Barr Pharmaceuticals’ Duramed subsidiary has signed a product acquisition agreement with Shire for Adderall tablets, as well as a product development agreement for six proprietary products. Also, Barr Laboratories, Inc. has signed a settlement and license agreement relating to two pending patent cases involving Shire’s Adderall XR. The agreements will be submitted to the U.S. Federal Trade Commission as required by law and become effective upon the Courts’ signing of consent judgments in the two pending cases.

“We believe the agreements provide an equitable resolution to our Adderall XR patent litigation that creates a significant benefit for consumers, as well as the company’s shareholders,” said Bruce L. Downey, Barr’s chairman and chief executive officer. “The agreements enable a pro-competitive and pro-consumer introduction of a generic version of Adderall XR more than nine years earlier than might otherwise have been possible. It will also result in an investment in R&D for six products initially, which will enhance our ability to expand our proprietary development activities. Finally, it provides us immediate access to the immediate-release Adderall brand product, a generic version of which we have manufactured and marketed since 2002.”

Under the terms of the product acquisition agreement, Duramed will pay Shire $63 million for its Adderall tablets. This agreement is subject to reporting under the U.S. Hart-Scott-Rodino Act.

Barr currently manufactures and markets a generic version of Adderall that it first launched in February 2002. Adderall is indicated as part of a treatment program which typically includes other remedial measures (psychological, educational, social) for a stabilizing effect in children with behavioral syndrome characterized by the following group of developmentally inappropriate symptoms: moderate to severe distractibility, short attention span, hyperactivity, emotional lability and impulsivity.

In a separate development agreement, Duramed granted Shire a license to obtain approval for and market its recently approved Seasonique tablets extended-cycle oral contraceptive product and five products in various stages of development utilizing Duramed’s transvaginal ring technology. Shire will pay Duramed an initial $25 million for previously incurred product development expenses, and will reimburse Duramed for development expenses of as much as $140 million during an eight-year period, not to exceed $30 million per year. Upon approval, Duramed will retain rights to market and promote these products in North America, Central and Eastern Europe and Russia, while Shire will maintain the same rights in the rest of the world, including five countries in Western Europe.

The settlement and license agreements permit Barr to launch a generic version of Adderall XR, under terms of a license beginning April 1, 2009, nine years earlier than the last-to-expire Shire patent, or earlier under certain circumstances such as the launch of another party’s generic version of Adderall XR. The license will be exclusive for the first 180-days following Barr’s launch. Barr would pay Shire a royalty equal to a portion of profits from the sales of generic Adderall XR. As part of the settlement, Barr agrees that Shire’s patents are valid and enforceable and that its generic product infringes one of the Shire patents.