Meditech teams up to market skin cancer treatment

Meditech Research (ASX: MTR) and SkyePharma have completed a commercial pas-de-deux that sees them divide up the Pacific Rim markets for Solarase, a topical treatment for the pre-cancerous skin condition, actinic or solar keratosis.

Under the agreement, announced yesterday, London-based SkyePharma acquires the right to market Solarase in Australia and New Zealand.

Meditech CEO Chris Carter says that under the agreement, his company acquires reciprocal rights to market Solarase in the People's Republic of China, the world's most populous nation, and in Taiwan, Indonesia and the Philippines.

Skyepharma already markets Solarase in Europe and the US; the latter is the world's largest market for non-melanoma skin cancer treatments.

Solar or actinic keratoses (SK) are pre-cancerous, scaly areas of reddened skin that develop on exposed areas of the body, notably the face and the back of the hands, after repeated episodes of severe sunburn.

About one in five of Australia's 19 million people are predicted develop solar keratoses during their lifetime, and are at high risk of developing squamous-cell carcinoma as a consequence. Those numbers make Australia the world's second-largest market for skin cancer therapies, after the US.

A majority of the 300,000 Australians who have skin cancers removed each year have squamous cell carcinomas, the most common form of non-melanoma skin cancer. Rates for solar keratosis and other skin cancers, including melanma, are rising sharply in Europe, and especially in Britain, as more northern Europeans holiday in Spain and other Mediterranean countries with high UV radiation levels.

Solarase was developed by Canadian-based Hyal Pharmaceuticals in the late 1990s. When Hyal failed in 1999, administrators sold the rights for Solarase to Skypharma - except for those already owned by Meditech, under a pre-existing agreement with Hyal Australia.

Meditech has now ceded the rights to the Australian and NZ market to Skyepharma, in return for an up-front payment, a milestone payment when the TGA approves Solarase for sale in Australia and NZ, plus a royalty on sales in those countries.

Used topically, Solarase has been shown to completely resolve or reduce solar keratoses in around 80 per cent of SK patients. Its active ingredient, diclofenac sodium, is a potent inhibitor of the natural inflammatory agent prostaglandin E2. In Solarase, it is mixed with the natural hydrating/sikn softening agent, hyaluronidase.

SkyePharma CEO Michael Ashton said Australia was an important market for the company.

"We will conduct an additional clinical study in Australia before pursuing rapid product registration using our clinical and regulatory expertise, whilst seeking a commercialisation partner to maximise market penetration," Ashton said.