What happened? 
It's been a week to remember for shareholders of Vertex Pharmaceuticals (NASDAQ: VRTX), as the cystic fibrosis leader once again received some great news from across the pond, which it then shared with its investors. The European Union has officially given Orkambi, its new cystic fibrosis medicine, the green light for marketing authorization in the region. The labelling for Orkambi applies to patients age 12 or older with two copies of the F508 mutation. 

While this news shouldn't come as much of a surprise to Vertex Pharmaceuticals investors, as the company already announced that the EU Committee for Medicinal Products for Human Use -- or CHMP -- adopted a positive opinion on Orkambi back in late September, it is most certainly an important approval for the company as an estimated 12,000 patients in the region meet now qualify to use Orkambi.

Vertex's next step from here is to start the reimbursement approval process in each country individually.

Does it matter?
While 12,000 patients might not sound like it would matter much, it's actually quite a large number as it's roughly 50% greater than the number of patients who meet Orkambi's labeling criteria in the U.S. Given that Vertex generated more than $130 million in sales of Orkambi in its first quarter on the market, this approval greatly increases its chances of reaching blockbuster status in 2016. Add in the recent label expansion it just won for Kalydeco, its other cystic fibrosis treatment, and suddenly Wall Street's 2016 revenue estimate of $2.48 billion doesn't seem so outlandish. For perspective, that would represent growth of roughly 150% from the $1 billion in annual sales it's expected to show in 2015.

This approval also once again ups the ante for its competitors, who are, of course, attempting to catch up to Vertex. Concert Pharmaceuticals (NASDAQ: CNCE) has its own cystic fibrosis treatment that recently compared favorably to Kalydeco in its phase 1 trials. While those trials were early and small in size, Concert Pharmaceuticals liked what it saw enough that it decided to push the compound into phase 2 trials, which are slated to start next year.

Mind you, even if all goes well for Concert Pharmaceuticals, it will still be several years before its drug makes it to market, and just like Vertex, it would have to get approval for each and every cystic fibrosis mutation to have any hope of wresting market share away. Still, given Vertex's huge reliance on the cystic fibrosis market, investor should keep a close eye on Concert Pharmaceuticals' progress.

The market appears to be bidding up shares only slightly this morning on the news, which makes sense given that the approval was widely expected. Still, it's an important approval, so investors in Vertex should be breathing a little easier today.

Brian Feroldi has no position in any stocks mentioned. The Motley Fool recommends Vertex Pharmaceuticals. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.