DIAMYD ANNUAL MEETING: BOARD OF DIRECTORS ELECTED. NEW CEO TO BE PRESENTED SHORTLY. COMPANY CONFIRMS IT IS ON TRACK TO FILE IND WITH THE FDA FOR PHASE III TRIAL THIS YEAR

Press Release, Stockholm, Sweden, December 11, 2007 – Diamyd Medical AB (www.omxgroup.com, ticker: DIAM B; www.otcqx.com, ticker DMYDY)

At the Annual General Meeting on December 11, held in Stockholm, it was confirmed that Diamyd Medical is on track to file an IND application for a phase III study with the FDA in the US before year end.

At the meeting the following members of Board of Directors were elected for the coming year:
• Lars Jonsson, BSc, Swedish Honorary Consul in Seattle, Founder and majority owner of the international group Stellar Holding (www.stellar.com). Mr. Jonsson plays an important role as a bridge between research and business in the US and Sweden and his established business contacts will be important to the Company’s growing presence in the US.

• Christer Hägglund, BSc, Stockholm, is majority owner of the NOMX-listed service company Proffice AB that recently has moved into the health care service sector. Mr. Hägglund’s experiences from public companies and as a businessman will be important as Diamyd moves its drug development program forward.

• Sam Lindgren, MD, Lund, has more than 14 years experience from leading positions within drug development within the areas of diabetes (Novo Nordisk), CNS (Lundbeck) and asthma (Astra). Dr. Lindgren’s broad experience will be particularly beneficial to Diamyd as its lead diabetes product moves through Phase III studies toward market approval.

• Anders Essen-Möller, Diamyd’s Founder and President for the past 13 years will step up from his Presidential role and assume the position as a full time working Chairman, which will allow him to focus on the Company’s strategic development.

At the meeting, it was also announced that former Board Director Professor Hans Wigzell, who has played an important role advising on the Company’s drug development strategy, will continue to provide important scientific advice to Diamyd Medical as a member of the Scientific and Medical Advisory Board (SAMAB).

“Compiling a Board of Directors with world class business, diabetes and CNS drug development expertise is vital as we enter the most exciting year in the Company’s history,” said Essen-Möller. “One very important task for the Board this year will be to closely watch and balance the Company’s financial position with the possibility that a partnership deal can be executed with established pharma as we are moving into registration studies. I am excited to work with the new President in my new role as working Chairman.”

At the meeting Essen-Möller informed that the new President and CEO will be presented tomorrow and that it is an individual with a strong biotech background that nicely adds to, reinforces and complements the present competences and leadership skills in the Company.

Michael Christini, President of Diamyd Inc. in Pittsburgh, reported that the IND application for a phase I study in patients with cancer pain is planned to be submitted to the FDA this year. “We believe that the NTDDS system for delivering pain relieving therapies has a large potential in situations such as neuropathy, spinal cord injury, cancer pain and shingles. Our NTDDS gene delivery vector specifically targets the sensory nerves providing local delivery of inhibitory genes which we believe should be quite effective in reducing pain,” Christini said.

The Company’s Income Statement and Balance Sheet were established and the Board of Directors and the Chief Executive Officer were discharged from liability for the financial year 2006/2007.

The meeting authorized the Board of Directors to resolve, at one or more occasions until the next Annual General Meeting, to issue new shares with consideration by set-off, in cash or other conditions and without regard to pre-emption rights. The total number of shares that can be issued based on this authorization shall not exceed 900,000 B-shares.

The meeting adopted the Board’s proposal for a new employee option program. The Company shall issue an employee option program free of charge with a validity of maximum three (3) years. The options shall be non-transferable and entitle the holder to subscribe for a share of series B at a value of 130 percent of the average share value on the Nordic Stock Exchange during five (5) days before the allotment. The conversion of the options should be conditioned by the employment or assignment at the time for vesting. Concerning employees in the USA, the conditions for receiving options shall be in accordance with the regulations for the state where issued.

To secure the employee option program it was decided to issue 200,000 warrants. Every warrant is entitled to a subscription of one (1) share of series B with validity until December 31, 2010. The Company shall retain warrants to cover the costs and taxes that the Company will be liable for at execution of the warrants. At full execution of all warrants the dilution is calculated to approximately 2 percent.

The meeting approved the Board of Directors’ proposal for principles for compensation and other terms of employment for the President and Chief Executive Officer of the Company and key executives.