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Recently, Epizyme, Inc. (EPZM - Snapshot Report) announced that the U.S. Food and Drug Administration (FDA) has granted orphan drug status to the company’s pipeline candidate EPZ-5676. Epizyme is developing the candidate for treating a rare form of acute leukemia characterized by a re-arranged MML gene (mixed lineage leukemia). The re-arrangement is caused by chromosomal translocation. Epizyme is currently in phase I studies.

We note that the FDA grants orphan drug designation to those drugs that are meant for treating rare diseases affecting not more than 200,000 people in the U.S. The orphan drug designation granted to EPZ-5676 will facilitate its development by providing incentives such as tax credits and research and development grant funding.

We note that Epizyme has the entire rights pertaining to EPZ-5676 in the U.S. The company granted Celgene Corporation (CELG - Analyst Report) an exclusive license to develop and commercialize the candidate in ex-U.S. markets. Moreover, in Apr 2013, Epizyme joined forces with Abbott Laboratories (ABT - Analyst Report) for the development of a molecular companion diagnostic test for use with EPZ-5676.

Under this deal, Abbott Labs will use its fluorescence in situ hybridization technology to develop the test. It will help in identifying patients eligible for treatment with EPZ-5676. Financial details of the deal were not provided.

Epizyme was also in the news recently when it raised $88.7 million (gross) through an initial public offering. The funds will help Epizyme in developing its pipeline further.

Epizyme, a biopharmaceutical company, carries a Zacks Rank #3 (Hold). Gilead Sciences, Inc. (GILD - Analyst Report) looks well-positioned in the biopharma space with a Zacks Rank #1 (Strong Buy).

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