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Argenica Therapeutics Ltd (ASX:AGN) has seen its share price rise nearly 5% on news it has received an Orphan Drug Designation (ODD) and Rare Pediatric Disease Designation (RPDD) for drug candidate ARG-006 from the US Food and Drug Administration (FDA).

The drug candidate treats hypoxic ischaemic encephalopathy (HIE), a condition in which a baby’s brain is injured through a lack of proper blood or oxygen flow, with ARG-006 focusing on the impact among newborns.

Argenica has been progressing assessment of two drug candidates which may treat HIE: ARG-006 and a mirror-image (or L-isomer) drug, ARG-007, with both being tested in piglet studies to find out which has the preferred target product profile.

Of particular consideration in these assessments will be the different stages of brain injury within HIE – which often occur over several days or weeks, as differentiated from acute ischaemic stroke – seeking to identify which of the two drugs aligns best with this pattern.

Receiving ODD status will provide Argenica with tax credits for qualified clinical trials, exemption from user fees and the potential for seven years of market exclusivity following approval.

The key advantage of the RPDD status is that once a New Drug Application (NDA) is approved for either ARG-006 or ARG-007 in HIE, the FDA could award a Priority Review Voucher (PRV), if HIE is the first indication for which the drug is approved.

The sale price of a PRV is often in the tens of millions of dollars.

at 14:36 AEDT, Argenica shares were trading at 75.5% – a rise of 4.86% since the market opened.

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