The drug Eliquis, also known as apixaban, is widely considered one of the most important new products for the two U.S. drugmakers, with multibillion-dollar annual sales potential.

The European approval was expected after an advisory panel this year recommended it for atrial fibrillation.

"It's not unexpected, but it's positive to finally get an afib approval under the belt for Eliquis," said MKM Partners analyst Jon Lecroy, who sees annual sales reaching $2 billion by about 2017. "We're looking for a March approval or earlier in the U.S. for the same indication," he added.

The U.S. Food and Drug Administration is expected to decide on the proposed use of the drug in the world's biggest market by March 17, after delaying a decision in June to review more information from clinical trials.

The European Commission approval marks the first regulatory approval for Eliquis for stroke prevention in atrial fibrillation patients in any market, the companies said.

Eliquis belongs to a new class of medicines designed to replace decades old warfarin for preventing blood clots in heart patients and after hip or knee replacement surgery.

It already was approved in 27 European Union countries for prevention of certain blood clots called venous thromboembelisms following elective hip or knee replacement surgery.

But atrial fibrillation, which greatly raises the risk of strokes, is considered by far the largest and most important use for the new drugs, that include Xarelto from Bayer and Johnson & Johnson, and Pradaxa from privately held Boehringer Ingelheim.

Eliquis, like Xarelto, works by inhibiting a protein called Factor Xa that plays a critical role in blood clotting. Pradaxa has a slightly different mechanism of action.

About 6 million people in Europe and another 5.8 million in the United States suffer from atrial fibrillation, the most common form of heart arrhythmia, or irregular heartbeat.

In clinical trials, Eliquis demonstrated superiority over warfarin in reducing the risk of strokes, major bleeding and death.

Warfarin, widely used for more than half a century, is inexpensive and works well, but requires close and regular patient monitoring as well as lifestyle and dietary changes that are not necessary with the newer medicines.

"Patients with atrial fibrillation have a five times greater risk of stroke and there remains a critical public health need for improved treatment options to reduce this risk," Lars Wallentin, director of cardiology at Uppsala Clinical Research Centre and University Hospital in Sweden, said in a statement.

He called Eliquis "an important new treatment option for health care professionals, who now have an oral anticoagulant with superior outcomes versus warfarin."

Wall Street analysts have said that, based on clinical efficacy and safety data, they believe Eliquis will become the dominant player in an estimated $10 billion market for the new blood thinners once it receives U.S. approval.

Pfizer Chief Executive Ian Read, in a statement, said he believes Eliquis "has the potential to transform the standard of care in stroke prevention in nonvalvular atrial fibrillation".

Pfizer shares were up 5 cents at $24.19 and Bristol-Myers shares were up 2 cents at $32.05, in afternoon trading on the New York Stock Exchange.

(Reporting by Bill Berkrot; Editing by Gerald E. McCormick, Tim Dobbyn and David Gregorio)

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