The deal is with Bangladeshi group Mystic Pharmaceuticals Limited, which will get access to ValiRx's patented technology, including pre-clinical products, to further develop them for the benefit of ValiRx for five years.
If it leads to a successful marketing of a product, ValiRx will receive up to a 50% royalty.
"This is the first of what I hope will be a number of such licencing agreements for several of our products," said Dr Satu Vainikka, ValiRx chief executive.
"We at ValiRx are delighted to be working with an impressive Mystic team and collaborating with them on projects to our mutual advantage and a 50/50 split on revenues if the collaboration makes money.
"We also benefit through the use of additional production facilities for newer products not yet in the clinical pipeline."
ValiRx shares eased around 3% to 2.04p.