What: Shares of TherapeuticsMD (TXMD 2.13%), a drug manufacturer with a focus on women's health, skyrocketed more than 45% higher as of 10:30 a.m. EST Tuesday after the company reported positive top-line results for to its lead compound TX-004HR.

So what: TX-004HR is TherapeuticsMD investigational compound that is being researched as a treatment for moderate to severe dyspareunia, or vaginal pain during sexual intercourse. Dyspareunia is a symptom related to vulvar and vaginal atrophy, or VVA, in menopausal women.

In its Phase 3 clinical trial, named Rejoice, TX-004HR was evaluated at three different dosage levels over a 12-week period. Top-line results released Monday indicated that TX-004HR showed highly statistical significance in meeting all four of the trial's primary co-endpoints.

Source: TherapeuticsMD

With these results in hand management is planning on submitting TX-004HR for FDA approval in the first half of next year.

This great clinical news caused investors to cheer, sending shares screaming higher.

Now what: In the release, TherapeuticsMD CEO Robert G. Finizio stated:

"With efficacy observed as early as two weeks and the convenience of the applicator-free vaginal softgel, we believe that, if approved, TX-004HR has the potential to offer a highly differentiated, new treatment option that meets the needs of the millions of postmenopausal women with VVA who are suffering from pain during sexual intercourse."

Approximately 32 million women in the United States currently experience symptoms of VVA and yet only 7% are currently being treated with a prescription therapy, so if TX-004HR can gain approval it is staring down a large market opportunity. Peak sales for the drug are running as high as $1 billion.

That's a huge number and it could indicate that even after Tuesday's pop there is additional upside in TherapeuticsMD stock. After all, earlier this year Valeant Pharmaceuticals (BHC 0.35%) paid $1 billion to acquire Sprout Pharmaceuticals, a company that had just received FDA approval for Addyi, a drug known as the "female viagra." Analysts believed that Addyi peak sales would reach about $100 million, meaning that Valeant Pharmaceuticals paid roughly 10 times estimated peak sales to make the deal happen. While in time that estimate could prove to be highly conservative, the deal does show there are companies like Valeant Pharmaceuticals out there that may be willing to pay a premium to get their hands on innovative therapies that treat women's health.