Zealand Pharma

Regulatory Filings • Jun 10, 2016

-- Synergistic match of Beta Bionics’s dual-hormonal, artificial, or bionic,
pancreas device platform, the iLet, and Zealand’s novel liquid stable
glucagon analog, ZP4207
-- An automated insulin + glucagon delivery system with integrated continuous
blood glucose monitoring and mathematical dosing algorithms offers the
potential for a paradigm shift in the treatment of diabetes
-- Expected next step under the collaboration is the initiation of clinical
trials in H2 2016
-- Zealand’s financial guidance for 2016 remains unchanged

Copenhagen, Denmark and Boston, Massachusetts, 10 June 2016 – Zealand Pharma,
or Zealand, a peptide drug discovery, design and development company, and Beta
Bionics, a medical technology company, jointly announced today that they have
engaged in a collaboration. The objective of the collaboration is to combine
essential proprietary product rights from each party to advance a new
dual-hormonal artificial, or bionic, pancreas system to the next step in its
clinical development. Such a system has the ultimate potential to offer people
with diabetes on insulin therapy more efficacious, safer, and easier blood
sugar control for better long-term disease management and outcomes.

The new system under the collaboration is based on an advanced bionic pancreas
platform technology, developed at Boston University and Beta Bionics, which has
been integrated into a pocket-sized wearable medical device, called the iLet.
Boston University has granted an exclusive worldwide license of the iLet
technology to Beta Bionics. The bionic pancreas technology in the iLet is
designed for automated delivery of both insulin and glucagon analogs and has
been tested and refined in nearly 10 years of clinical trials. All of these
trials used recombinant human glucagon, which necessitated daily reconstitution
at the point of care.

In future trials, Zealand will evaluate a multiple-dose version of its
proprietary novel glucagon analog, ZP4207, with the iLet. ZP4207 is invented
and developed by Zealand and has been shown to have a unique stability profile
for use in liquid formulation.

Britt Meelby Jensen, President and Chief Executive Officer of Zealand: “We are
truly excited about our collaboration with Beta Bionics. It allows us to
evaluate our novel liquid glucagon, ZP4207, in the clinic for use in the
state-of-the-art iLet device developed by Beta Bionics and Boston University. I
believe we stand in front of a unique opportunity to develop a system for
automated delivery of both insulin and glucagon and with the potential to offer
a paradigm shift in the treatment of diabetes. Together with Beta Bionics, we
have a vision of making the iLet device and our novel liquid formulation
glucagon available for people with diabetes as soon as development timelines
allow, and we look forward to starting our first joint clinical trials in
people with type 1 diabetes later this year.”

Professor Ed Damiano, co-developer of the iLet technology, Professor of
Biomedical Engineering at Boston University, and President and Chief Executive
Officer of Beta Bionics, added: “We have long awaited and eagerly anticipated
the development of a stable pumpable glucagon analog suitable for chronic use
in our dual-hormone bionic pancreas. This has proven to be a challenging task.
We are therefore very pleased that Beta Bionics now has access to Zealand’s
novel investigational glucagon analog, and that Zealand now has our bionic
pancreas platform to administer it. We at Beta Bionics and Zealand share a deep
appreciation for the synergy that comes from combining our two complementary
technologies. Our collaboration is fueled by a common commitment to bring about
a paradigm shift in diabetes management, and to fulfill the promise and
potential that our partnership holds for the health and well-being of people
with type 1 diabetes and their families.”

People with type 1 diabetes have impaired pancreatic function. They suffer from
insulin deficiency and inappropriate and inadequate glucagon secretion – both
endogenous hormones are essential to ensure stable and healthy blood glucose
metabolism. People with type 1 diabetes depend on a complicated daily insulin
regimen to control hyperglycemia (high blood glucose levels) and carbohydrates
to manage hypoglycemia (low blood glucose levels). They must constantly track
and adjust their blood sugar levels to remain healthy and reduce the chronic
and acute risks associated with hypo- and hyperglycemia. Today, many people
with type 1 diabetes are on insulin pump therapy to control their blood sugar
levels. A dual-hormone bionic pancreas, which automatically determines both
insulin and glucagon doses and then delivers insulin and glucagon analogs, can
much more faithfully mimic the function of a healthy pancreas and significantly
improve diabetes management, relative to insulin pump therapy. A fully
automated system would at the same time offer a significant relief to people
with type 1 diabetes. A scalable commercial dual-hormone system has so far
remained elusive, due to the lack of a stable, pumpable, liquid formulation of
either glucagon or a glucagon analog product.

In out-patient and home-use randomized cross-over trials, the bionic pancreas
technology that has been integrated into the iLet, has shown significant
reductions in blood glucose levels, reductions in hypoglycemia, and reductions
in intersubject as well as intrasubject glycemic variability in adults,
adolescents, and pre-adolescents with type 1 diabetes (New England Journal of
Medicine. 2014, 371:313–25; Lancet Diabetes and Endocrinology. 2016, 4:233–43).
These trials have been conducted in collaboration with endocrinologists at the
Massachusetts General Hospital, Stanford University, the University of
Massachusetts Medical Center, and the University of North Carolina.

Zealand has evaluated ZP4207 in Phase Ia and Phase Ib single and multiple
ascending dose trials. In these trials, ZP4207 was observed to be safe and well
tolerated with the ability to provide a clinically relevant blood glucose
response.

Zealand and Beta Bionics expect as a next step in their collaboration to
initiate a Phase IIa clinical trial to test safety and efficacy of ZP4207 when
used in the iLet. The trial is expected to enroll the first patients with type
1 diabetes in H2 2016.

Zealand retains its financial guidance for 2016

The collaboration with Beta Bionics and the clinical activities expected to be
initiated in H2 2016 for ZP4207 when used in the iLet will not change Zealand’s
financial guidance for 2016.