Where is this located on your baby?
What are you currently feeding him?
Did the vet offer ANY ideas on what it is?
Not sure if my other questions came through to you or not so I will post them again. Thanks for the above information though :)
The first thing that comes to mind is that he may have developed a hot spot.The best way to treat this is to shave the area, wash with a mild antibacterial soap, rinse and pat dry thoroughly then apply Witch Hazel to the area twice per day. This will dry out the area and promote healing. It will likely get worse before it gets better, so you might consider applying some neosporin to the area as well. To give him some additional relief from the itching, you can give him plain benedryl, provided he is not on any other medications, 1-2mg per pound of body wieght every 8 hours. Hot spots (and itching in general) can be brought on by allergies (or can be seasonal). Which is where the food comes in. I would recommend that you stay away from products that contain corn or beef as these are big allergy triggers. I have been feeding my babies Eagle Pack Holistic Duck and Oatmeal variety and it comes in kibble and in canned foods. Eagle Pack also makes treats :) You can read more about it below:
http://www.eaglepack.com/ click holistic dog :)
If it is being caused by a flea bite (one bite can cause a heap of itchy issues) the benadryl in the dosage above will give him some relief. You can also give him a cool oatmeal bath to aid in relief. :)
Good luck and hope he feels better very soon. :)