What happened

Shares of Vertex Pharmaceuticals (NASDAQ:VRTX) gained more than 13% last month, according to data from S&P Global Market Intelligence. The monthly surge continued a sudden end-of-year rally for the pharma stock. Shares rose just 2.2% from the beginning of 2019 to the end of September but have risen 30% since the beginning of October. 

Why are investors suddenly interested in the rare-disease specialist? Vertex Pharmaceuticals has announced a number of positive developments for its drug pipeline, including new partnerships and regulatory approvals. Specifically in November, the company and collaborator CRISPR Therapeutics announced that the first two patients dosed with CTX001 achieved promising, albeit early and ongoing, results.

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So what

In addition to the mid-month announcement with CRISPR Therapeutics, shares of Vertex Pharmaceuticals continued to benefit from solid third-quarter 2019 operating results reported at the end of October. The rare-disease specialist reported $950 million in quarterly revenue, up 21% from the year-ago period. 

For the first nine months of 2019, Vertex Pharmaceuticals delivered $2.75 billion in revenue, marking year-over-year growth of 26%. The business also generated $646 million in operating income and $1.12 billion in operating cash flow, up 27% and 17%, respectively, from the year-ago period. 

The company is poised to continue growing product revenue. It recently received regulatory approval for Trikafta, a triple-combination therapy that greatly expands the number of cystic fibrosis patients who can benefit from treatment, in both the United States and the European Union. Morningstar analyst Anna Baran believes the approval could enable the cystic fibrosis arsenal of Vertex Pharmaceuticals to achieve $10 billion in annual revenue by 2028. 

Now what

Vertex Pharmaceuticals remains a promising biotech stock. The company has delivered innovative therapies for individuals suffering from cystic fibrosis, reaped the economic benefits from its leadership position, and leveraged the windfall to expand into other rare diseases. If the business can achieve the peak annual sales opportunity of $10 billion by 2028 as Morningstar analysts believe, then this stock is a solid investment for long-term investors. Well, if drug pricing concerns don't get in the way.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.