Diamyd® combination trial aimed at regenerating insulin-producing capacity in established type 1 diabetes gets approval from FDA

Press release, February 5, 2009                                                 

Diamyd® combination trial aimed at regenerating insulin-producing capacity in   
established type 1 diabetes gets approval from FDA                              

Diamyd Medical reports that the US Food and Drug Administration (FDA) has       
approved a study designed to preserve and possibly regenerate insulin production
in patients with recent onset type 1 diabetes. The trial will test the diabetes 
vaccine Diamyd® in combination with drugs that are believed to stimulate new    
beta cell growth. The aim of the combination therapy is to try to restore lost  
insulin-producing capacity in established type 1 diabetes patients.             

The study will be carried out and funded by the National Institute of Diabetes  
and Kidney Disease (NIDDK), which is part of the National Institutes of Health  
(NIH) in Bethesda, MD, USA. Diamyd Medical has developed the clinical protocol  
together with NIDDK researchers and will be free to use the study results.      
Ethics approval has already been received, and screening of patients for the    
study will start in the next few weeks.                                         

This new Phase II study will be the first to combine regenerative agents and    
Diamyd®. The regenerative agents to be evaluated are lansoprazole and           
sitagliptin, which are both marketed drugs in the US. The study, to be led by   
Professor David Harlan at NIDDK, aims to enroll 82 adult patients. “We are      
excited to start this study to investigate if combining Diamyd® with potentially
regenerative stimuli can meaningfully improve treatment of established type 1   
diabetes”, says Professor Harlan, chief of the Diabetes Branch at NIDDK and     
professor of medicine at the Uniformed Services University of the Health        
Sciences.                                                                       

In type 1 diabetes, insulin-producing cells are gradually destroyed by the      
immune system. In early clinical trials, the Diamyd® vaccine has been shown to  
slow the immune attack in recent-onset type 1 diabetes. Researchers hypothesize 
that by targeting the immune attack with the Diamyd® diabetes vaccine and       
simultaneously stimulating development of insulin-producing cells, a person's   
ability to produce insulin may be preserved and may even be improved. Even a    
modest preservation of insulin-producing capacity makes diabetes significantly  
easier to control, which reduces the risk of diabetes complications that cause  
immeasurable suffering for patients and high costs for society.                 

Diamyd Medical is also collaborating with the Type 1 Diabetes TrialNet network, 
which is initiating a study with Diamyd® in 126 patients. Other collaborations  
involve two prominent type 1 diabetes research groups in the Nordic countries.  

“For a small company like Diamyd Medical, cooperating with the world's leading  
diabetes institutions to carry out research studies is a very cost efficient    
model, because it allows us to focus our own resources on the ongoing Phase III 
trials,” says Elisabeth Lindner, President and CEO of Diamyd Medical. “We are,  
of course, very happy that we are able to explore Life Cycle Management options 
for Diamyd® with the support of key experts in the field, without having to     
allocate financial resources.”                                                  

“With this combination study, Diamyd is continuing its strategic path of        
development for Diamyd® for type 1 diabetes,” continues Elisabeth Lindner. “We  
have shown that Diamyd® as a mono-therapy could preserve insulin-producing      
capacity in recent-onset type 1 diabetes, as reported in the New England Journal
of Medicine on October 30, 2008. We have a large scale Phase III program running
in Europe and the US that will support this market registration.                

In December, study protocols were filed with regulatory authorities in two      
Nordic countries for clinical studies aimed at preventing type 1 diabetes in    
subjects at high risk of developing the disease.                                

Treatment of recent-onset patients, prevention in risk patients, and combination
therapy in patients with established disease are the three treatment strategies 
envisioned for type 1 diabetes.”                                                


For more information, please contact:                                           
Elisabeth Lindner, President and CEO Diamyd Medical AB (publ.),                 
elisabeth.lindner@diamyd.com                                                    
Phone: +46-8-661 0026                                                           

For pictures and press material, please contact:                                
Sonja Catani, Chief Communications Officer Diamyd Medical AB (publ.),           
sonja.catani@diamyd.com                                                         
Phone: +46-8-661 00 26                                                          

This information is disclosed in accordance with the Securities Markets Act, the
Financial Instruments Trading Act or demands made in the exchange rules.        

Diamyd Medical is a Swedish biopharmaceutical company focusing on development of
pharmaceuticals for treatment of autoimmune diabetes and its complications. The 
company's most advanced project is the GAD-based drug Diamyd® for type 1        
diabetes, for which Phase III trials are ongoing in both the US and Europe.     
Furthermore, the company has initiated clinical studies within chronic pain,    
using its Nerve Targeting Drug Delivery System (NTDDS). The company has also    
out-licensed the use of GAD for the treatment of Parkinson's disease.           

Diamyd Medical has offices in Sweden and in the US. The share is quoted on the  
OMX Stockholm Nordic Exchange (ticker: DIAM B) and on OTCQX in the US (ticker:  
DMYDY) administered by the Pink Sheets and the Bank of New York (PAL). Further  
information is available on the company's web site: www.diamyd.com