In her comments in today's year-end report, Elisabeth Lindner, President and CEO

of Diamyd Medical, reports that in the last year Diamyd has come ever closer to

realizing its vision of being able to prevent and cure the autoimmune form of

diabetes in the future.

The most recent quarter has seen significant success in the American Phase III

study of the Diamyd^® diabetes vaccine, since the US FDA approved the inclusion

of children aged 10 and above. The number of clinics in the US will now be

gradually tripled to over forty, and an agreement has been signed with patient

recruitment firm Inclinix Inc. to accelerate the recruitment of patients. The

long-term follow-up of the company's Phase II study in children and adolescents

with newly diagnosed type 1 diabetes continues to show positive development, and

the European Phase III study is also progressing well. It will be fully

recruited in November.

- The successes in our clinical trials, taken together with increased interest

in our company and the secured financing of our Phase III results position

Diamyd as a diabetes company with an exciting future, says Elisabeth Lindner,

President and CEO of Diamyd Medical.

During the quarter the first children were also vaccinated in a Swedish

prevention study of the Diamyd^® diabetes vaccine with the aim of preventing type

1 diabetes. This is the first test ever of preventive vaccination with Diamyd^®

for this chronic disease.

After the end of the reporting period Diamyd resolved to implement a fully

underwritten new share issue of just under MSEK 220 with preferential rights for

existing shareholders. The last day to subscribe is October 30, 2009. The

company has also, after the end of the reporting period, executed 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.

For more information, please contact:

Elisabeth Lindner, President and CEO Diamyd Medical AB (publ.)

Phone: +46 8 661 0026

For pictures and press material, please contact:

Andreas Ericsson, Diamyd Medical AB (publ.)

andreas.ericsson@diamyd.com

Phone: +46 8 661 0026

About Diamyd Medical

Diamyd Medical is a Swedish diabetes company focusing on the development of

pharmaceuticals for the treatment of autoimmune diabetes and its complications.

The company's most advanced project is the GAD-based drug Diamyd^® for type 1

diabetes. Phase III trials for this drug are in progress in both Europe and the

US. In addition, the company has initiated clinical studies in the US in the

area of 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. The company currently has three clinical-phase products.

Diamyd Medical has offices in Sweden and in the US. Shares are listed on Nasdaq

OMX in Stockholm (ticker: DIAM B) and on OTCQX in the US (ticker: DMYDY)

administered by the Pink OTC Markets and the Bank of New York Mellon (PAL).

Further information is available on the company's website: www.diamyd.com.

This information is disclosed in accordance with the Swedish Securities Markets

Act, the Swedish Financial Instruments Trading Act, or the requirements stated

in the listing agreements.

Diamyd Medical AB (publ.)

Linnégatan 89 B, SE-115 23 Stockholm, Sweden. Tel: +46 (0)8 6610026, Fax: +46

(0)8 661 63 68

E-mail: info@diamyd.com. VAT no: SE556530-142001.