Aradigm Receives $5 Million Milestone For Dosing of the First Patient in Phase III Study of Pulmaquin in Non-Cystic Fibrosis

  Aradigm Receives $5 Million Milestone For Dosing of the First Patient in
  Phase III Study of Pulmaquin in Non-Cystic Fibrosis Bronchiectasis

Business Wire

HAYWARD, Calif. -- June 3, 2014

Aradigm Corporation (OTC BB:ARDM.OB)  (“Aradigm” or the “Company”)  announced
that it has received the $5 million milestone payment from Grifols S.A. for
the dosing of the first patient in the ORBIT-3 (Once-daily Respiratory
Bronchiectasis Inhalation Treatment) Phase III pivotal clinical trial of
Aradigm’s proprietary formulation of inhaled ciprofloxacin (Pulmaquin®) for
the treatment of non-cystic fibrosis bronchiectasis (non-CF BE).

“I am pleased that our team has achieved this very important milestone, which
also further strengthens our financial position,” said Nancy Pecota, Chief
Financial Officer, Aradigm.

The Phase III clinical program for Pulmaquin in BE consists of two worldwide,
double-blind, placebo-controlled pivotal trials (ORBIT-3 and ORBIT-4) that are
identical in design except for a pharmacokinetics sub-study to be conducted in
one of the trials. Each trial will enroll approximately 255 patients into a 48
week double blind period consisting of 6 cycles of 28 days on treatment with
Pulmaquin or placebo plus 28 days off treatment, followed by a 28-day open
label extension in which all participants will receive Pulmaquin (total
treatment duration approximately one year). The superiority of Pulmaquin vs.
placebo during the double blind period will be evaluated in terms of the time
to first pulmonary exacerbation (primary endpoint), while key secondary
endpoints include the reduction in the number of pulmonary exacerbations and
improvements in the quality of life measures. Lung function will be monitored
as a safety indicator. The first patient in the ORBIT-3 trial was dosed on
April 29, 2014.

Bronchiectasis is a severe, chronic and rare disease characterized by abnormal
dilatation of the bronchi and bronchioles, frequently associated with chronic
lung infections. It is often a consequence of a vicious cycle of inflammation,
recurrent lung infections, and bronchial wall damage. Non-CF BE represents an
unmet medical need with high morbidity and mortality that affects more than
110,000people in the U.S. and over 200,000 people in Europe. There is
currently no drug approved for the treatment of this condition.

About Pulmaquin

Ciprofloxacin, available in oral and intravenous formulations, is a widely
prescribed antibiotic. It is used to treat acute lung infections and is often
preferred because of its broad-spectrum antibacterial activity against various
bacteria, such as Pseudomonas aeruginosa. Pulmaquin is a dual release
formulation composed of a mixture of liposome encapsulated and unencapsulated
ciprofloxacin. It is being evaluated in two Phase III studies to determine its
safety and effectiveness as a once-a-day inhaled formulation for the chronic
treatment of non-CF BE. The ORBIT-3 study began dosing patients in April 2014
and ORBIT-4 will begin dosing patients in 1H 2014.

Pulmaquin has been extensively tested through preclinical studies and a Phase
IIb study (ORBIT-2). Previous studies have demonstrated no significant
clinical safety concerns.

Aradigm has been granted orphan drug designations for inhaled liposomal
ciprofloxacin as well as for inhaled free ciprofloxacin for non-CF
bronchiectasis in the U.S. In addition, the U.S. Food and Drug Administration
(FDA) has designated Pulmaquin as a Qualified Infectious Disease Product
(QIDP). The QIDP designation is granted for treatment of non-cystic fibrosis
bronchiectasis (non-CF BE) patients with chronic lung infections with
Pseudomonas aeruginosa.

In 2013, Aradigm granted an exclusive, world-wide license for the Company’s
inhaled liposomal ciprofloxacin product candidates for the indication of
non-CF BE and other indications to Grifols S.A. More information on the terms
of this license may be found in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2013 filed with the SEC on March 13, 2014.

About Aradigm

Aradigm is an emerging specialty pharmaceutical company focused on the
development and commercialization of drugs delivered by inhalation for the
prevention and treatment of severe respiratory diseases. Aradigm has product
candidates addressing the treatment of non-CF BE, cystic fibrosis and
prevention of respiratory and other diseases in tobacco smokers through
smoking cessation. Aradigm is also developing Pulmaquin and a liposomal
ciprofloxacin formulation as potential medications for the prevention and
treatment of high threat and bioterrorism infections, such as inhaled
tularemia, pneumonic plague, Q fever and inhaled anthrax. In addition,
Aradigm’s liposomal ciprofloxacin formulations are being tested against
pulmonary non-tuberculous mycobacterial infections in preclinical studies
funded by NIH.

Disclaimer and Forward-Looking Statements

The facts and figures contained in this news release which do not refer to
historical data are “projections and forward-looking statements’”. The words
and expressions like “believe”, “hope”, “anticipate”, “predict”, “expect”,
“intend”, “should”, “try to achieve”, “estimate”, “future” and similar
expressions, insofar as they are related to Aradigm, the prospects for
Aradigm’s inhaled ciprofloxacin product formulations to successfully complete
clinical trials and to result in approved products, and the ability of Grifols
to successfully commercialize these products, are used to identify projections
and forward-looking statements. These expressions with respect to Aradigm
reflect the assumptions, hypothesis, expectations and anticipations of the
management team of Aradigm at the date of preparation of this news release,
which are subject to a number of factors that could make the real results
differ considerably, such as the uncertainties associated with clinical trials
including lack of effectiveness, lack of statistical significance of results,
adverse side effects or other safety issues, uncertainties regarding the
process of obtaining regulatory approval for the sale of new drugs,
uncertainties concerning the development of demand for new products,
uncertainties regarding the level of reimbursement for new products,
manufacturing and supply issues and the like.

Except for the historical information contained herein, this news release
contains forward-looking statements that involve risk and uncertainties
detailed from time to time in Aradigm's filings with the Securities and
Exchange Commission (SEC), including its Annual Report on Form 10-K for the
year ended December 31, 2013 filed with the SEC on March 13, 2014, and
Aradigm’s Quarterly Reports on Form 10-Q.

Aradigm, Pulmaquin and the Aradigm Logo are registered trademarks of Aradigm


Aradigm Corporation
Nancy Pecota, 510-265-8800
Aradigm Chief Financial Officer
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