The new drug could perhaps treat 2,400 conditions, including some types of cystic fibrosis and Duchenne muscular dystrophy, as well as the blood clotting disease haemophilia.
The National Institutes of Health (NIH) Office of Rare Diseases estimates that genetic disorders are responsible for the majority of rare diseases that afflict 25 million people in the US.
It is estimated that, on average, 5-15% of patients with any of at least 1,800 distinct genetic disorders have a nonsense mutation as the underlying cause of the disease, including cystic fibrosis, Duchenne muscular dystrophy, spinal muscular atrophy, hemophilia, lysosomal storage disorders, retinitis pigmentosa, familial hypercholesterolemia and some forms of cancer.
Cells in the body contain machinery that 'reads' lines of DNA and uses the information to create proteins.
However, a nonsense mutation sends out a rogue 'stop' signal before a cell has finished making a protein. The resulting half-finished protein is useless.
The new drug - known only as PTC124 - makes cells less sensitive to these mutations, and thus lets the cell complete its job.
Given early enough, PTC124 could even halt the progress of some genetic illnesses - many of which are incurable.
In cystic fibrosis, for instance, the lack of protein called CTFR causes the body's fluids to become abnormally thick and sticky, causing breathing and digestive problems.
In tests on patients, PTC124 boosted production of the protein and improved breathing, the British Society for Human Genetics conference heard Monday.
It is thought that PTC124 could help 10 per cent of the 8,000 cystic fibrosis sufferers in Britain.
More trials are due to start soon. Tests on youngsters with Duchenne muscular dystrophy, which affects 100 babies a year in the UK, have also been promising.
In mice, the drug repaired muscle mass lost to the degenerative disease and it is hoped that PTC124 could help 13 per cent of human sufferers.
PTC124 researcher Dr Lee Sweeney, of the University of Pennsylvania, said: 'This new class of treatment has the potential to help a large number of patients with different genetic diseases that have the same type of mutation.'
Dr Marita Pohlschmidt of the Muscular Dystrophy Campaign said: 'PTC124 has previously shown encouraging results in clinical trials for Duchenne muscular dystrophy.
'However, as the drug applies to boys with a specific mutation, only 10-15 per cent of the 2,000 boys living with the condition in the UK might be treated.'
Dr Peltz, of PTC Therapeutics, said: 'The difference between this and other drugs is it doesn't [just] treat the symptoms, it treats the underlying cause.
'The drug allows the body to make the lost protein.'
The drug comes as a vanilla-flavoured powder to make it easier for patients to take.
This would be dissolved in water, milk or juice and taken with meals.
It is hoped the drug, which would have to be taken every day for life, could be on the market by 2010.