Aradigm Corporation Announces the Dosing of the First Patient in Phase III Study of Pulmaquin in Non-Cystic Fibrosis

  Aradigm Corporation Announces the Dosing of the First Patient in Phase III
  Study of Pulmaquin in Non-Cystic Fibrosis Bronchiectasis (ORBIT-4)

 Aradigm’s Pulmaquin - A Potential New Therapy to Treat an Unmet Medical Need
                 in Patients with Severe Respiratory Disease

Business Wire

HAYWARD, Calif. -- June 23, 2014

Aradigm Corporation (Nasdaq:ARDM)  (“Aradigm” or the “Company”)  today
announced the dosing of the first patient in the ORBIT-4 (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). ORBIT-4 is the second of the two Phase III pivotal clinical trials
Aradigm is conducting with Pulmaquin in non-CF BE. The Company announced the
dosing of the first patient in the ORBIT-3 clinical trial in April 2014.

The first patient in ORBIT-4 was dosed by respiratory physician Dr. Shari
Brazinsky at the Institute of HealthCare Assessment, Inc. in San Diego.
“Pulmonary exacerbations in bronchiectasis patients are always a concern as
they have an immediate adverse impact on their lives and further worsen their
health long term. A treatment that would cause a reduction in the frequency
and severity of pulmonary exacerbations in this disease would be highly
desirable,” said Dr. Brazinsky.

“Both of our Phase III trials are now globally proceeding. The QIDP
Designation will provide us with the opportunity for expedited regulatory
interactions to make a potential new treatment for non-cystic fibrosis
bronchiectasis more expeditiously available to many patients with this severe
condition,” said Juergen Froehlich, MD, Chief Medical Officer of 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 is enrolling 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 is being 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 is being monitored
as a safety indicator.

"Our experience from recent international meetings confirms that non-cystic
fibrosis bronchiectasis is a serious, growing healthcare problem. The
pulmonary infections with Pseudomonas aeruginosa are of particular concern in
this patient population. We have established a network of multi-national
international collaborations to help us in the execution of the ORBIT-3 and 4
trials," said Igor Gonda, President and CEO of Aradigm.

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.

Pulmaquin has been tested in preclinical safety studies (up to 3 months in
rodents and 9 months in dogs).

Following Phase 2a development of the liposomal portion of Pulmaquin and phase
1 development of Pulmaquin, the phase 2b study ORBIT-2 with Pulmaquin was a
24-week multicenter, randomized, double-blind, placebo-controlled trial in 42
adult non-CF bronchiectasis subjects.This study demonstrated a significant
reduction in P.aeruginosa sputum activity (P =0.002) and a decrease in time to
first exacerbation in the per protocol population (p=0.046) and the mITT
(p=0.057) populations in the Pulmaquin treated subjects compared to placebo.
Overall, the incidence of all treatment emergent adverse events was similar
between groups. The most frequently reported treatment related adverse events
(reported by ≥ 3 patients in either treatment group) included product taste
abnormal and nausea in the Pulmaquin group and wheezing in the placebo group.
No serious adverse events were considered treatment related. There were no
deaths reported during ORBIT-2.

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.

Aradigm has been granted orphan drug designations for liposomal ciprofloxacin
for cystic fibrosis (CF) in the U.S. and the E.U., and liposomal ciprofloxacin
and free ciprofloxacin for inhalation for the management of bronchiectasis in
the U.S.

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
Corporation.

Contact:

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