Michael.Christini@diamyd.com

Diamyd Medical AB (publ). Linnégatan 89 B, SE-115 23 Stockholm, Sweden. Tel: +46
8 661 00 26, fax: +46 8 661 63 68 or E-mail: info@diamyd.com. VATno:
SE556530-142001.

About Diamyd Medical
Diamyd Medical is a life science company developing treatments for diabetes and
its complications. The company's furthest developed project is the GAD-based
drug Diamyd® for autoimmune diabetes for which Phase III studies are planned to
be initiated this year. Diamyd® has demonstrated significant and positive
results in Phase II clinical trials in Sweden.

GAD65, a major autoantigen in autoimmune diabetes, is the active substance in
Diamyd. GAD65 is also an enzyme that converts the excitatory neurotransmitter
glutamate to the inhibitory transmitter GABA. In this context, GAD may have an
important role not only in diabetes but also in several central nervous
system-related diseases. Diamyd Medical has an exclusive worldwide license from
the University of California at Los Angeles regarding the therapeutic use of the
GAD65 gene.

Diamyd Medical has sublicensed its UCLA GAD Composition of Matter license to
Neurologix, Inc. in Fort Lee, New Jersey for treatment of Parkinson's disease
with an AAV-vector.

Other projects comprise drug development within therapeutic gene transfer using
the exclusively licensed and patent protected Nerve Targeted Drug Delivery
System (NTDDS). The company's lead NTDDS projects include using enkephalin and
GAD for chronic pain, e.g., diabetes pain or cancer pain. All projects in this
field are currently in preclinical phases.

Diamyd Medical has offices in Stockholm, Sweden and Pittsburgh, PA. The Diamyd
Medical share is quoted on the Stockholm Nordic Exchange in Sweden (NOMX ticker:
DIAM B) and on the OTCQX-list in the United States (ticker: DMYDY) administered
by the Pink Sheets and the Bank of New York (PAL). Further information is
available at www.diamyd.com.

Disclaimer: This document contains certain "statements" relating to present
understandings, future events and future performance, including statements
relating to the progress, timing and completion of our research, development and
clinical trials; our ability to market, commercialize and achieve market
acceptance for product candidates; and our current and future strategic partner
relationships. These statements can be affected by inaccurate assumptions or by
known or unknown risks and uncertainties. Diamyd Medical undertakes no
obligation to publicly update such statements, whether because of new
information, future events or otherwise, nor does Diamyd Medical give any
guarantees that the statements, given or implied, are correct. This document is
a translation from the Swedish original. No guarantees are made that the
translation is free from errors.

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