The Dimerix Ltd (ASX: DXB) share price is rising strongly for a second day in a row.
So much so, at one stage today, the ASX healthcare share was up a further 48% to a 52-week high of 23 cents.
When Dimerix's shares reached that level, it meant they were up a mind-boggling 280% in the space of just two days.
The clinical-stage biopharmaceutical company's shares have pulled back a touch since hitting that high, but remain up 25% to 19.5 cents currently.
Why is this ASX healthcare share rocketing?
Investors have been scrambling to buy Dimerix's shares this week after it announced a licensing agreement with Advanz Pharma that could be worth up to ~$230 million.
The agreement is for its phase 3 drug candidate, DMX-200, for the treatment of focal segmental glomerulosclerosis (FSGS) kidney disease.
FSGS is a rare disease that causes kidney scarring and can lead to end-stage kidney disease. DMX-200's trials to date have been very promising and the first analysis outcome from its phase 3 trial is expected in March 2024.
This licensing agreement with Advanz Pharma, which covers DMX-200 in Australia, Canada, Europe, and New Zealand, would clearly be a big deal for the company. With a market capitalisation of approximately $80 million, it could generate revenue almost three times greater than its current valuation.
However, it does have to gain approval from regulators before that happens. It is also worth noting that the ~$230 million deal is predominantly based on unspecified milestones. So, it is unclear what will need to be achieved for the company to receive these funds.
Nevertheless, this is great news for the ASX healthcare share and shareholders will no doubt be eagerly awaiting an update on DMX-200 in March.
