Watson Pharmaceuticals, Inc. has announced an exclusive licensing

agreement to commercialize the Population Council's investigational

contraceptive vaginal ring in the United States, Canada, and Mexico. The ring,

which contains two hormonal products - ethinyl estradiol and Nestorone, a

novel, synthetic progestin - is currently in Phase 3 clinical development.

"This ring, if approved, will provide women with an important new

user-controlled long-term contraceptive method," says Population Council

President Peter J. Donaldson. "We are pleased to be entering into this

agreement with Watson, which has made its commitment to women's health a

cornerstone of its business."

"The addition of this novel vaginal ring product further expands our

contraceptive portfolio by adding a unique contraceptive choice for women,"

says Fred Wilkinson, Watson's executive vice president of global brands. "The

Population Council is a leading force in the development of reproductive

health products and a natural ally for Watson as we continue to focus on

providing women with a wide array of safe, effective options for reproductive


Under the terms of the agreement, Watson will pay the Population Council

an undisclosed licensing fee and make additional payments based on the

achievement of certain regulatory and sales performance milestones. If the

product is successfully commercialized, Watson also will pay royalties based

on sales in the United States, Canada, and Mexico. As a result of this

agreement, Watson will assume responsibility for specific future development,

regulatory, and marketing expenses related to the commercialization of the

contraceptive ring. In addition, the agreement has special provisions for

providing the product to certain public-sector organizations.

The Nestorone/ethinyl estradiol contraceptive vaginal ring is designed to

simultaneously release Nestorone along with a low dose of ethinyl estradiol

for up to 13 cycles (one full year). The ring remains in the vagina for three

weeks per cycle, followed by one ring-free week. It is intended to be inserted

and removed by the woman herself without the help of a healthcare