An Arbitration Panel has determined that Barr Pharmaceuticals' wholly-owned subsidiary, Duramed Pharmaceuticals Inc, did not properly terminate its contract with Solvay Pharmaceuticals Inc regarding the joint promotion of Duramed's Cenestin Tablets, a company release said.

A two-member majority of the Panel ordered Duramed to pay Solvay $68 million in monetary damages over the next 16 months, over the strong disagreement of the Panel's chairman, who stated that the award "far exceeds any damages the evidence would support." The majority gave no explanation for its calculation of the damage award, the release says.

"We strongly disagree with the Panel's opinion and intend to review all opportunities for challenging the award," said Bruce L Downey, Barr's chairman and CEO. "We continue to believe that Duramed lawfully terminated its agreement with Solvay. We also agree with the chairman's conclusion that the amount of the award is contrary to the evidence," he added.

On March 31, 2002, the company gave notice of its intention to terminate, as of June 30, 2002, its relationship with Solvay Pharmaceuticals, Inc, which covered the joint promotion of the company's Cenestin tablets, and Solvay's Prometrium capsules. Solvay had disputed the company's right to terminate the relationship and claimed it was entitled to damages. The Arbitration Panel was formed and the arbitration began in January 2004.