Barr Pharmaceuticals Inc has exercised its option to make a one-time royalty payment of $19 million to Eastern Virginia Medical School (EVMS) related to Barr's exclusive research and license agreement for the Seasonale extended-cycle oral contraceptive.

Under terms of the licensing agreement, Barr had the option of paying a perpetual royalty based on a percentage of net profits, or exercising its right to make the one- time payment prior to the first anniversary of the approval date of the Seasonale product by FDA, a company release said.

"Since the launch, more than 260,000 prescriptions have been filled for Seasonale, and we anticipate continued strong growth for this exciting contraceptive option. We also continue to work on other extended-cycle oral contraceptives that will broaden this product franchise," said Bruce L Downey, chairman and CEO. "By exercising our option to make this one-time royalty payment, we have satisfied all future royalty obligations to EVMS and provided them with a substantial return on the research conducted at their outstanding institution," he added.

The $19 million one-time royalty payment will initially be capitalized, and ultimately expensed over the estimated lives of the products marketed by Barr under the license agreement.

Barr launched the Seasonale extended-cycle oral contraceptive in November 2003 to healthcare providers following FDA approval of the product for the prevention of pregnancy. Seasonale, indicated for the prevention of pregnancy, was developed under a research and license agreement with EVMS. At the time of FDA approval, Seasonale was granted a three-year New Product Exclusivity that expires on September 5, 2006. The patent covering Seasonale expires in 2017.