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SkinMedica(R) Announces New Debt Facility and FDA Acceptance of Its New Drug Application for Desonate(TM)

Posted on: Thursday, 22 June 2006, 00:00 CDT

SkinMedica, Inc., a specialty pharmaceutical company focused on developing, acquiring and commercializing products that improve the appearance of skin and treat dermatologic conditions and diseases, today announced that it has closed a $20.5 million debt facility, consisting of a $13.0 million Term Loan and a $7.5 million Revolving Line of Credit, with Merrill Lynch Capital, a division of Merrill Lynch Business Financial Services, Inc.

"This facility will provide us with the resources necessary to continue to execute our business strategy," stated Rex Bright, President and CEO.

The Company also announced that the U.S. Food and Drug Administration (FDA) had previously accepted for filing the Company's New Drug Application (NDA) for Desonate(TM) (desonide gel) 0.05% for the treatment of atopic dermatitis.

Desonate is a topical formulation containing the low-potency steroid desonide, which utilizes a proprietary alcohol-free, aqueous gel delivery vehicle (HydroGel(TM) Technology) to treat atopic dermatitis.

"The acceptance of this NDA represents a milestone for SkinMedica," said Bright. "If approved by the FDA, this product, which resulted from a collaboration between SkinMedica and Dow Pharmaceutical Sciences, will offer dermatologists and their patients, particularly younger children, a product with enhanced properties which we believe will lead to increased patient compliance and satisfaction."

The NDA submission for Desonate was based on the results of two pivotal Phase III clinical trials, which enrolled 582 patients at 46 clinical centers across the United States. Patients in the clinical trial ranged from 3 months to 18 years of age. The clinical trials were designed to demonstrate the superiority of Desonate compared to vehicle (placebo) without desonide. Patients received either Desonate or placebo twice daily for four weeks. The results of these two clinical trials demonstrated a highly statistically significant treatment effect for Desonate compared to placebo (p value of less than 0.001).

In addition, a study evaluating the safety and systemic tolerance of Desonate was conducted in pediatric patients with moderate to severe atopic dermatitis. This study measured the effects of Desonate on the hypothalamic-pituitary-adrenal (HPA) axis in 40 patients ranging in age from 3 months to five years, 11 months. At the four week follow-up visit, cortisol levels in these pediatric patients were within normal limits with no incidence of suppressed adrenal function reported. SkinMedica believes that this supports the safety and systemic tolerance of the Desonate formulation.

Low potency steroids are widely used to treat atopic dermatitis in both adults and children. These products are primarily prescribed by dermatologists, pediatricians and primary care physicians. Prescriptions for low potency topical steroids currently account for approximately 7.7 million prescriptions annually. Approval of Desonate(TM) (desonide) would provide SkinMedica with its first steroid product in the $1.1 billion dollar topical steroid market. SkinMedica believes that the HydroGel(TM) Technology delivery system may have important patent benefits compared to more conventional drug delivery vehicles. Conventional steroid formulations including gels and foams typically contain alcohol that may be irritating to patients with atopic dermatitis. HydroGel, an aqueous-based and alcohol-free system, has been developed by Dow Pharmaceutical Sciences to provide patent benefits as a functionally and cosmetically acceptable delivery system.

The filing of an NDA with the FDA is an important step in the approval process in the United States. Acceptance for filing by the FDA does not mean that the NDA has been or will be approved, nor does it represent an evaluation of the adequacy of the data submitted.

About SkinMedica

SkinMedica is a privately held specialty pharmaceutical company marketing both prescription and cosmeceutical dermatology products. SkinMedica's EpiQuin(R) Micro (4% Hydroquinone) treats melasma and postinflammatory hyperpigmentation, VANIQA(R) (eflornithine hydrochloride) Cream, 13.9%, is the only FDA-approved prescription product for the treatment of unwanted facial hair in women, and NeoBenz(R) Micro, which contains a patented gradual-release formulation of benzoyl peroxide, treats acne. The company's full line of cosmeceutical products, which is sold through physicians, includes TNS Recovery Complex(R) with NouriCel-MD(R) to help improve the health and appearance of aging skin. SkinMedica is based in Carlsbad, California. For more information, visit: www.skinmedica.com.

EpiQuin(R) Micro, NeoBenz(R) Micro, NouriCel-MD(R), SkinMedica(R), TNS Recovery Complex(R) and VANIQA(R) are trademarks of SkinMedica, Inc.

About Merrill Lynch Capital

Merrill Lynch Capital, a division of Merrill Lynch Business Financial Services Inc., is a leading commercial finance business providing a broad range of structured financing solutions to middle market companies nationwide. Based in Chicago and with regional offices throughout the country, Merrill Lynch Capital is focused on four market segments-corporate finance, equipment finance, healthcare finance and real estate finance. The Healthcare Finance Group of Merrill Lynch Capital provides senior financing solutions for middle market healthcare companies, offering cash flow, asset, life sciences related and real estate based credit facilities and junior secured debt, and equity co-investments. The typical transaction size for senior debt is between $10 million and $250 million.

Source: Business Wire

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