Diamyd Medical AB (publ) Quarterly Report III 19/20 -September 2019 - May 2020, Fiscal year 2019/2020

News provided by

Diamyd Medical AB

Jun 24, 2020, 02:54 ET

STOCKHOLM, June 24, 2020 /PRNewswire/ -- Developing therapies for type 1 diabetes

Diamyd Medical's B-share is traded on Nasdaq First North Growth Market under the ticker DMYD B.

Further information is available on https://www.diamyd.com

Figures in parentheses relate to the corresponding period previous financial year.

September 1, 2019 - May 31, 2020

Net result: MSEK 23.2 (-26.8), whereof third quarter MSEK -7.2 (-7.9). The increase compared to previous year is a one-off effect due to a payment of corresponding MSEK 48.0 from the previous GAD65 manufacturer as support for transition of the manufacturing process.
Result per share: SEK 0.3 (-0.4), third quarter SEK -0.1 (-0.1)
Cash flow from operating activities: MSEK 24.1 (-28.5), third quarter: MSEK -6.8 (-9.1)
Cash and cash equivalents at May 31, 2020: MSEK 81.5 (70.5)

Significant events third quarter, March - May 2020

DiAPREV-IT2: Results presented from clinical trial with Diamyd^® in children at high risk for type 1 diabetes
Diamyd Medical fully subscribes to its pro rata share in NextCell Pharma's rights issue
ReGenerate-1: Promising findings from the first part of a clinical trial with Remygen^®
The European and Japanese Patent Offices granted patents for administration of the diabetes vaccine into the lymph node
Diamyd Medical opened up for vaccine manufacturing in Umeå, Sweden
GADinLADA: New trial with Diamyd^® in autoimmune diabetes started recruiting patients in Norway

Comments by CEO Ulf Hannelius

We are currently looking forward to the topline results from our ongoing Phase IIb trial DIAGNODE-2. In this innovative trial, the diabetes vaccine Diamyd^® is administered into a superficial lymph node. This novel administration route enhances the immunological effect of the vaccine by directly targeting the immunological site of action, and results from the pilot trial DIAGNODE-1 support superior clinical efficacy compared to the subcutaneous route used in previous trials.

Notably, we already know that a genetically defined subgroup of type 1 diabetes, a so-called disease endotype, has a very high likelihood of clinically responding to our diabetes vaccine Diamyd^® when administered subcutaneously. This finding, released in December 2019, is based on a meta-analysis comprising of data from more than 500 patients treated with subcutaneous injections of Diamyd^® in three previous placebo controlled randomized clinical trials.

Importantly, Battaglia et al. in the publication "Introducing the Endotype Concept to Address the Challenge of Disease Heterogeneity in Type 1 Diabetes, Diabetes Care, Jan 2020", co-authored by 17 of the world's most prominent key opinion leaders in the field, highlighted the existence of two disease endotypes of type 1 diabetes. These two endotypes were defined by the underlying autoimmunity associated with certain genotypes which is in line with our own findings described above regarding genetically defined subgroups.

There is consequently a strong and emerging case for precision medicine for type 1 diabetes where the aim is to zero in on the actual disease mechanism to tailor treatments for individual patients that are predicted to respond to the therapy. Precision medicine has already shown significant success in the oncology field where certain immunotherapeutic agents, most notably pembrolizumab (KEYTRUDA), target tumors that express specific biomarkers. It remains to be seen if the intralymphatic injections used in DIAGNODE-2 has the potential to work in a more broadly defined group of individuals with type 1 diabetes compared to subcutaneous injections, or if the upcoming results will also support the genetically defined responder subgroup.

To answer this question, the topline results from DIAGNODE-2 will comprise both the primary clinical endpoint and the most important secondary clinical endpoints, as well as the results for the genetically defined subgroups. These results will have an impact on the final design of any upcoming late stage development trials, including the patient population that we will target for the drug label.

This spring we also announced patent approvals in Europe and Japan for intralymphatic administration of Diamyd^®. The approval provides patent protection in these important pharmaceutical markets until 2035 and complements our US patent protection for the therapeutic use of GAD that is valid until 2032. Patent application for intralymphatic administration of Diamyd^® has also been granted in Australia and Russia, further strengthening our global patent portfolio.

In addition to the scientific, regulatory and operational progress with the diabetes vaccine Diamyd^®, we could recently release positive preliminary results from the first stage of the clinical trial with the GABA study drug Remygen^® which is ongoing at Uppsala University Hospital. Besides an improvement in glycemic control, treatment with Remygen^® surprisingly normalized the response to hypoglycemia in individuals with long term type 1 diabetes. Preventing hypoglycemia is a significant unmet medical need in type 1 diabetes and if these promising results are replicated, we may have an opportunity to broaden the therapeutic platform around GABA. The main stage of the trial is now ongoing where patients will be treated with both low and high dose of Remygen^® as well as with the combination of Remygen^® and the GABA receptor modulator Alprazolam.

We recently announced that, to further cement our control of the Diamyd^® asset, we are setting up our own facility in Umeå Sweden to manufacture GAD, the active component in Diamyd^®. The 10,000 square feet facility will give us the opportunity to work directly with licensing partners as well as to build and scale our own commercial manufacturing capabilities. Logistically it is also a perfect match since our drug formulator APL resides in the building next door.

Finally, in these COVID-19 times we are all reminded of the importance of strong drug safety profiles. Unlike other drugs being developed for autoimmune diabetes, Diamyd^® does not downregulate the immune system and therefore does not increase the risk of infections. Our diabetes vaccine has been evaluated without any safety concerns in trials encompassing more than 1,000 individuals, including healthy young children at risk of type 1 diabetes and in patients with recent-onset diabetes. This is a significant advantage going forward in our pursuit to achieve the best possible outcomes for patients with type 1 diabetes.

Stockholm, June 24, 2020

Ulf Hannelius, President and CEO

Two drugs in clinical development

Diamyd® and Remygen® are drugs in clinical development that focus on the underlying disease mechanisms of diabetes; the dysfunction and loss of insulin-producing beta cells in the pancreas.

Diamyd^® is an antigen-specific immunotherapy for the treatment of autoimmune diabetes (type 1 diabetes).

Clinical data indicate the potential of the diabetes vaccine Diamyd^® to halt or stop the autoimmune destruction of insulin-producing beta cells. The effect is achieved by antigen-specific reprogramming of immune cells by administration of low doses of Diamyd^® in superficial lymph nodes.

By maintaining the endogenous insulin production, Diamyd^® has the potential to make a significant difference in the daily life of patients as well significantly reduce the complications of type 1 diabetes.

Intralymphatic treatment with Diamyd^® is now being investigated in a clinical Phase IIb trial (DIAGNODE-2), with the aim of confirming the previously demonstrated clinical effect from a pilot trial in type 1 diabetes patients (DIAGNODE-1).

Remygen^® is an oral regenerative and immunomodulatory therapy for the treatment of autoimmune- and type 2 diabetes.

By stimulating the growth of insulin-producing cells, Remygen^® has the potential to reverse the disease progression in autoimmune- and type 2 diabetes.

Remygen^® is now being investigated in a clinical Phase I/II trial (ReGenerate-1), where clinical efficacy is evaluated with the aim of optimizing treatment ahead of registration-based trials.

Significant events during the third quarter:
Mar 1, 2020 - May 31, 2020

Results from clinical trial with Diamyd^® in children at high risk for type 1 diabetes

Results from the investigator initiated prevention trial DiAPREV-IT 2, where 26 healthy children at high risk for type 1 diabetes were treated with two subcutaneous injections of Diamyd^® or placebo, showed that over the course of two years, one individual in the Diamyd^® arm and two individuals in the placebo arm were diagnosed. No safety concerns were raised, and the safety profile was comparable between the active arm and the placebo arm. Mechanistic studies are still due to be conducted, and data from both DiAPREV-IT 1 and DiAPREV-IT 2 will be evaluated in a combined analysis.

Diamyd Medical fully subscribes to its pro rata share in NextCell Pharma's rights issue

Diamyd Medical announced that it will invest its pro rata share corresponding to approximately SEK 3.2 million in the associated company NextCell Pharma's ongoing rights issue, meaning that Diamyd Medical's book value of the holding in NextCell Pharma after the investment will increase from SEK 8.5 million to approximately SEK 11.7 million.

Promising findings from the first part of a clinical trial with Remygen^®

The initial safety and dose escalation part of the Phase I/II trial ReGenerate-1 with Remygen^® in individuals with long-term type 1 diabetes presented preliminary results showing that the trial participants' blood sugar control improved over the nine-day treatment period. The results also supported a surprising protective effect of Remygen^® during hypoglycaemia, that is, during sharply lowered blood sugar levels. The findings in the trial are patent pending. The independent Data Safety Monitoring Board (DSMB) has previously approved the commencement of the main part of ReGenerate-1, which among other things evaluates Remygens^® effect on restoring beta cell function.

The European and Japanese Patent Offices granted patent for intralymphatic administration of the diabetes vaccine Diamyd^®

The granted patents are valid until 2035 and provides central protection for the diabetes vaccine Diamyd^®. In particular, the patent protects the intralymphatic administration method that is being evaluated in the Phase IIb trial DIAGNODE-2 and which previously showed positive results in the Phase I/II trial DIAGNODE-1.

Vaccine manufacturing in Umeå

Diamyd Medical announced that a new manufacturing facility is being set up in Umeå by Diamyd Medical. The first priority of the new site is to receive the process technology for the manufacture of recombinant GAD65, the active ingredient in the therapeutic diabetes vaccine Diamyd^®.

New trial with Diamyd^® in autoimmune diabetes started recruiting patients in Norway

GADinLADA, the first clinical phase II trial with the diabetes vaccine Diamyd^® administered directly into the lymph node in patients with LADA started recruitment at the Norwegian University of Science and Technology in Trondheim (NTNU), in cooperation with St. Olav's University Hospital, Trondheim. The trial will also be conducted in Sweden at the Center for Diabetes, the Academic Specialist Center. In total, the trial encompasses 15 patients between the ages of 30 to 70 years diagnosed with LADA within the last 12 months who are not yet on insulin therapy.

Ongoing clinical trials

Type 1 diabetes is a devastating disease which requires daily treatment with insulin to sustain life. The importance of finding a drug that improves the prospects for patients with diabetes is of utmost importance. The effect of intralymphatic administration of Diamyd^®, an antigen-specific immunotherapy aimed at stopping the immune system's attack on insulin-producing beta cells in autoimmune diabetes, is evaluated in the Phase IIb trial DIAGNODE-2. Remygen^®, which aims to stimulate the growth of beta cells in patients with diabetes, is now evaluated in patients in a Phase I/II trial.

Trials with Diamyd® in lymph node

DIAGNODE -2 - DIAMYD^® IN LYMPH NODES WITH ORAL SUPPLEMENTATION OF VITAMIN D

A follow-up double-blind randomized clinical trial where Diamyd^® is administered directly into a lymph node with oral supplements of vitamin D. The trial encompasses 109 patients from Sweden, the Czech Republic, Spain and the Netherlands, aged 12-24 years who have recently been diagnosed with type 1 diabetes and will continue for a total of 15 months. As of autumn 2019, those patients who have not performed their last visit at 15 months are invited to participate in a nine months extension of the trial. 15-month results are expected to be presented in the third quarter of 2020. The aim of the trial is to evaluate the patients' remaining insulin producing capacity. Coordinating Investigator is Professor Johnny Ludvigsson at Linköping University, Sweden. Diamyd Medical is the Sponsor of the trial.

GADinLADA - DIAMYD^® IN LYMPH NODES WITH ORAL SUPPLEMENTATION OF VITAMIN D

An open-label, investigator initiated clinical trial where Diamyd^® is administered directly into a lymph node with oral supplements of vitamin D. The trial encompasses 15 patients aged 30-70 years diagnosed with LADA (Latent Autoimmune Diabetes in Adults) and not yet on inulin treatment. The aim with the trial is to evaluate the safety of intralymphatic treatment with Diamyd^®in LADA patients and to continuously evaluate the immunological and clinical response during a one-year period. Sponsor of the trial is the Norwegian University of Science and Technology with Ingrid K Hals as sponsor representative.

Trial with Remygen® (GABA)

REGENERATE-1 - REMYGEN^® /ALPRAZOLAM

An open-label, investigator initiated clinical trial with Remygen^®. The trial includes approximately 36 patients aged 18-50 who have had type 1 diabetes for more than five years with low to non-existing insulin production. The primary aim of the trial is to in a smaller dose escalation section evaluate the safety of Remygen^®. The main trial also evaluates whether the insulin-producing cells can be regenerated using Remygen^®, and in the combination of Remygen^® and Alprazolam. The trial is led by Professor Per-Ola Carlsson at Uppsala University, Sponsor of the trial.

*** The above is an excerpt from the report. To read the complete report, please visit https://www.diamyd.com , or see attached PDF ***

For more information, please contact:
Ulf Hannelius,
President and CEO
Phone: +46-736-35-42-41

Diamyd Medical AB (publ),
Kungsgatan 29,
SE-111 56 Stockholm, Sweden
Phone: +46-8-661-00-26
Fax: +46-8-661-63-68
E-mail: [email protected]
Reg. no: 556242-3797

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/diamyd-medical-ab/r/quarterly-report-iii-19-20,c3140489

The following files are available for download: