An orphan drug is characterized by which of the following?

An orphan drug is specifically designated to treat rare diseases or conditions, which is generally defined as affecting fewer than 200,000 people in the United States. One of the defining characteristics of orphan drugs is that they receive special economic incentives from the government to encourage their development. These incentives may include tax breaks, grants, and extended exclusivity periods for the manufacturer. This support aims to make it financially viable for pharmaceutical companies to invest in research and development, given that the small patient population makes it unlikely for these drugs to generate significant sales.

In contrast, options like a significant market, being a generic medication, or lack of approval do not accurately describe orphan drugs. They typically do not have a significant market due to their focus on rare conditions. Orphan drugs are also not usually generic; they are often the innovative and original treatments specifically created to address those rare diseases. Additionally, orphan drugs go through the regulatory approval process and are approved for use within their specific indications, making the characterization of not being approved inaccurate.