Yesterday Vertex Pharmaceuticals (VRTX) received European approvals for two indications of its Cystic Fibrosis drug. More specifically, expanded use of Kalydeco (ivacaftor) was given for cystic fibrosis patients between the ages of 2 to 5 who have one of nine gene mutations. In addition, the commission approved expanded use of ivacaftor for patients who are 18 and older with the R117H mutation.

This expands upon the company’s current Cystic Fibrosis market as it already has a dominant hold on this space. The current share price of Vertex is $130.59, which is way below the 52-week high of $143.45 per share. With these recent news developments the share price should continue an uptrend as analysts update their price target. 

This is because the new expansions of use reach out to a large group of Cystic Fibrosis patients who desperately need this type of a treatment. Cystic Fibrosis occurs because of a mutated CFTR gene, specificaly when the CFTR protein is missing or defective. This defective gene blocks the function of cells at the surface of the lungs from clearing the mucus from the airways, thus causing problems. Ivacaftor reverses this process so that cells can clear airways appropriately.