The patient has scabies, which is characterized by intense pruritus and erythematous papules, especially in the flexural and genital areas. Permethrin cream is the treatment of choice. Treatment with topical steroids will help reduce the pruritus but will not eliminate the scabies mite. Topical antibiotics can be used to treat folliculitis. However, given the distribution of the lesions, diagnosis of folliculitis would be less likely.