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Diamyd Medical: Quarterly Report I 12/13

  Diamyd Medical: Quarterly Report I 12/13

Business Wire

STOCKHOLM -- January 23, 2013

Regulatory News:

Quarterly Report 1, Diamyd Medical AB (publ) (STO:DIAMB)(Pink Sheets:DMYDY),
fiscal year 2012/2013

Reporting period September 1, 2012 – November 30, 2012

  *Group net sales amounted to MSEK 0 (0.2)
  *Loss before tax amounted to MSEK -1.8 (-3.5)
  *Earnings per share after dilution were SEK -0.2 (-0.3)
  *Liquid assets and short term investments amounted to MSEK 373 (414) as of
    November 30, 2012

Significant events during the reporting period

  *Agreement was entered into for the sale of US gene therapy company and an
    Extraordinary General Meeting of Diamyd Medical AB approved the sale
  *Diamyd Medical limited further investment in the diabetes vaccine Diamyd®

Significant events after the reporting period

  *New Board members of Diamyd Medical AB
  *The Board’s proposal regarding redemption of shares and stock dividend,
    and an alternative shareholder proposal, were announced
  *Recombinant vaccine from Protein Sciences received FDA approval

CEO COMMENTS

We recently got the good news that Protein Sciences has received market
approval for their influenza vaccine FluBlok in the US. It has taken a long
time and they have overcome many hurdles along the way, but it is an inspiring
example of that perseverance pays. The approval has received a lot of
attention in the US. Protein Sciences is planning to have a limited launch of
the product in February 2013 with the full launch occurring in time for the
2013/14 influenza season. Diamyd Medical holds about 8 percent of the shares
in Protein Sciences.

Flublok is the first vaccine against seasonal influenza that is manufactured
using modern recombinant technology to reach the US market. The advantages
compared to traditional vaccine manufacturing are that it requires less lead
time to manufacture after the identification of the year's flu strains, the
vaccines are not produced in eggs and therefore do not contain egg
derivatives, and the manufacturing does not require the use of live influenza
virus, the mercury compound thimerosal or antibiotics. Protein Sciences is
also developing a similar vaccine against pandemic influenza in collaboration
with the Biomedical Advanced Research and Development Authority, a division of
the US Department of Health and Human Services.

We see a continued strong interest from researchers in our own diabetes
vaccine Diamyd®. Our plan is to encourage researcher initiated studies, where
Diamyd® is tested in combination with other drugs, in limited, less costly
clinical pilot studies in recent-onset type 1 diabetes. By attacking the
disease from several sides with combination therapy, the idea is to provide a
better chance for the diabetes vaccine to intervene in the autoimmune disease
process underlying type 1 diabetes. We also want to see more researcher
initiated studies started to test the diabetes vaccine in people who have not
yet developed type 1 diabetes, but are demonstrated to have an elevated risk
of developing the disease. There is already such a pilot study ongoing in
Sweden, where results are expected in 2015. By collaborating with externally
funded research groups, we will be able to test more treatment paradigms than
if we would have conducted and funded all the studies ourselves.

On January 31, we have an Extraordinary General Meeting in Stockholm. The
meeting will resolve on the distribution of SEK 118 million, corresponding to
about a third of the Company’s cash, to our shareholders through a share
redemption program. If the meeting resolves on the redemption of shares, the
shareholders will receive detailed information on the redemption procedure.

Stockholm, January 23, 2013

Peter Zerhouni President and CEO Diamyd Medical AB

Note: Historical comparative figures in the report are presented excluding
Diamyd, Inc. and the NTDDS operations, which were divested during the autumn
of 2012.

SIGNIFICANT EVENTS DURING THE REPORTING PERIOD SEPTEMBER 1, 2012 – NOVEMBER
30, 2012

Agreement was entered into for the sale of US gene therapy company and an
Extraordinary General Meeting of Diamyd Medical AB approved the sale. Diamyd
Medical AB entered into an agreement for the sale of the US subsidiary,
Diamyd, Inc., involved in drug development primarily relating to the NTDDS
platform with applications in pain and neuropathy among others. The buyer,
Periphagen Holdings, Inc., is owned by members of the management of Diamyd,
Inc. The agreement was subject to approval of an Extraordinary General Meeting
of Diamyd Medical. By reason of the divestment, Diamyd Medical postponed its
Year End Report to October 31, 2012. An Extraordinary General Meeting of
Diamyd Medical AB held on October 30, 2012, decided in accordance with the
Board's resolution, to approve the agreement to sell all shares in the
subsidiary, Diamyd, Inc. to Periphagen Holdings, Inc.

Diamyd Medical limited further investment in the diabetes vaccine Diamyd®.
Diamyd Medical AB decided to allocate a maximum of SEK 30 million over three
years for the development of the diabetes vaccine Diamyd®. The development
activities are gathered in the subsidiary Diamyd Therapeutics.

SIGNIFICANT EVENTS AFTER THE REPORTING PERIOD

New Board members of Diamyd Medical AB. At the Annual General Meeting of
Diamyd Medical AB on December 6, 2012, Erik Nerpin and Jonas Jendi were
elected as new Board members. Anders Essen-Möller was re-elected as Chairman
of the Board and Maria-Teresa Essen-Möller was re-elected to the Board. The
former Board members Lars Jonsson, Joseph Janes and Christer Lindberg declined
re-election.

The Board’s proposal regarding redemption of shares and stock dividend, and an
alternative shareholder proposal, were announced. Diamyd Medical AB announced
the Board’s complete proposal regarding redemption of shares and stock
dividend, including the Board’s and the auditors' opinions and statements
under the Companies Act, to be considered at an Extraordinary General Meeting
on January 31, 2013. Furthermore, an alternative proposal for the structure of
the redemption procedure by the shareholder Bertil Lindkvist was also
announced.

Recombinant vaccine from Protein Sciences received FDA approval. The US Food
and Drug Administration approved Protein Sciences Corporation’s vaccine
Flublok for the prevention of seasonal influenza in adults 18 to 49 years of
age. Diamyd Medical holds about 8 percent of the shares in Protein Sciences
Corporation.

*** To read the complete report, please follow the link to the PDF:
http://mb.cision.com/Main/566/9359939/84573.pdf or visit www.diamyd.com ***

Diamyd Medical AB (publ), Karlavägen 108, SE-115 26 Stockholm, Sweden. Phone:
+46 8 661 00 26 Fax: +46 8 661 63 68. E-mail: info@diamyd.com. Reg. no:
556530-1420

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.

This information was brought to you by Cision http://www.cisionwire.com

Contact:

Diamyd Medical AB
Peter Zerhouni
President and CEO
Phone: + 46 8 661 00 26
Fax: +46 8 661 63 68
E-mail: info@diamyd.com