Overview

DiaMedica Therapeutics (Nasdaq:DMAC) is a clinical-stage biopharmaceutical company developing novel recombinant (synthetic) proteins. The Company is using its patented and licensed technologies to establish the Company as a leader in the development and commercialization of novel recombinant proteins to treat kidney and neurological diseases. The primary focus is on chronic kidney disease ("CKD") and acute ischemic stroke ("AIS"). The Company is advancing its lead drug candidate, DM199, through clinical trials, as appropriate, to create shareholder value by establishing its clinical and commercial potential as a therapy for AIS and CKD.

DM199 is a recombinant form of the KLK1 protein. KLK1 is an endogenous serine protease (protein) produced in the kidneys, pancreas and salivary glands, which plays a critical role in the regulation of local blood flow and vasodilation (the widening of blood vessels which decreases blood pressure) in the body, as well as an important role in managing inflammation and oxidative stress (an imbalance between potentially damaging reactive oxygen species, or free radicals, and antioxidants in your body). The Company believes DM199 has the potential to treat a variety of diseases where healthy functioning requires sufficient activity of KLK1 and its biochemical system.

CKD and AIS patients suffer from a lack of blood flow to the brain and kidneys, respectively. These patients also tend to exhibit lower than normal levels of endogenous KLK1. The Company believes treatment with DM199 could replenish low levels of endogenous KLK1, thereby generating beneficial nitric oxide and prostacyclin setting in motion metabolic pathways that can improve blood flow (through vasoregulation) to damaged end-organs, such as the brain and kidneys, supporting the structural integrity and normal functioning.

Today, forms of KLK1 derived from human urine and porcine pancreas are sold in Japan, China and Korea to treat AIS, CKD, retinopathy, hypertension and related vascular diseases. The Company believes millions of patients have been treated with these KLK1 therapies, and the data from more than 100 published papers and studies support their clinical benefit. However, there are numerous regulatory, commercial, and clinical drawbacks associated with KLK1 derived from human urine and porcine pancreas that can be overcome by developing a synthetic version of KLK1 such as DM199. DiaMedica believes regulatory drawbacks are the primary reason why KLK1 derived from human urine and porcine pancreas are not currently available and used in the United State or Europe. The Company is not aware of any synthetic version of KLK1 with regulatory approval for human use in any country, nor is the Company aware of any synthetic version in development other than our drug candidate DM199. The Company believes at least five companies have attempted to create a synthetic version of KLK1, but have been unsuccessful.

DiaMedica has conducted numerous internal and third-party analyses to evaluate the structural and functional performance of DM199 as compared to KLK1 derived from human urine. The results of these studies have demonstrated that DM199 is structurally and functionally equivalent to KLK1 derived from human urine in that (i) the amino acid structure of DM199 is identical to the human urine form, (ii) the enzymatic and pharmacokinetic profiles are substantially similar to human urinary derived KLK1 and (iii) the physiological effects of DM199 on blood pressure mirror that of human urinary derived KLK1. The Company believes that the results of this work suggest that the therapeutic action of DM199 will be the same or better than that of the forms of KLK1 marketed in Asia. In addition, DiaMedica has completed five clinical trials with DM199 treating over 120 volunteers and the results have shown that DM199 has been well-tolerated.