Quarterly Report 1, January 25, 2017

Dear Shareholders and Readers

The first quarter of the fiscal year have included activities and new results well in line with the long-term strategy for our drug candidates; the diabetes vaccine Diamyd® and GABA.

Intralymphatic administration of Diamyd® continues to look promising and may prove to be the way forward to strengthen the positive clinical effect that meta analyses of subcutaneous administration have demonstrated. There is a clear rationale for this; studies in the allergy field have shown that intralymphatic administration compared to subcutaneous administration provides a better distribution of antigen in the lymph nodes and strengthens the effect of the adjuvant, which enhances the clinical efficacy of immunotherapy. As more and more people are living with type 1 diabetes and the costs to society are rising, there is a growing need for a drug that can delay or stop the autoimmune destruction of the insulin producing cells. Our ambition is to be the first to reach the market with a drug that can preserve endogenous insulin production and thus reduce the serious short- and long-term complications in patients with type 1 diabetes.

The diabetes vaccine Diamyd® is aimed to interrupt the autoimmune attack on the insulin-producing beta cells in type 1 diabetes by specifically reducing the immune response against the endogenous protein GAD65 that the immune system attacks by mistake. The purpose of our second drug candidate GABA is to improve beta cell health and to stimulate their regrowth, effects that new research with GABA supports. Along with the diabetes vaccine this opens up for a complete cure of type 1 diabetes.

I am convinced that the new GABA findings will lead to increased commitment to research and greater competition in the GABA related drug development. This would be positive for Diamyd Medical, as it creates an increased interest in our licensing portfolio. At the same time, it increases the demand on us to be at the forefront of strategic product development to remain competitive.

The ongoing evaluation and scale-up of the manufacturing of a proprietary GABA drug product provides Diamyd Medical with the conditions to gain full control to conduct clinical studies and develop formulations for both type 1 diabetes and our other areas of interest, type 2 diabetes and rheumatoid arthritis. With strong expertise in GABA also in our Scientific Advisory Board and with Professor Torbjörn Bäckström as affiliated Board member, expert in GABA related diseases, we are well equipped for future challenges.

Stockholm, January 25, 2017
Ulf Hannelius
President and CEO, Diamyd Medical AB (publ)

GABA along with the diabetes vaccine Diamyd® opens up for a complete cure of type 1 diabetes.
Ulf Hannelius, President and CEO

Annual Report

  November 3, 2016