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|  |  Diamyd Medical broadens diabetes pipeline with acquisition of Nurel TherapeuticsPress Release December 13, 2005 Stockholm, Sweden - 13 December 2005 - Diamyd Medical AB (OMX: DIAMB) emerged as a global biotechnology company as shareholders approved the acquisition of Nurel Therapeutics Inc at a General Assembly Meet ing in Stockholm yesterday. The Pittsburgh, PA- based biotech adds significantly to Diamyd Medical's pipeline for diabetes which now includes both a therapeutic vaccine for autoimmune type 1 and type 2 diabetes as well as therapies for diabetic pain. The merger is expected to close on Friday, December 16. Diamyd shareholders approved the issuance of common stock to Nurel shareholders in connection with the merger. Nurel shareholders will receive a total of about 223,208 Diamyd B shares. This reflects an assumed Diamyd B share value of SEK 55, which corresponded to a 15% premium as of the deal signature date the 21st of November. In addition, Diamyd shareholders approved the issuance of an additional approximate 110,000 Diamyd shares against convertible loans used previously to finance Nurel, which in total represents a dilution of about 4% to Diamyd shareholders. The merger will create strong synergies between Diamyd Medical and Nurel, while having little effect on Diamyd's financial position and burn rate. "Nurel and Diaymd Medical both work in diabetes and both have a GAD-based lead compound. We differ in that the GAD is used for two totally different and non-overlapping aspects of diabetes: (1) the treatment of the actual disease itself, and (2) the treatment of pain resulting from diabetes. The acquisition of Nurel brings a tremendous amount of synergy to the table, which makes the deal very attractive and beneficial to our shareholders," says Anders Essen-Moller, President and CEO of Diamyd Medical. Michael Christini, president of Nurel Therapeutics noted, "This is a significant milestone for both companies. The merger creates a global biotechnology company with combined portfolios with a strong diabetes franchise aimed not only at treating diabetes but also the complications associated with the disease, including peripheral nerve pain. We are enthusiastic for the synergies this merger will create and look forward to advancing the product portfolio through the clinic in both Europe and the U.S." Nurel has previously received convertible debt funding from Pittsburgh-based investment groups including UPMC Health Ventures, a venture fund owned by UPMC, the premier health system in Western Pennsylvania, USA. Nurel has also received convertible debt funding from Innovation Works, an economic development organization in Western Pennsylvania and from the Pittsburgh Life Sciences Greenhouse, a Western Pennsylvania public/private partnership that invests in and supports the growth of life sciences companies. "It's gratifying to see the cutting edge technologies and treatments developed at the University of Pittsburgh find their way into the mainstream," said Chuck Bogosta, Managing Director of the University of Pittsburgh Medical Center's Strategic Business Initiatives. "UPMC is pleased to have been an early investor in Nurel. The treatments developed at the university will benefit diabetes patients everywhere, and we look forward to the new venture flourishing. We are particularly happy that Diamyd has chosen to open its North American headquarters in the Pittsburgh region because we believe strongly that it is an area that has the medical and entrepreneurial resources needed to help Diamyd's enterprises continue to grow." For complete press release, go here: http://www.biotech-intelligence.com/html/html/f4a105ebd77be0381e12342f10348198.html
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