The British government has announced £20 million would be disbursed to thalidomide victims over the next three years. It will also issue a public apology to the so-called 'thalidomiders.'
Under the terms of a new deal, the Department of Health will release the funds to the Thalidomide Trust.
Health Minister, Mike O'Brien said the arrangement would help thalidomide survivors meet their "changing and increasing health needs" as they approach older age.
"I know that this will be a much-anticipated early Christmas present for all those involved.
"I would also like to pay tribute to the work of the Thalidomide Trust and its officers, and members of the National Advisory Council who have worked tirelessly to champion the cause of thalidomide survivors, and whose contribution in supporting them and their families cannot be overstated."
Dr Martin Johnson, director of the Thalidomide Trust, said the present campaign team had been working for seven years to bring about today's announcement.
"We're absolutely delighted. The campaigners feel this is a very successful end."
But he added: "2009 is the 50th year of the first thalidomide babies being born in Britain and the thalidomide disaster is the biggest peace time disaster to happen in this country so it is surprising it's taken so long."
He said the money would enable people to pay for health care not available on the NHS and help with car and house adaptations to prevent further deterioration of people's mobility.
Thalidomide, the morning sickness drug, was withdrawn after 2,000 babies were born with limb deformities and other damage.
In the 1970s, the drug's UK manufacturer, Distillers Biochemicals, paid out around £28m compensation following a legal battle.
Campaigners said they had wanted justice to help ease the lives of those who for 50 years have struggled daily with "terrible deformities".
They also hope a further £5m could be provided if Scotland, Wales and Northern Ireland contribute to the fund.