SOUTH SAN FRANCISCO, Calif. ( TheStreet) -- U.S. regulators approved Monday a new drug from Roche ( RHHBY) and Curis ( CRIS) that treats a common but advanced form of skin cancer. The new drug, Erivedge, is the first therapy approved by the U.S. Food and Drug Administration for the treatment of advanced basal cell cancer. The FDA approved Erivedge well ahead of the drug's expected March 8 approval decision date and without the need for an advisory committee meeting. Roche's Genentech unit spearheaded the development of Erivedge, which was obtained under a licensing agreement signed with Curis. Curis shares initially spiked higher when news of Erivedge's approval crossed the tape but the stock is now down 9% to $4.73. Investors had bid up Curis shares significantly since last fall in anticipation of Erivedge's approval. Curis receives a $10 million cash payment from Roche for the drug's approval and will earn a relatively small single-digit royalty on the drug's sales. Erivedge will cost $7,500 per month or $75,000 for a typical 10-month course of treatment, Roche said. Basal cell carcinoma is generally a slow growing and painless form of skin cancer that starts in the top layer of the skin. It can be cured unless it spreads to other parts of the body. The cancer develops on areas of skin that are regularly exposed to sunlight or other ultraviolet radiation. Erivedge is a pill taken once a day and works by inhibiting the hedgehog pathway, a pathway that is active in most basal cell cancers and only a few normal tissues, such as hair follicles. FDA approved the drug based on results from a phase II study of 96 patients with with locally advanced or metastatic basal cell carcinoma. Of the patients with metastatic disease receiving Erivedge, 30% experienced a partial response and 43% of patients with locally advanced disease experienced a complete or partial response. The drug's most common side effects were muscle spasms, hair loss, weight loss, nausea, diarrhea, fatigue, distorted sense of taste, decreased appetite, constipation, vomiting, and loss of taste function in the tongue. "Today's approval provides a new treatment for people with advanced basal cell carcinoma who, until now, had no approved medicines to help shrink disfiguring or potentially life-threatening lesions,” said Dr. Hal Barron, Genentech's chief medical officer. --Written by Adam Feuerstein in Boston. >To contact the writer of this article, click here: Adam Feuerstein. >To follow the writer on Twitter, go to http://twitter.com/adamfeuerstein. >To submit a news tip, send an email to: email@example.com. Follow TheStreet on Twitter and become a fan on Facebook.