Guess which ASX healthcare stock is rocketing 20% today

Dimerix Ltd (ASX: DXB) shares are taking off on Tuesday.

In morning trade, the ASX healthcare stock is up 20% to a 52-week high of 36 cents.

Why is this ASX healthcare stock jumping?

The catalyst for this rise has been the successful completion of an institutional placement.

According to the release, Dimerix has received firm commitments to raise $20 million from a significant number of new and existing institutional and sophisticated investors.

Demand was so strong for the placement that the ASX healthcare stock was able to raise the funds at 30 cents per new share. This means that no discount was necessary for the institutional placement.

It also represents a premium of 29.2% to its 30-day volume weighted average price (VWAP) of 23.2 cents and a premium of 14.5% to the five-day VWAP of 26.2 cents.

Why was demand so strong?

The ASX healthcare stock’s placement was in demand because it coincided with news from the ACTION3 Phase 3 trial.

The trial of DMX-200 in patients with focal segmental glomerulosclerosis (FSGS) was successful in the pre-specified interim analysis of the proteinuria (efficacy) endpoint from its first 72 randomised patients.

Management also highlights that analysis indicated that, using a statistical measure, DMX-200 is performing better than placebo in terms of reducing proteinuria (a surrogate marker of kidney disease progression) in patients with FSGS.

The company’s CEO, Dr Nina Webster, commented:

We are delighted to welcome our new Institutional and sophisticated investors, and we appreciate the strong support from existing shareholders. This Placement was highly strategic as it provides sufficient funds to take Dimerix through the 2nd interim analysis and, including eligible R&D rebates, the completion of the ACTION3 Phase 3 clinical trial.

If the next interim analysis is compelling, the Company could seek to apply for accelerated marketing approval in certain jurisdictions. By completing this Placement, Dimerix has not only accessed funding from high quality institutional investors to deliver on its Phase 3 program, but also significantly strengthened its balance sheet and this puts us in a strong negotiating position with potential partners, particularly on the back of our successful interim analysis just announced.

The post Guess which ASX healthcare stock is rocketing 20% today appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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