N4-Hexadecyl-1-beta-D-arabinofuranosylcytosine (NHAC) is a new lipophilic derivative of 1-beta-D-arabinofuranosylcytosine (ara-C) with strong antitumour activity. The interactions of NHAC incorporated into small unilamellar liposomes of different compositions with blood components were evaluated. In comparison with ara-C, NHAC is highly protected against deamination to inactive arabinofuranosyluracil (ara-U) in human plasma, resulting in only 2% conversion into ara-U after 4 h incubation at 37 degrees C, whereas from ara-C more than 80% was deaminated. In in-vitro incubations with human blood, it was found that NHAC was transferred from the liposomes at about 47% efficiency to plasma proteins, particularly to albumin and to the high and low density lipoproteins. The remaining part of NHAC was bound to erythrocytes (50%) and to leucocytes (3%). The addition of poly(ethylene) glycol-modified phospholipids to the liposomes (PEG liposomes), which were composed of soy phosphatidylcholine and cholesterol (plain liposomes), did not significantly prevent the fast transfer of NHAC from the liposomes to the blood components. Pharmacokinetic studies in mice revealed that NHAC had biphasic kinetics in blood with a t1/2 alpha of 16 min and a t1/2 beta of 3.8 h when the drug was formulated in plain liposomes and a t1/2 alpha of 15 min and a t1/2 beta of 9.67 h in PEG liposomes, respectively. NHAC was predominantly distributed in the liver with 29% of the injected dose found after 30 min.