This is phase 1 placebo controlled study to evaluate the safety, tolerability and pharmacokinetics of XG004 applied topically in participants with osteoarthritis of the knee

The study will consist of a 4-week Screening period, an 7-day Treatment period and a 7-day Safety follow-up period that will be conducted by telephone for each Cohort.

Up to 32 participants with OA of the knee will be enrolled into 6 cohorts sequentially and assigned treatment on a 3:1 (XG004: placebo) ratio.

Inclusion Criteria:

1. Participant must be 40 to 75 years of age inclusive, at the time of signing the informed consent form.
2. Body Mass Index (BMI) of 18 to 39, inclusive, at the time of Screening visit.
3. Participant who is diagnosed with primary knee OA fulfilling the American College of Rheumatology (ACR) Clinical and Radiographic criteria for ≥ 26 weeks prior to Screening visit.
4. Kellgren-Lawrence Grade II to IV as confirmed by X-ray during Screening visit or within 6 months prior to Screening visit in the study knee.
5. The average daily walking pain scale in the study knee over Day -4 to Day -2 during the Baseline period must be ≥ 4.0 on NRS 0-10 scale.

Exclusion Criteria:

1. Participants with any systemic or dermatological disorder that may interfere with the evaluation of the test site reactions (e.g., atopic dermatitis, contact eczema, psoriasis).
2. Participants with scars, moles, tattoos at application site or other abnormal pigmentation of the skin or skin type that may, in any way, confound interpretation of the study results.
3. Participants with any of the following conditions on the test area: viral (e.g., herpes or varicella) lesions of the skin, fungal or bacterial skin infections, parasitic infections, acne vulgaris, atrophic skin, striae atrophic, fragility of skin veins, ichthyosis, ulcers or wounds.
4. Participants exposed to excessive or chronic ultraviolet (UV) radiation (i.e., sunbathing, solarium); and waxing, laser/IPL hair removal, fake/spray tanning is prohibited 14 days prior to enrollment or who may foresee an intensive UV exposure or swimming during study participation.
5. Known hypersensitivity or allergy to NSAIDs or gabapentinoids or any component(s) of the investigational products. This includes participants exhibiting aspirin or other NSAID-induced symptoms, including bronchospasm, rhinitis, and urticaria or other NSAID-induced allergic symptoms.
6. Participants with unstable or severe illness, including clinically significant malignancy, of hepatic, pulmonary, metabolic, neurologic, cardiovascular, gastrointestinal (e.g., inflammatory bowel disease), hematological, or psychiatric system as indicated on medical history, physical examination, or clinical laboratory, vital signs, and ECG evaluations, or in the opinion of the Investigator.
7. Participants with any report of acute illness or febrile event within 72 hours prior to randomization.
8. Known positive coronavirus disease 2019 (COVID-19) viral test during Screening or within 3 days prior to Day -1, or suspected COVID-19 infection at check-in on Day -1 visit.
9. Participants who cannot refrain from strenuous exercise from 72 hours prior to first study dose through completion of the Safety follow-up visit
10. Any other condition that, in the opinion of the investigator, would jeopardize the safety of the study participant or impact the validity of the study results