Pharmaceuticals giant GlaxoSmithKline has signed an agreement to buy eczema treatment drug 'Toctino' from Basilea Pharmaceutica.

Toctino, otherwise known as 'alitretinoin', is a prescription-only, once-daily, oral retinoid used for severe chronic adult hand eczema which is unresponsive to other potent topical steroids. Available in 14 countries and approved in 15, it is in a Phase 3 trial in the US. Total sales in 2011 amounted to £22m.

Stiefel, a subsidiary of Glaxo, will buy all Toctino patent rights, trademarks and product registrations owned by Basilea for an initial payment of £146m in cash. If the FDA approves Toctino and the drug receives double-digit success payments on US net sales three years after its launch, Stiefel will pay a further £50m.

Stiefel will license certain clinical information and product know-how from Basilea and will be responsible for the product's development, manufacture and commercialisation worldwide.

"Toctino is an important and growing product that complements the Stiefel portfolio and offers a proven therapy for patients with a significant unmet medical need," said Steifel's President Simon Jose.

"This acquisition gives us an immediate opportunity to develop and expand the availability of this new and innovative product of value and reinforces Stiefel and GSK's commitment to dermatology."

The transaction is subject to competition approval in Germany.

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