A promising new insulin pill is just several months away from being trialled by people living with diabetes in Australia.

Billed as an alternative to insulin injections, the Australian creators of the insulin pill were handed a million-dollar government grant to help take their discovery from the lab to the clinic.

"We get to find out now if it really does work in type 1 diabetes and we couldn't be more excited to have that happen," Endo Axiom chief executive Dr Nicholas Hunt said.

Nanotechnolgoy, the key to the creation of the insulin pill, is shown to be safe and effective in animal studies.

The pill is designed with three layers to help the absorption of insulin.

"For us, the unique aspect of this technology is that it's both a pill and a smart insulin," Hunt said.

"No-one has taken it to clinical trials with that combination before."

Hunt said a "smart insulin" can respond to a patient's glucose levels and turn on when the glucose is high, or turn off when it becomes too low.

It's a personal mission for researcher Sophie Kang, who lives with type 1 diabetes.

"It will make things more simplified [and] can also remove the stigma people have," Kang said.

Human trials are expected to start in the new year.

Endo Axiom is one of 14 Australian start-ups injected with a total of $12 million from the government to fund the development of new medical devices and drugs.

"We have a great history in Australia of medical research but too often our discoveries are sent overseas," Federal Health Minister Mark Butler said.

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