On May 29, 2011 XTL has announced that its rHuEPO (recombinant human erythropoietin) drug which is currently in preparations for phase 2 clinical trial, has been granted an Orphan-drug designation by the US Food and Drug Administration (FDA) for treatment of Multiple Myeloma blood cancer.
An orphan drug is defined as a drug treatment for an illness that affects a relatively small number of people in the population. In the US, an orphan drug designation is limited in connection with illnesses that affect less than 200,000 people a year.
In order to encourage the development of treatments to these diseases, regulatory authorities provide benefits and incentives for the developers. The standard benefit available for orphan drugs in the US is the right of sole exclusivity of marketing the drug for a period of 7 years from the day of FDA approval. Additional benefits include local tax credit in the US on research and development expenses, and exemption from payment of commissions to the FDA, a sub-unit of the US Department of Health & Human Services.