Zeltia's Nypta gets orphan drug status, shares gain

* Being developed to treat progressive supranuclear palsy

* Shares up 2.2 pct

(Adds detail, share price)

MADRID, Nov 3 (Reuters) - Spanish biotechnology firm Zeltia's (ZEL.MC) Nypta drug to treat a degenerative brain disease has received orphan drug status from the European Commission and the U.S. Food and Drug Administration.

Nypta is being developed by Zeltia's Noscira unit to treat progressive supranuclear palsy (PSP), a rare disease that gradually destroys nerve cells in the brain that control eye movements, breathing and muscle coordination.

Phase II clinical trials on the drug are due to begin before the end of the year, Zeltia said in a statement on Tuesday.

Orphan drug designation is reserved for new therapies that are being developed to treat rare medical conditions, and in the United States the label grants the drug developers seven years of market exclusivity.

Shares in Zeltia rose 2.2 percent to 4.44 euros by 0820 GMT, bucking the negative market trend in Spain to extend an 8 percent gain on Monday after its Yondelis drug received European approval to treat ovarian cancer. [ID:nL2694227]

(Reporting by Tracy Rucinski; Editing by Simon Jessop)