DiaMedica Announces Development Update

DiaMedica Inc. (TSX VENTURE:DMA), a clinical stage biopharmaceutical company
focused on the treatment of diabetes and its complications, today provided a
development update on its lead product candidates, DM199 and DM204. The Company
also announced it intends to expand the testing of DM199 in diabetic kidney
disease patients while also developing DMDx, a companion diagnostic for kidney
disease.


"We believe there is a significant need for more effective therapies for
diabetes and diabetic kidney disease, particularly as the prevalence of these
diseases rises," explained Mr. Rick Pauls, President and CEO of DiaMedica. "We
look forward to further advancing the development of our programs for diabetes
while expanding into diabetic kidney disease and other associated diseases with
DM199."


DM199 - Type 2 diabetes

DiaMedica's lead product, DM199, is a novel recombinant human tissue
kallikrein-1 (rhKLK1) therapy for the treatment of diabetes (type 2 and type 1
diabetes) and its associated complications. To date, DM199 has been administered
to more than 80 healthy volunteers and type 2 diabetic patients. DM199 treatment
has been generally safe and well tolerated, and the pharmacokinetic profile
supports infrequent administration. The Company is currently conducting a 28-day
Phase 2 clinical study in 36 type 2 diabetic patients. The primary clinical
endpoints are to assess the safety and tolerability of DM199 while also
measuring changes in diabetes markers. Twenty-four of the 36 type 2 diabetic
patients have completed the Phase 2 study. The study is expected to be fully
complete this summer with results to follow in the fall of 2014.


DM199 - Diabetic Kidney Disease

Diabetic kidney disease (DKD) is one of the major complications of diabetes.
Currently prescribed therapeutics for DKD only slow the progressive decline in
renal function, and there is a major unmet need for novel therapeutics that
prevent costly dialysis and/or kidney transplantation. DiaMedica is preparing
for upcoming clinical studies that will expand the testing of DM199 to patients
with DKD. Published preclinical data suggests that modulation of the
kallikrein-kinin system has broad protective effects against the metabolic and
vascular abnormalities associated with DKD, and that therapy with human tissue
kallikrein-1 improves several parameters of kidney function.


DMDx - Kidney diagnostic

DiaMedica is developing a companion diagnostic assay, DMDx, utilizing the
detection of tissue kallikrein-1 as a biomarker in human urine to identify DKD
patients who are most likely to respond to a therapy including DM199. The
Company anticipates that the identification of target populations based on
tissue kallikrein-1 will significantly de-risk clinical DKD drug development.
The assay is currently in the development stage, with the near-term goal of
analytical validation, followed by longer-term clinical validation. The Company
believes that DMDx may fulfill the unmet need for validated clinical biomarkers
that can predict the rate of disease progression to end-stage renal disease
(kidney failure) in patients with DKD.


DM204 - Type 2 diabetes

DM204 is a novel monoclonal antibody for the treatment of type 2 diabetes and
associated complications including hypertension (high blood pressure). DM204 is
currently in the preclinical stage of development with plans to move into
manufacturing and toxicology testing upon completion of preclinical testing.


For further information, please visit www.diamedica.com

About DiaMedica

DiaMedica is a publicly traded (TSX VENTURE:DMA) clinical stage
biopharmaceutical company focused on the discovery and development of novel
therapies to treat diabetes and the complications associated with diabetes.
DiaMedica's lead clinical-stage product, DM199, is a recombinant human protein
known as rhKLK1 that represents a novel approach to treating diabetes and
associated complications. DiaMedica is also developing DM204, a
preclinical-stage monoclonal antibody, for the treatment of type 2 diabetes.


DiaMedica's common shares are listed on the TSX Venture Exchange in Canada under
the trading symbol 'DMA'.


FORWARD-LOOKING STATEMENTS

The statements made in this press release that are not historical facts contain
forward - looking information that involves risk and uncertainties. All
statements, other than statements of historical facts, which address DiaMedica's
expectations, including the intended use of the net proceeds of the Offering,
should be considered forward-looking statements. Such statements are based on
management's exercise of business judgment as well as assumptions made by and
information currently available to management. When used in this document, the
words "may", "will", "anticipate", "believe", "estimate", "expect", "intend" and
words of similar import, are intended to identify any forward-looking
statements. You should not place undue reliance on these forward- looking
statements. These statements reflect a current view of future events and are
subject to certain risks and uncertainties as contained in DiaMedica's filings
with Canadian securities regulatory authorities. Should one or more of these
risks or uncertainties materialize, or should underlying assumptions prove
incorrect, actual results could differ materially from those anticipated in
these forward -looking statements. DiaMedica undertakes no obligation, and does
not intend, to update, revise or otherwise publicly release any revisions to
these forward-looking statements to reflect events or circumstances after the
date hereof, or to reflect the occurrence of any unanticipated events, unless
required by law. Although management believes that expectations are based on
reasonable assumptions, no assurance can be given that these expectations will
materialize.


Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of the contents of this press
release.


FOR FURTHER INFORMATION PLEASE CONTACT: 
DiaMedica Inc.
John Savage
Chief Financial Officer
763-270-0603
[e-mail]


DiaMedica Inc.
One Carlson Parkway, Suite 124
Minneapolis, MN


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Thomas Hoffmann
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