Andromeda Biotech Ltd. announces the results from an Extension Study to its Phase III Clinical trial in type 1 diabetes patients treated with DiaPep277®.

The open label, 24 month extension study was designed to evaluate long term safety, tolerability, and efficacy of DiaPep277® for two additional years following the completion of the Phase III study, DIA-AID 1 in November 2011.

43 patients who completed two years in the DIA-AID 1 study and who had residual beta cell function (stimulated C-peptide over 0.2 nmol/L) were enrolled into the open label extension study at three medical centers in Israel. The patients were all treated with 1 mg of DiaPep277® quarterly for two consecutive years. Of the patients that completed the double blind phase of DIA-AID 1, 28 patients were in the active treatment group (hence completed 4 years of drug therapy) and 15 patients were in the control group (hence received 2 years of drug therapy).

DiaPep277® was well tolerated with a good safety profile, which was similar to that observed in the DIA-AID 1 study. No drug related serious adverse events were reported. No difference was observed in the frequency of adverse events between the two groups and there were no signs of immune reactivity or immune suppression.

Patients who were treated with the drug for four years from the time of diagnosis demonstrated a better ability to secrete insulin as compared to patients who started treatment after a period of more than two years from diagnosis showing a relative treatment effect of 30%. In addition, these patients maintained better glycemic control compared to the patients treated for two years. In the patients who were treated for four years, the average HbA1c level was 7.0% compared to 7.6% in the patients who were treated for two years. The rate of hypoglycemic events and the Mean Amplitude Glucose Excursion were lower in the patients who were treated for four years (-0.93 versus -0.06, and 66 mg/dL versus 113 mg/dL respectively).

A higher proportion of patients maintained good metabolic control. 50% were in the group treated for four years compared to 28.6% in the group who were treated for two years and maintained HbA1c ≤ 7% at the end of the study. 37% versus 13% were in partial remission (HbA1c ≤ 7% and insulin daily dose ≤ 0.5 U/Kg).

The trial demonstrates that long-term treatment with DiaPep277® has a favorable safety profile and is effective in maintaining good metabolic control in type 1 diabetes patients. It confirms earlier assumptions that patients with residual beta cell function who are treated with DiaPep277® close to diagnosis may benefit better from the treatment.

Prof. Itamar Raz, Head Diabetes Unit, Department of Medicine, Hadassah University Hospital, Jerusalem and Chairman of the Steering Committee of the study commented: "These results are extremely encouraging indicating a significant advancement in the area of immune intervention in Type 1 diabetes. The clear trend towards improving metabolic control gives new hope to patients who suffer from Type 1 diabetes."

About DiaPep277® DiaPep277®, a unique peptide of 24 amino acids derived from the sequence of the human heat shock protein 60 (Hsp60), was invented by Prof Irun Cohen and his team at the Weizmann Institute of Science. The peptide acts by modulating the immune system, thus preventing the destruction of pancreatic cells that secrete insulin and preserving their natural function. Treatment of type 1 diabetes patients with DiaPep277® may have several medical benefits including slowing the deterioration of the disease, improved metabolic control, reduction of daily insulin dose requirements, and reduction of diabetic complications. About Andromeda Andromeda Biotech Ltd., a subsidiary of Clal Biotechnology Industries Ltd. (TASE:CBI), is focused on the development of an innovative treatment for autoimmune diabetes. Andromeda's DiaPep277®, currently in Phase III Clinical Studies, is a novel therapeutic approach to treat type 1 diabetes. For more information about Andromeda Biotech please visit our site at www.andromedabio.com

CONTACT: Shlomo Dagan, PhD
         CEO
         Andromeda Biotech Ltd.
         Phone: +972 8 9387777
         E-mail: info@andromedabio.com