(FORTUNE Magazine) – In a dimly lit operating room at the Thompson Cancer Survival Center in Knoxville, Tennessee, a surgeon uses an endoscope to guide an optical fiber down the throat of a patient afflicted with cancer of the esophagus. Monitoring the fiber's progress on a video screen, he maneuvers its tip to the tumor site. When it is in place, he signals an assistant in the next room who throws a switch on a console. The optical fiber glows eerily as red laser light courses through it to the tumor.

What ensues within the cancerous tissue is the microscopic equivalent of strangulation. The patient has received intravenously, and the tumor cells have absorbed, a drug sensitive to certain frequencies of light. Though the laser is too feeble to destroy cells directly, it sets off a chemical reaction that causes nearby oxygen molecules to form singlet oxygen-a toxic version of the element. The oxygen disintegrates both cancer cells and the tiny blood vessels that supply the tumor; within 24 hours, the tumor will start to die.

Sound like medicine as it might be practiced aboard the starship Enterprise? Quadra Logic Technologies, a publicly held biotech company in Vancouver, British Columbia, is today marketing the procedure, known as photodynamic therapy, in Japan, Canada, and the Netherlands.

Photodynamic therapy has been shown to cure small tumors that are caught early and is useful in attacking tumors that are hard to get at with a scalpel, says Quadra Logic co-founder and chief scientist Julia Levy. Though scientists have long known that light-activated drugs can kill cancer cells, the company's laser-activated drug, Photofrin, is the first such medicine to reach the market. Doctors in Japan recently began using it to treat patients with early-stage lung, stomach, esophageal, and cervical cancer. Canadian doctors are starting to use it to combat bladder cancer.

In the U.S., the company is awaiting final approval from the Food and Drug Administration to market Photofrin as a treatment for esophageal cancer. Some 12,000 Americans are diagnosed with the disease each year; just 20% are likely to survive more than five years after diagnosis. Mostly aged men, the victims often spend their last months unable to eat. Since the cancer is typically diagnosed only at an advanced stage, after it has spread to other parts of the body, photodynamic therapy can't cure it. But by shrinking tumors, it enables terminally ill patients to live longer and suffer less. Says Levy: "Some patients have no alternative treatment. We can help them enjoy the last months of their lives so they can eat food again."

Other companies are developing light-activated drugs, including PDT in Santa Barbara and Dusa Pharmaceuticals in Mississauga, Ontario. Quadra Logic is testing a follow-up drug, benzoporphyrin derivative (BPD), which is activated by light of a different wavelength and penetrates tissue more deeply than Photofrin. In early clinical trials, doctors have used BPD successfully in treating small patches of psoriasis and skin cancer. "BPD is useful whenever you have a skin disease that is proliferating, such as tumors or psoriasis," says one of the trial's participants, Dr. R. Rox Anderson, research director of the Laser Center in Massachusetts General Hospital's Wellman Laboratory. He says dermatologists need a better treatment for large areas of psoriasis in particular, because current methods can cause cancer and liver damage. Quadra Logic plans to complete three more years of clinical tests before seeking FDA approval.

Photodynamic therapy may eventually help patients losing their eyesight to macular degeneration, a disease in which blood vessels grow across the retina. It is the leading cause of blindness in people over 50. The company recently joined forces with Ciba-Geigy to pursue BPD as a treatment for the disease. The companies are seeking approval from U.S. and German authorities to begin clinical trials in both countries.