Fourth Quarter Report for Diamyd Medical AB (publ.), Fiscal Year 2008/2009
(www.omxgroup.com ticker: DIAM B; www.otcqx.com ticker: DMYDY)
Fourth quarter, June 1, 2009 - August 31, 2009
• The US FDA approves the inclusion of children aged 10 and above in American
Phase III study with the Diamyd® diabetes vaccine
• The first children are vaccinated in a prevention study with Diamyd® with the
aim of preventing type 1 diabetes
• The Company begins to include children and accelerate patient recruitment for
its American Phase III study with the Diamyd® diabetes vaccine
• Group net sales for the quarter amounted to KSEK 29 (133)
• Loss before tax for the quarter was KSEK -29 772 (-20 327)
• Earnings per share for the quarter were SEK -2,7 (-1,9)
Significant events after reporting period
• A four-year follow-up of type 1 diabetes patients who were part of the
Company's Phase II study shows a clear positive trend
• The Company signs an agreement with Inclinix Inc. to accelerate recruitment
of patients for the American Phase III study of the Diamyd® diabetes vaccine
• 90 percent of the patients in the Company's European Phase III study with the
Diamyd® diabetes vaccine are included
• An extra shareholders' meeting resolves, in accordance with the proposal put
forward by the Board of Directors, to implement a new share issue of just under
MSEK 220 with preferential rights for existing shareholders
• The Company executes a settlement agreement with Apoteket AB regarding a
clinical study in LADA patients, which was invalidated in 2007. Diamyd has
claimed damages from Apoteket AB for unnecessary costs related to the
invalidated study. The settlement agreement includes a payment of SEK 11
million to Diamyd as compensation for the insufficiencies in Apoteket's
routines and documentation causing Diamyd to invalidate the study.
Full year, September 1, 2008 - August 31, 2009
• Group net sales for the year were KSEK 1 105 (1 092)
• Loss before tax for the year was KSEK -81 803 (-63 945)
• Group liquid assets amounted to KSEK 37 287 (81 890)
• Earnings per share for the year were SEK -7,4 (-6,3)
CEO COMMENTS
Diamyd is in a great position
In the past year Diamyd Medical came ever closer to realizing its vision of
being able to prevent and cure the autoimmune form of diabetes in the future.
Continued success in the clinical trials of the Company's three candidate drugs
is positioning Diamyd as a diabetes company with an exciting future.
Interest in Diamyd's business has increased markedly as the positive results of
our clinical trials have been published in respected scientific journals and
several prominent research groups has chosen to work with the Diamyd® vaccine.
Several large international pharmaceutical companies are following our progress
closely, and their interest in the structured licensing process for Diamyd®
that we are managing in cooperation with an American consulting firm is
confirmation of our belief that the diabetes vaccine is an extremely valuable
asset for the Company.
We are conducting clinical trials of the Diamyd® vaccine for treatment of newly
diagnosed type 1 diabetes in nine European countries and the US. The pace of
recruitment indicates that we can begin to report Phase III data in the spring
of 2011, and that a market approval application can be submitted in the same
year. Market approval is now within Diamyd's reach!
For business reasons Diamyd has chosen to secure the financing of the
operations through a preferential rights issue until we have study results. New
shares may be subscribed for through October 30, 2009, and the issue is fully
underwritten. In my judgment, as well as the Board's, the issue will provide
Diamyd with the necessary resources by some margin until our Phase III results
are available. This strengthens our bargaining position in current partnership
negotiations, while enabling us to choose the optimal structure and time for a
licensing agreement.
We could recently report that we executed a settlement agreement with Apoteket
AB regarding the LADA study of 160 patients, which was invalidated in 2007. The
settlement agreement includes a payment of SEK 11 million to Diamyd as
compensation for the insufficiencies in Apoteket's routines and documentation
causing Diamyd to invalidate the study. It is extremely gratifying to put this
behind us, and we are looking forward to new LADA studies where we will try to
confirm the positive results that we previously received with this patient
group after treatment with the Diamyd® diabetes vaccine.
Development of new pharmaceuticals entails risks as well as opportunities. My
strong belief is that in Diamyd´s case the opportunities outweigh the risks and
our latest successes have further strengthened me in this belief.
Elisabeth Lindner
President and CEO, Diamyd Medical AB
SIGNIFICANT EVENTS DURING THE PERIOD
JUNE 1, 2009 - AUGUST 31, 2009
The US FDA approves the inclusion of children aged 10 and above in American
Phase III study with the Diamyd® diabetes vaccine. The approval means that the
Company can accelerate patient recruitment in the US. Now Diamyd Medical will
increase the number of American pediatric clinics in the study as it receives
approvals from the US ethics committees.
The first children are vaccinated in a prevention study with Diamyd® with the
aim of preventing type 1 diabetes. The study's purpose is to evaluate whether
vaccination with Diamyd® can prevent or delay the development of type 1
diabetes in children at high risk of developing the disease. This is the first
test ever of preventive vaccination with Diamyd® for this chronic disease. The
study is being led by Helena Elding Larsson, a pediatrician at the UMAS
university hospital in Malmö.
The Company begins to include children and accelerate patient recruitment for
its American Phase III study with the Diamyd® diabetes vaccine. Children aged
10 and above with type 1 diabetes are being included in the American Phase III
study of the Diamyd® diabetes vaccine as of September 1, 2009. Moreover, the
Company is gradually trebling the number of clinics to over forty, and is
putting its efforts into expanded recruitment activities in the US. The
American Phase III study with the diabetes vaccine Diamyd® was previously only
open to patients with type 1 diabetes aged between 16 and 20 years.
SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD
A four-year follow-up of type 1 diabetes patients who were part of the
Company's Phase II study shows a clear positive trend. In February Diamyd
Medical received approval from the Swedish Medical Products Agency to follow up
the children and adolescents with type 1 diabetes who were part of the
Company's previously reported Phase II study with the Diamyd® diabetes vaccine
that began in 2005. An initial analysis of the new data shows that four years
after treatment, those patients who received the Diamyd®-vaccine and who had
recently developed the disease when the study began still have a better
diabetes status than corresponding patients who received a placebo. The safety
data also continues to look promising, without any serious side effects
associated with the treatment.
The Company signs an agreement with Inclinix Inc. to accelerate recruitment of
patients for the American Phase III study of the Diamyd® diabetes vaccine.
Inclinix is a global patient recruitment company with extensive experience in
recruiting type 1 diabetes patients in the US. They recruit using directed
Internet advertising, social media, regional recruitment staff and patient
referrals from clinics close to the clinics participating in the study. The
agreement with Inclinix is performance based and targets to enable filing for
market approval in the US during 2011. The American recruitment campaign was
launched in cooperation with Inclinix, under the name DIAPREVENT.
90 percent of the patients in the Company's European Phase III study with the
Diamyd® diabetes vaccine are included. 90 percent of a total of 320 children
and adolescents with type 1 diabetes participating in the company's European
Phase III study of the Diamyd® diabetes vaccine have now been included and have
received injections of Diamyd® or a placebo. The Company expects all
participants to have been included in the study by November 2009.
An extra shareholders' meeting resolves, in accordance with the proposal put
forward by the Board of Directors, to implement a new share issue of just under
MSEK 220 with preferential rights for existing shareholders. The additional
capital is required to cover by some margin the costs that the Company
anticipates incurring up to spring 2011, when data from the current Phase III
program is expected to be available, and to strengthen the Company's bargaining
position in partnership negotiations currently in progress. New shares may be
subscribed for through October 30, 2009. For more information, please refer to
the prospectus for the preferential rights issue prepared by the Diamyd Medical
Board of Directors. The prospectus is available on the Company's website,
www.diamyd.com.
The Company executes a settlement agreement with Apoteket AB regarding a
clinical study in LADA patients, which was invalidated in 2007. Diamyd has
claimed damages from Apoteket AB for unnecessary costs related to the
invalidated study. The settlement agreement includes a payment of SEK 11
million to Diamyd as compensation for the insufficiencies in Apoteket's
routines and documentation causing Diamyd to invalidate the study. Diamyd
contracted Apoteket AB in 2004 for handling of blinding, randomization
and labeling of the study drug for a clinical study with 160 LADA patients. As
the study was unblinded and reported during summer 2007, the data was found to
be inconclusive. An inspection at the pharmacy, that had handled the study
drug, revealed insufficiencies in routines and documentation, which made it
impossible to conclude which patients had received active drug and which
patients had received placebo. The study was invalidated on these grounds.
-- To read the complete report, please see attached PDF, or read the report at
www.diamyd.com --
