Swedish biopharmaceutical firm Medivir plans to start Phase III trials of its lead compound, the cold sore treatment ME-609, in the third quarter of 2006.

But taking the project forward on its own is a result of a decision to divest its portfolio of HIV and hepatitis B virus polymerase inhibitors, which will be bundled into a subsidiary company called Medivir HF and sold off. The portfolio includes MIV-210 in Phase II and MIV-150 in Phase I testing, both for HIV.

The company is retaining protease inhibitors in development for hepatitis C virus, osteoarthritis and autoimmune disorders, all of which have yet to start clinical development.

“Our decision to divest polymerase projects relating to HIV/HBV and shingles releases resources and creates a clearer operative focus,” said Lars Adlersson, Medivir’s chief executive.

ME-609 is a combination product based on two off-patent products, the antiviral acyclovir and corticosteroid hydrocortisone. Medivir says the combination product tackles both viral replication and inflammation, the two most important aspects of cold sores, and “has the potential to offer patients, for the very first time, the opportunity to completely avoid the outbreak of a cold sore.”

Medivir said the trials would cost only around 40 million Swedish kroner ($5m) and that the project was low-risk, as it involves two widely-used compounds with well-established safety profiles.