Israeli dermatological product developer Foamix Ltd. is due to bring its first products to the market sometime in the middle of next year. If all goes according to plan, these products will be the start of a flood of new developments that will reach the market in stages, at a rate of around 3-4 products a year.

It’s no surprise to learn that co-founder and principal Dr. Dov Tamarkin was formerly senior section R&D manager at Teva Pharmaceutical Industries Ltd.  As with his former company, Foamix also has a precise long-term product launch plan despite the fact that it has yet to launch its first product.

Foamix’s technology is apparently simple. The company has managed to develop several types of foam for substitutes to ointments containing medications for treating skin complaints. Co-founder and COO Meir Eini explains why this is no trivial matter. “One third of the population in the West visits a dermatologist every year, and ointments are the principal method for treating skin complaints. Most of these ointments are unpleasant, are often foul-smelling, and need to be applied to exposed surfaces. Sometimes the ointment has to be applied to a very large area, which makes it impossible to put on clothing, sit down, or go to sleep until the ointment has been absorbed.”

The advantage of Foamix’s foam is not just that it is a foam-based product but also because it is easily absorbed in the skin. The company has managed to develop a foam with a water or oil base, or an oil emulsion in water and vice versa, so that the overwhelming majority of drugs can be dissolved in its foam bases. “We have managed to produce an alcohol-free foam that has no water, something which no one thought was possible until now,” says Eini.

The absence of alcohol is an important issue for Foamix, since alcohol is a key ingredient in the products of the company’s only competitor in foam-based applications, Connetics Corp. “Alcohol irritates the skin and is therefore unsuitable for most skin problems,” says Tamarkin. “An alcohol-based foam evaporates easily at body temperature, so it’s difficult to apply it over large areas. The company’s directions for use are to transfer the foam to a bowl and then quickly apply it to small areas. Despite the obvious disadvantages, the product is selling extremely well, it costs $80 compared with $20 for the same product in ointment form. When it was first launched in 2002, sales totaled $40 million, and reached $100 million by 2005.”

Cooperation with leaders in the field

Foamix believes, naturally, that it will go even further. The company has adopted a twin-track policy. It is developing in-house products that combine the foam base and generic drugs without the involvement of the companies which developed them. At the same time, it is also forming collaborative agreements with leading international companies, including several leaders in dermatological products such as Stiefel Laboratories Inc., and Leo Pharma, and a number of other companies whose names Foamix will not disclose.

Likewise, the company is co-developing with Israeli pharmaceutical company Trima-Israel Pharmaceutical Products Ltd, a non-medicinal product for the treatment of diaper rash. This is a skin irritation caused to babies by the dampness of urine combined with the friction of the diaper on the skin. The solution currently available is an ointment which is placed inside the diaper. It will be Foamix’s first product to reach the market, first in Israel at the beginning of 2007, and then in the US by the middle of the year. The company also hopes to cooperate with other companies in the marketing of the products it is currently developing on its own, and it does not intend to set up an independent distribution operation for these products.

Two additional products that are due to come onto the market in 2007 are a product for treating extremely dry skin and a product for treating atopic dermatitis which mainly affects children. These two products do not require clinical trials. This is likely to be followed in 2008 by a product developed independently by Foamix for the treatment of lice. This product will require minimal clinical trials.

Foamix is jointly developing with Stiefel a foam for the treatment of scabies. This will be the real breakthrough year for Foamix, which will unveil three more products jointly developed with other companies. These are a treatment for Rosacea, which it is co-developing with a company whose name it does not wish to disclose at present; a treatment for psoriasis, which it is co-developing with Leo Pharma; and a product for fungal infections, also being developed together with an unnamed partner.

Foamix is also due to launch in the same year two more independently developed products, a product for joint pain, and a product named Beta Foam. The 2009 timeline for these products is a conservative estimate, although it should be remembered that life science developments can always be subject to delays.

En-route to Nasdaq?

Foamix was founded in 2003, but its current cooperation programs have already produced considerable revenue, following the achievement of milestones. These enabled the company to reach a positive cashflow in the latest quarter. “We believe that we will post a net profit in 2006,” says Eini. “The royalty and milestone payments we have received are similar to those paid for a new molecule. This is how the market estimates the contribution made by the foam to the final market price.

”Foamix has raised only $5 million to date, from private investors, professional venture capital executives who do not operate through the funds,” adds Eini. “We still have half of this sum. As befitting a life-science company with revenue, young as it may be, Foamix is considering an IPO on Nasdaq. We are preparing the company for an IPO, that is to say, we are adopting strict documentation and accounting procedures and have ongoing contacts with investment banks. However, we are not sure if this is the way we want to use to raise finance, if at all.”