A drug used to treat a rare disease and for which the manufacturer receives special tax credits and marketing rights as an incentive to develop the drug.
In 1983, hoping to encourage research, the government began offering tax credits, research grants and other incentives to companies working to treat rare diseases.
The incentives, provided under the Orphan Drug Act, worked. In the decade before it was passed, fewer than 10 orphan drugs came to market; since the act, 193 have been approved, nearly half of them in the last five years.
Denise Grady, "In Quest to Cure Rare Diseases, Some Get Left Out," The New York Times, November 16, 1999
Some drugs lag in development because they are intended to treat less common diseases and have a relatively small market potential. Sodium valproate for epilepsy was just such an "orphan drug" and, according to some experts, languished in the bureaucratic pipeline because neither its manufacturer nor the FDA gave it a particularly high priority.
Matt Clark, "How Bad the Drug Lag?," Newsweek, October 9, 1978
A rare disease for which no company is actively working on a cure is often called an "orphan disease."