Hemoglobin-based oxygen carriers have been under development for decades, but safety concerns have prevented commercial approval. Early designs for modified hemoglobins by polymerization or intramolecular cross-linking reactions increased molecular size and decreased oxygen affinity, but all exhibited side effects of vasoconstriction and reduced blood flow. A new strategy has been established by applying principles of oxygen transport to cell-free hemoglobin. Sangart has developed a new oxygen therapeutic, Hemospan, using site-specific, poly(ethylene) glycol conjugation chemistry designed on two principles: (i) increased macromolecular size to prolong intravascular retention time, and (ii) increased oxygen affinity to prevent premature oxygen offloading in arterioles. In contrast to early-generation products, Hemospan infusion maintains normal arteriolar vascular tone and capillary flow. Phase I and Phase II clinical trials have been completed, showing that Hemospan is well-tolerated in humans, with evidence of efficacy to impart hemodynamic stability in surgical patients under anesthesia. Phase III trials in orthopedic surgery have recently completed enrollment in Europe.