And with Faletau's backrow colleague at both club and international level Danny Lydiate also continuing his excellent season, Edwards believes there is a foundation on which the region can build.
"I have no problem losing someone like Luke Charteris when this is probably his last chance to get a big contract abroad," said Edwards whose side currently lie tenth in the RaboDirect PRO12.
"The problem for us is going to be holding on to the young players. We have guys who we want to become the foundation of the team, it's why I was so pleased to have Toby Faletau sign a new contract.
"We know we can't compete with the big French teams on a financial level, not even close.
"But if we can keep producing players then we can stay competitive.
"We saw this weekend that we pushed Perpignan very hard in one of the toughest places in Europe to go.
"It was disappointing to come away with a defeat but the fact that we are disappointed shows how far we have come."
That defeat to Perpignan, 27-13 at the Stade Aimé Giral came in the Challenge Cup, Europe's second tier competition, and Edwards admits regular Heineken Cup rugby has to be the ambition.
And while the Dragons currently lie 14 points off the Cardiff Blues in the RaboDirect PRO12, Edwards is optimistic they can make up the lost ground with six of their final ten games at home, including a rearranged clash with the Blues.
He added: "The Heineken Cup is a huge target for us and you have to remember we had a really tough start to the season with six away games in our first eight matches.
"With the games we have left we'll look to pick up 30 points and if we can do that, who knows what will happen.
"This is a season of transition for us though, and we were seriously affected by the World Cup losing a few key players.
"The good thing is that people stepped up when those players were away, and we saw someone like Lewis Evans in the back row get a place in the Welsh squad on the back of that.
"The youngsters need to keep taking those opportunities when they come along, and with the Six Nations coming up they will get chances.
"We have a vision of what we want to do at the club, and producing players for the national team shows we are on the right track.
"Now we need to learn to cope without those players when they are needed by Wales."
63x46.png){kind=logo}